What The Buyers Broker Agreement Is NOT For And What It Does.

By
Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

Real Estate Agent Training

Hi guys. I hope ya'll had a good Thanksgiving. This is a follow up to my last post "I hope I didn't "steal" Your Buyer. I was just doing my job".

Ok let me see if I can expand on BBAs just a little bit more. Clear your mind and really think about these things. The BA is not....

  • A BBA is NOT just to guarantee that we get paid. In fact this is probably it's least important purpose.
  • A BBA is NOT designed to replace taking the time to build a lasting relationship with your buyer.
  • A BBA does NOT have to create a fiduciary relationship. In fact we can work under a BBA and still not be an agent for the buyer.
  • Getting a BBA signed is NOT giving us a license to steal another agents buyer.
  • You can choose to work under a BBA in ANY State. I can't imagine any State law prohibiting you from working under a contract.
  • A BBA and an agency disclosure are NOT the same thing nor do they serve the same purpose.

In my opinion, the BBA should be required in all States. What it does is...

  • The BBA eliminates confusion.
  • The BBA lets buyers know that we are serious about our profession.
  • The BBA lets buyers know that we take them serious too.
  • The BBA outlines the entire transaction and make sures we and our buyers are on the same page.
  • The BBA forces us to become better at what we do.
  • The BBA spells out what the buyer can expect from us.
  • The BBA spells out what we expect from the buyer.

I will never understand why so many Realtors(r) consider the BBA unnecessary. Yet none of you would ever consider working with a seller without an agreement. Why is that?

More Helpful Info For Working With Buyers.

***I am NOT an Attorney nor do I play one on TV. Click the button below for my Bio.

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***I am NOT an Attorney nor do I play one on TV. Click the button below for my Bio.

The BIO for Bryant Tutas

 

 Tutas Towne Realty, Inc handles Florida real estate sales, Florida short sales, Florida strategic short sales, Florida pre-foreclosure sales, Florida foreclosures in Kissimmee Florida Short Sales, Davenport Florida Short Sales, Haines City Florida Short Sales, Poinciana Florida Short Sales, Solivita Florida Short Sales,  Orlando Florida Short Sales, Celebration Florida Short Sales, Windermere Florida Short Sales. Serving all of Polk, Osceola and Orange Counties Florida. Florida Short Sale Broker. Short Sale Florida.

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Bob & Leilani Souza 11/28/2010 03:16 PM
Groups:
Real Estate Rookie
Tags:
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buyers broker agreement

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Rainmaker
189,486
Herb Hamilton
RE/MAX Preferred Inc. Realtors - Portland, OR
Real Estate Broker ,CDPE, Downtown Portland

The BBA protects your rights to an earned commission should another agent choose to trespass.

Nov 28, 2010 02:22 PM #16
Rainmaker
1,044,408
Bob & Leilani Souza
Souza Realty 916.408.5500 - Roseville, CA
Greater Sacramento Area Homes, Land & Investments

Broker Bryant, thanks for writing a straightforward post complete with bullet points, explaining the basics of a BBA...I'm going to re-blog this and would have suggested it if it wasn't already featured! :)

Leilani

Nov 28, 2010 03:14 PM #17
Rainmaker
318,971
Tamara Inzunza
RE/MAX Executives - Alexandria, VA
Close-In Alexandria and Arlington Living

I'm with you here bro.  I'd love to see the day when they are required prior to showing any property. This needs to be a permanent feature :-)

Nov 28, 2010 03:19 PM #18
Rainer
163,254
Ryan Case
SCA Real Estate - Anaheim, CA
877-828-0710

It lets the buyer know that they need to be committed to their agent :)

Nov 28, 2010 03:31 PM #19
Ambassador
753,885
Mike Jones
SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) - Tucson, AZ
Mike Jones NMLS 223495

BB,

I can't tell you how many agents ignore this.  I'll get a referral from an agent, and pretty soon, the buyer has jumped ship and I end up doing the loan with a change in my "Selling Agent" field...

Mike in Tucson

Nov 28, 2010 03:41 PM #20
Rainmaker
563,898
Chris Olsen
Olsen Ziegler Realty - Cleveland, OH
Broker Owner Cleveland Ohio Real Estate

Hi BB -- I agree wholeheartedly with you...in theory.

I have never once done a BBA and have only gotten the shaft a few times, and that still would have happened anyway.  While I'm not at 100% sniffing out folks that I really don't want to be involved with, my radar is pretty good and I normally establish a good relationship with them so I don't need it, I've proven my worth to them up front before we even look at the first home and they are 100% loyal to me.  If I can get to 98-99% which I have now, I'm good with that and I think it makes my clients feel more in control and it's a win-win.

I also do short-term listing agreements and sellers can fire me anytime they want, so I don't care much about that as well, as through proper communication and a great service/business model, that becomes a moot point as well.

I'm not saying my approach works in general, but it does for me.

That said, I do agree with you in principle.

