Many consumers are confused by real estate practices and procedures. That's quite understandable considering that most buyers never bought a home before, and many others haven't bought a home in years. There are many consumer protections today that didn't exist a decade or so ago.
One of the least understood parts of home buying is the differences in legal relationships that can exist between a buyer and the agent assisting them. There are required disclosures which help consumers understand that the seller's broker is working on behalf of the seller and must advocate for the seller in a transaction. Confusion sometimes tends to still exist in the roll of an agent not legally committed to the seller.
A real estate agent can help you buy a home without any legal commitment to advocate on your behalf. That is the situation if there is not a written agreement between buyer and agent to be your representative in the transaction. Some agents prefer to work without a written commitment, and, in Minnesota, that is a legal option unless the agent performs any acts as your representative. So, in short, no written agreement, no acts on your behalf. The agent can unlock a door to a listed property and be polite, complete forms, and that's about it.
On the other hand, if you insist that the agent sign a buyer's broker agreement, the agent is bound to certain standards of service and advocacy. The agent is required to act subject to your continuous control, but not exceed the scope of authority conferred by you. Your agent must obey your lawful and reasonable instructions.
Once you have required an agent to sign a buyer's broker agreement, the agent is prohibited from advancing any interests or conduct your business in a way that benefits any party to your detriment. The agent owes you undivided loyalty.
Once required to sign a buyer's broker agreement, the agent must protect you from the foreseeable risks or harm that could result from purchasing a particular property. The agent is required to exercise reasonable care and diligence on your behalf.
An agent, upon signing a buyer's broker agreement is bound to work on your behalf and in your interest in finding the best properties, determining their value, and negotiating the best price and terms. Without a written buyer's broker agreement, none of this will be part of the agent's responsibilities.
The first step in any decision to buy or sell real estate is to gather as much information as possible. You are invited to join me for a real estate orientation consultation. It's free and carries no obligation other than to show up and spend about an hour discussing the real estate market, your expectations, the risks and rewards of buying foreclosures and short sales, financing options, and a few other items. Call now to arrange a convenient time for this consultation.
Comments (4)Subscribe to CommentsComment