Let me start by saying I know this post is going to evoke some strong reactions from both other real estate estate agents in Palo Alto as well as around the country. It may also evoke some strong reactions from home buyers in Palo Alto and around the country. Please let me explain that in my 19 years as a Palo Alto real estate agent I have learned that there are many right ways to do things. I do not use buyer brokers agreement. This is how I like to run my business. How other people do it is their business. If it feels right to a future home buyer who is reading this great, if not then feel free to contact someone else.
Ok, so what is a buyer's Broker agreement? Some Palo Alto real estate agents will ask their clients to sign a contract saying that during a specific period of time the client agrees that if they buy a house from anyone, the Palo Alto real estate agent they have this agreement with will get paid a commission of no less than x%. So even if the buyer finds a for sale by owner home, a new home where the builder is not paying the buyer's agent a commission, or decides to use a different agent the Palo Alto real estate agent who signed the agreement gets paid by the buyer.
In exchange for this financial obligation the Palo Alto real estate agent will promise to do a number of things. The most import is usually work diligently to find a home, get the best deal possible, and pledge allegiance to the buyer.
The pluses on this agreement are that both parties are contractually committed to each other so the buyer knows the Palo Alto real estate agent has put in writing how hard he or she will work. There will be no slacking.
The Palo Alto real estate agent knows the client will be loyal and his or her work will not be wasted because if the buyer finds a home the agent will be paid.
I do not work like this. I always tell my buyers this relationship is like living together, incredibly close and mutually beneficial, but we can split up easily. First of all, I don't even consider that we are in a relationship until we have a few dates. We need to spend some time together, see some house, see if we get each other. Do I understand what you want? Do you like the way I communicate, my hours, my way of helping you? If so then we can become exclusive. I am your only Palo Alto real estate agent and you promise not to cheat on me. If during our "living together time" something goes wrong and you don't like me anymore I just ask that instead of suing me to get out of the contract, just fire me. We will both be much happier.
If that works for you then we can go on a date, if not, it was great meeting you and best of luck on your home search!
If you ask me to be your agent there will be no buyer broker agreement in writing. if you meet a Palo Alto real estate agent who wants you sign a buyer broker agreement I hope this has given you some food for thought.
If you have any questions about buying a home in Palo Alto please feel free to contact me.
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