Well a couple of weeks into the big change in real estate and we see a lot of confusion. As much training and webinars as were available from every angle and many agents and managers just did not pay attention.
Forms have changed and things need to be done differently, but some people have not made the change or just did not listen. We had a meeting in our office today to discuss what we are all seeing in practice as we represent buyers and sellers. Are agents answering their phones? How are they sharing offers of compensation, if at all?
First, you need a buyer agency contract signed by your buyer that specifies what you are charging your client for your services, before you can show a home. This can be a flat fee, or a percentage, and once that amount is specified you cannot receive more from anyone.
The MLS offering of compensation over the previous years allowed many to lay aside Broker Compensation Agreement forms as it was shown in the MLS. Now with no compensation shown, we need to use these forms when compensation is offered by the listing broker. It is not illegal for a seller to offer to pay the buyer broker a fee to represent the buyer and many sellers in our area are doing exactly that seeing the benefits of marketing to the widest number of buyers.
Buyer agents, are misusing the new agreements of sale, inserting compensation into the seller concession field when they already have a signed broker compensation form, the agreement of sale has never had compensation entered into it. This would actually result in a double compensation. How this element should be used is if the seller has offered through the listing broker an amount less than what the buyer has agreed to pay their buyer agent. Then the buyer can ask for a seller concession to cover the difference.
Alternatively, a buyer can agree to pay their buyer agent as agreed and the buyer agent can reject any offer of compensation from the listing broker netting the seller a larger net amount for their house.
Mortgage Brokers also are adjusting to the changes as they now need to confirm how the buyer agent is getting paid and if the buyer is paying any of that compensation.
All this will get worked out as time passes and people get used to the new forms, but it will take time as even managers and brokers are confused right now. Just take a deep breath, stay calm and carry on. Build rapport with the other agent, you do not have to beat them over the head, just explain your understanding and how your brokerage understands the forms use.
In a few weeks, full time, hard working agents will be used to the forms and how to use them. Those part time agents or those who only do one or two deals a year may struggle longer, but they too will eventually get it. No change is ever easy, but we are all here to help our clients achieve their real estate goals and that is what cooperation is all about.
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