Nov 28, 2010 03:47 PM #21
Rainmaker
104,214
Robert Slick
Beach and River Homes - Georgetown, SC
NRBA, RDCPro, Trident/CCAR MLS

BBA and pre-qual letter will get buyers more than a BBA and a smile.

Nov 28, 2010 03:58 PM #22
Rainer
30,892
Ryan Case
Pacific Servicing - Temecula, CA

Its to make sure a buyer is committed to their realtor and agent!

Nov 28, 2010 03:59 PM #23
Rainmaker
414,607
Tni LeBlanc, Realtor®, J.D.
Mint Properties, Lic. #01871795 - Santa Maria, CA
Tenacious Tni (805) 878-9879

You just won't let it go will you Bryant?  LOL.  Nice to hear opposing viewpoints on the matter and I respect the fact that you advocate for your beliefs.  You definitely made me rethink things and helped inspire my Agent Adultery post that ended up getting featured.  Thanks.

Nov 28, 2010 04:33 PM #24
Rainer
384,059
Joan Valverde
Synergy Realty Group Inc - Colorado Springs, CO
GRI,CDPE,CNE,MRP,SRES Colo Sprgs, Blk Forest, Monu
Bryant, very good information indeed. Sometimes buyers feel like signi g is committing them for life. I remind them that they can fire me at anytime, and that seems to give them the okay to sign. I have not lost one yet. :)
Nov 28, 2010 05:16 PM #25
Ambassador
2,008,677
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

I have mentioned before that I think if more agents felt this way, just as they do with listings, then there would no longer be any question of whether or not to lose them.

Nov 28, 2010 06:08 PM #26
Rainmaker
886,050
J. Philip Faranda
J. Philip Faranda (J. Philip R.E. LLC) Westchester County NY - Briarcliff Manor, NY
Broker-Owner

It does create an agency relationship in New York, highlighting again that all real estate is local. 

Nov 28, 2010 11:30 PM #27
Rainmaker
242,038
Roger Johnson
Hickory Real Estate Group - Hickory, NC
Realtor - Hickory NC Real Estate

BB,  a BBA in NC does create an agency relationship.  A non-agency BBA seems a bit confusing to me, but I understand FL's 'Transactional Agent' comes into play there.

That said, your last line says it all.  We'd refuse to work with a seller without their commitment via a contract, yet most fear putting a contract in front of a buyer.  Why?

Moreover, another point that I think many miss, a BBA clearly establishes the relationship between buyer and agent.  State laws may vary, but in NC, I can't draft a purchase agreement as a buyer's agent without a signed BBA.  If I don't have one, then I am a sub-agent to the seller and my duty is to the seller, not the buyer.  So how many agents have been missing where their really duty lies by not having one signed?

Nov 29, 2010 12:18 AM #28
Ambassador
1,726,157
Richard Weisser
Richard Weisser Realty - Newnan, GA
Richard Weisser Retired Real Estate Professional

BB...

What baffles me is that BBAs are the end result of consumer litigation demanding representation, and yet nobody wants to sign one.

Nov 29, 2010 12:19 AM #29
Rainer
34,953
w w
Ogden, UT

It's funny, you don't work with an attorney, or any other professional without signing some sort of agreement, yet nobody wants to sign an agreement with a Realtor. While I don't appreciate how some Realtors use the document as an instrument to "lock in" a buyer, I do think it's important and professional to have some sort of agreement in writing when taking on new clients. 

Nov 29, 2010 01:14 AM #30
Rainmaker
1,560,731
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

This is a great post, and keep them coming!  The comments are  equally thought provoking. 

Nov 29, 2010 05:36 AM #31
Rainmaker
1,023,071
Rob Arnold
Sand Dollar Realty Group, Inc. - Altamonte Springs, FL
Metro Orlando Full Service - Investor Friendly & F

Having someone sign a buyer broker agreement really makes you stand out as a professional in my opinion.  I'm thinking the main reason why people get them signed by sellers and not by buyers is simply because the MLS requires a signed agreement when representing a seller.  Otherwise many brokers probably wouldn't get one signed for that side either. 

Nov 29, 2010 06:26 AM #32
Rainmaker
524,552
Wendy Rulnick
Rulnick Realty, Inc. - Destin, FL
"It's Wendy... It's Sold!"

Bryant - I cannot  understand why more buyer's agents don't formalize their agreements. It also serves the consumer.  Thanks for spreading the word.

Nov 30, 2010 11:06 AM #33
Rainer
68,216
Joseph Michalski
Precision Home Inspection - Souderton, PA
PA Home Inspector

Interesting - I know many REALTORS who don't insist on them, most of them are excellent sales people though, who I can't imagine have buyers wandering around or under the impression that it would be OK to sign with another agent, so that might something have to do with their confidence and work ethic.  Still, "get it in writing" would seem to be a key element in any profession, especially this one.

Dec 01, 2010 03:54 AM #34
Rainer
64,840
Greg Freeman
Citiwide Real Estate Services - Allen, TX

Great post, this is great information, thanks for sharing

Dec 02, 2010 04:52 PM #35
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