Recently an offer came in on one of my listings from an experienced, seasoned, competent, and well-regarded buyer's agent from a well-known, well-respected firm. As many offers are these days, the price was low, the closing cost credit was high, and the inspection contingencies were rigorous.
On this particular listing, the seller was offering a somewhat less than standard coop to the buyer agent. When the agent expressed shock and dismay about the amount we were offering, I decided on the spur of the moment to get into it. I asked "Who are you working for?" The reply came quickly and with some indignation, "Why, the buyer of course!"
And I just couldn't help myself. "Then why should the seller pay you anything? You probably have a contract with the buyer that says the buyer will pay for your services. If you are going to beat the seller up on price, concessions, and condition, why should they pay you at all? If you were getting sued, would you expect to pay your opponent's attorney as well as your own?"
However, the paradigm that assumes the buyer agent's fee comes from the seller is so ingrained in our belief system that this agent could not conceive of getting paid any other way. I'm sure that this belief applies to many, if not all, of us.
Now before you get all militant about what I've just said I want to point out that I have great respect for the buyer's agent. Having often been one myself, I think we do a good job and provide a valuable service. My only concern is how we get paid.
I've been around long enough to remember when buyer agency first became popular. Before that, we were taught that we all worked for the seller because that's who was paying us. That principle was taught in our pre-licensing class and reinforced in the training we received from our first brokers.
When we first started admitting that we were really representing the buyer when we worked as selling agents, the BIG question was how we would be paid. Most trainers told us that, of course, the buyers would pay us. And that's how our standard buyer agency agreement is written in Northern Virginia.
Somewhere along the way, we stopped asking the question. Now we avoid pointing out to buyers that they owe us our commissions based on the buyer agency agreement. The seller calmly pays us, very often without even questioning the logic in it.
I want to question this logic. Isn't it time buyers started asking how their agent could truly represent their interests when they are being paid by the other side? Isn't it time for sellers to start questioning what they are paying for when they agree to pay a coop?
Isn't it time we told our buyers the truth about who is supposed to pay us?