Buyer's Broker Agreements It Doesn't Cost You Anything
When you decide you want to work with a Licensed Real Estate Agent, they are going to ask you to sign a Buyer's Broker Agreement. Now, don't let that document scare you. You can even bring it to your Real Estate Attorney to have them look it over before you sign it. But make sure that person only practices Real Estate Law or else another attorney will not understand like a Real Estate Attorney will.
Signing this agreement is to create a relationship between you and your agent. That agent will now be able to give you fiduciary duties which is explained further in this post.
1. Understand That Agents Work on Commission
- Very few real estate agents work on salary.
- Most real estate agents are paid commission. If an agent does not close a transaction, we do not get paid.
- Agents are not public servants and do not work for free. Do not ask an agent to work for you if you intend to cut the agent out of your deal or are not serious about buying.
2. Keep Appointments & Be On Time
- Be respectful, use common courtesy and don't expect an agent to drop what they are doing to run out to show you a home. You are probably not that agent's only prospect / client.
- Do not make an appointment with an agent and then forget to show up. I would never do that to someone unless I'm dead.
- If you are going to be late, call and let your agent know when you expect to arrive. I also do this to my clients so they do not waste their time coming in, in the event something happened on my end to prevent me from meeting with you at our scheduled time.
3. Choose A Real Estate Agent
- Decide whether you want to work without representation: dealing directly with listing agents, or if you want to hire your own agent.
- If you decide to hire your own agent, interview agents to find an agent with whom you are comfortable.
- If you are interviewing agents, let each agent know you are in the interview stage.
- Never, never, never interview two different agents from the same company. Trust me, don't do it.
4. Do Not Call The Listing Agent if You Are Working With a Buying Agent
- Listing agents work for the seller, not the buyer. If you hire the listing agent to represent you, that agent will now be working under dual agency. There is no way an agent can represent a seller and a buyer. An agent owes their seller-client Fiduciary Duties and the buyer fair and honest treatment. When you find a home with a listing agent and want to make an offer, the listing agent will tell you the offer has to be as close to the asking price as possible because they work for the seller and their job is to get the highest price possible for their seller-client. When we work for a buyer, we can negotiate on your behalf getting you the lowest price possible.
- If listing agent shows you the property, the listing agent will expect to represent you.
- Listing agents do not want to do the buying agent's job. Let your buyer's agent do their job.
5. Practice Open House Protocol
- Ask your agent if it's considered proper for you to attend open houses alone. In some areas, it is frowned upon to go to open houses unescorted.
- Hand your agent's business card to the agent hosting the open house. Sometimes this agent will be the listing agent, but often it is an agent also looking for unrepresented buyers. Announcing you are represented protects you.
- Do not ask the open house host questions about the seller or the seller's motivation. Let your agent ask those questions for you.
6. Sign a Buyer's Broker Agreement with a Buying Agent
- Expect to sign a buyer's broker agreement. It creates a relationship between you and the agent, and explains the agent's duties to you and vice-versa.
- Ask about an Exclusive Buyer's Broker Agreement.
- If you're not ready to sign a buyer's broker, do not ask that agent to show you homes. Otherwise, procuring cause may occur.
- Ask your agent if they will release you from the contract if you become dissatisfied. If they refuse, hire somebody else.
7. Always Ask For and Sign an Agency Agreement
- By law, agents are required to give buyers an Agency Disclosure.
- Signing an agency disclosure is your proof of receipt. It is solely a disclosure. It is not an agreement to agency. Read it.
- The best and most practiced type of agency is the single agency. This mean you are represented by your own agent who owes you a fiduciary responsibility.
8. Make Your Expectations Known
- If you expect your agent to pick you up at your front door and drive you home after showing homes, tell them. Many will provide that service. If not, they will ask you to meet at the office.
- Let your agent know how you want her to communicate with you and how often. Do you want phone calls, e-mails, text messages, IM's or all of the above? I always ask these questions myself.
- Set realistic goals and a time frame to find your home. Ask your agent how you can help by supplying feedback.
- If you are displeased, say so. <-------Yes, that is important!
9. Do Not Sign Forms You Do Not Understand
- Do not feel silly for asking your agent to explain a form to you. It is their job. Many forms are second nature to agents but not to you, so ask for explanations until you are satisfied you understand.
10. Be Ready To Buy
- If you aren't ready to buy, you don't need a real estate agent. You can go to open houses by yourself; call listing agents for showings -- but be honest, say you are "only shopping"; look at homes online; but don't waste an agent's time if you aren't ready to act. When you are talking to your agent, be prepared to be with them for a few hours at first. It takes a lot of time to prepare to meet you so please be serious about working with that agent. You do not like your time wasted and neither do we.
- If possible, hire a babysitter to care for children who are too young to stay out all morning or afternoon touring homes.
- Bring your checkbook. You'll need it to write an offer because an earnest money deposit may be required to accompany your purchase offer.
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