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It is Legal in VA For Me to Work With Buyers Without Written Agreement

By
Real Estate Agent with RE/MAX Distinctive / LIC in VA

If you're a potential buyer in Virginia, you've probably heard the statement " It is illegal for me to work with buyers in VA without a written Buyer Broker Agreement". You've probably also seen a similar statement posted on many agents websties. I'm working with buyers now that were told that by more than one agent. They told me agents they had talked to refused to do anything unless they signed a BBA. Another agent told them they had to come into their office, sign a BBA, and meet with their in house lender before they could help them.

 Well, that might just be how those agents choose to operate their business. But the fact is, no homebuyer  in VA has to sign anything when they are screening agents, or seeking to find out general information about the local area and local housing market.

 And it is not illegal for agents to provide that information without a written and signed BBA.

 Here is a partial list of acts and/or services that I can provide to any potential homebuyer in VA without me asking or telling them that they have to sign a BBA before I do so.

(1). Showing houses- Yes, I can show houses without a signed BBA.

(2). I can provide CMA's without a signed BBA.

(3). I can provide MLS search results without having a signed BBA.

(4). I can provide info on typical housing features you can expect to find without a signed BBA.

(5). I can provide information on schools, HOA's, taxes, etc without having a signed BBA.

 But, this is assuming the buyer is researching and gathering information for their own knowledge, and that have not yet indicated that they are asking about these services with the intent of hiring me as their agent to purchase real estate. It is my responsibilty to know what questions I can and can't answer during any of those procedures. At any point during me providing items 1-5, a buyers intent can change. So if a buyer starts asking me questions that require me to provide advice, counsel, professional judgment, etc, at that point, if they decide they want me to be their agent, and indicate they are ready to move forward with purchasing real estate, I will explain the law requiring a written and signed BBA and how it works, and once they sign it, they will go from being a customer to a client.

 

Jeff Pearl | Lic in VA

Remax Distinctive | McLean VA

703-727-4876

Homes | Land | Farms | Historic

www.jeffpearlhomes.com

 

Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

Can you help them write an offer without a BBA?  Is there some point at which you have to get it signed? by law?

Jan 11, 2015 09:02 AM
Jeff Pearl
RE/MAX Distinctive / LIC in VA - Lovettsville, VA
Full Service Full Time Realtor

#1- Hi Tammy, if they decided to pursue a purchase , I would be required to have a wriiten agreement.  So yes, the law would come into play.

Jan 11, 2015 09:17 AM
Pete Xavier
Investments to Luxury - Pacific Palisades, CA
Outstanding Agent Referrals-Nationwide

Very interesting on how it works in Virginia and in regards to the law. Here in California we could employ it's use at any time or not at all.

Jan 11, 2015 12:48 PM
RVA HomePRO Michael Hottman
RVA HomePRO Realtor with Keller Williams serving Hanover, Henrico, Chesterfiled and Richmond, Virginia - Glen Allen, VA
Helping you achieve goals in life & real estate

I cannot discuss material facts about a property without a Buyer's agency agreement. Yes I can allow access to a home, I can share any readily public information about a property (Price, bed/bath, association dues, schools, amenities, etc.) but when it creeps into proprietary information (we can afford $XX dollars do you think the house is worth it? Do you think the seller would take that? I can't answer those questions. When we start sharing our opinions and expertise that's when it turns into an agency relationship and we need a buyer's agency agreement. 

Jeff Pearl I agree with most of what you say and examples, however I think if you were to put together a CMA you are likely crossing that agency line because you are starting to interject your opinion as far as what are comparable properties and such. At least that's the opinion of our Association's Counsel.

Jan 11, 2015 01:08 PM
RVA HomePRO Michael Hottman
RVA HomePRO Realtor with Keller Williams serving Hanover, Henrico, Chesterfiled and Richmond, Virginia - Glen Allen, VA
Helping you achieve goals in life & real estate

When we start to "Promote the interests of the buyer" then we are creeping into the agency/borkerage/representation role. See this link to the Virginia Code

And a direct quote from the code: 

§ 54.1-2138. Disclosure of brokerage relationship.

A. Upon having a substantive discussion about a specific property or properties with an actual or prospective buyer or seller who is not the client of the licensee and who is not represented by another licensee, a licensee shall disclose any broker relationship the licensee has with another party to the transaction. Further, except as provided in § 54.1-213954.1-2139.154.1-2139.2, or 54.1-2139.3, such disclosure shall be made in writing at the earliest practical time, but in no event later than the time when specific real estate assistance is first provided. 

Jan 11, 2015 01:20 PM
Jeff Pearl
RE/MAX Distinctive / LIC in VA - Lovettsville, VA
Full Service Full Time Realtor

#3- Hi Pete, it use to be that way here until 2012. They were almost impossible to enforce.

#4- Hi Mike, Exactlt Mike. We agents need to know where that line is, explain to potential buyers upfront about the law that prevents us from crossing that line without a signed BBA.

#5- Yes Mike, we have to be careful to only discuss general information and keep our opinions and judgment out of the conversation until they are ready to sign.

Jan 11, 2015 09:24 PM
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

I've always suspected that the claim that buyers must sign a written agreement was started by listing agents to drive buyers to themselves to look at homes for sale.

At a seminar at the Loudoun County board, the explanation was simple, "If you're working with a buyer, you're a buyer's agent."

Agents want the BA Agreement because most of them require that, even if the buyer buys with another agent or listing agent, that agreement requires that the buyer pay that agent.  Of course, it's not automatic.  The agent would have to sue for it.

Jan 19, 2015 12:23 AM
Jeff Pearl
RE/MAX Distinctive / LIC in VA - Lovettsville, VA
Full Service Full Time Realtor

#7- Hi Lenn, I've seen both. Listing agents that think because they answer some questions to a potential buyer, they think  pressure that person to sign a BBA will lock them in and keep them from talking to other agents. And buyer agents who don't want to fully explain a BBA think they can lock in a buyer with the " It's illegal for me to help you without a BBA..." claim.

Jan 19, 2015 07:39 PM