Ask any buyer’s agent who has been practicing real estate for a while, and you’ll hear sad stories from those buying agents who wished they had signed a buyer to a buyer’s broker agreement.  I wanted to take time with you on this blog post to allow you to understand just how problematic NOT SIGNING a buyer’s broker agreement can be for both a buyer and a Real Estate agent.

In defense of buyers, it’s RARELY their fault… I’ve experienced first-hand how a Real Estate agent can forget to explain “how” the business side-of-things ACTUALLY works to clients.

Buying Real Estate Is REALLY A Simple Process

What often happens is an agent will work with a buyer for a few weeks to several months or longer. The action items of what a Buyer’s agent often does includes:

• Introducing the buyer to lenders and obtaining loan approval letters.
• E-mailing listings that fit the buyer’s requirements
• Calling listing agents to determine availability for showings.
• Making appointments with a seller’s listing agent before showing homes.
• Driving the buyer from one neighborhood to the next, (sometimes touring 10 homes a day).

There’s nothing worse than have a buyer call… And in breathless excitement, announces that he and his wife had driven by a new subdivision, stopped to look at a model home and signed a contract to buy a new home from the builder.   This situation is THE FURTHEST THING from fabulous for a buyer’s agent — it more-or-less a termination agreement.

Just as listing agents sign formal listing agreements with sellers, buying agents EXPECT formal agreements, too.  Like listing agreements, BUYER’S BROKER AGREEMENTS ARE TYPICALLY BILATERAL, which spell out the rights and duties of both parties.  Because bilateral contracts are essentially a promise for a promise, if the agent doesn’t perform, you may have the right to fire the agent and take your travels elsewhere.

USING A BUYER’S AGENT HAS NO COST, EASES NEGOTIATIONS, WILL MAKE SURE THE “PROPERTY AT HAND” HAS CORRECT COMPARITIVE MARKET EVALUATIONS, AND YOU GET TO LEVERAGE THE AGENTS TEAM FOR FREE
(If you’re a SERIOUS buyer – sign a Buyer’s Broker Agreement as soon as possible)

 As for finding a qualified agent you can trust — nothing beats a referral.  However, buyers who are relocating to a new area RARELY have the luxury of building contacts quickly enough to trust a referral source.

• Internet Searches

By finding online listings of homes for sale, a buyer can quickly figure out which agents in certain neighborhoods list (or like me, represent the ability to sell) most of the homes.

Many times, people on a quest to purchase a new home will type various keyword phrases into search engines.  There is more-and-more evidence supporting the use of “real estate resource sites” where agents maintain profiles such as Realtor.com, Trulia, Zillow, and Active Rain.

• Open Houses

An agent hosting an open house may or may not be the listing agent — YOU SHOULD ASK for this knowledge.  Open houses provide an excellent opportunity to interact with the agent and find out more about the agent’s preferences, unique skills, and “hot tips” in the current market. If a certain agent appears knowledgeable and your personalities mesh, ask for a business card… Then later, look up the agent’s Web site for more information.

If you can help yourself, TRY NOT to purchase a home from a seller’s agent representing a property at an open-house. (They have a fiduciary responsibility to get “top dollar” for the seller’s property.  So, in other words, they don’t possess your best interest.)

Does Signing an Exclusive Buyer’s Broker Agreement Make Sense?

Little turns off buyers faster than an agent from the Internet who e-mails a buyer’s broker agreement before meeting in person. ALTHOUGH IT’S COMMON FOR AGENTS TO EXPECT A BUYER TO SIGN A BUYER’S BROKER AGREEMENT, most buyers need to feel comfortable with an agent before signing and relinquishing control of their ability to “roam” FREELY.  I can’t blame them.  Working with the WRONG Real Estate agent can cause endless inconveniences and ongoing let-downs.

I always recommend interviewing a Real Estate agent for folks “on the fence.”  It’s a great strategy EVERY buyer should experience and it helps to ease the uncertainty of the “great unknown” that’s sure to knock-on-your-door during your transaction at some point.

Understandably so, MANY BUYERS are leery of signing agreements because they are concerned that the relationship might not work out long term — they don’t want to be stuck with a crummy agent… How can you blame them?

Here are 4 PRECAUTIONS you should take to relieve “Buyer’s Remorse”:

• Ask For Short-Term

The term of a buyer’s broker agreement is negotiable.  Although many agents might request a 90-day commitment at minimum, you are free to ask for a 24-hour, seven-day or 30-day term; it’s whatever you can negotiate – get creative – there’s a lot of unique deal –making taking place these days amongst agents and their clients.

• Compromise

You can tell the agent that you prefer to spend a little time getting to know the agent before signing an exclusive buyer’s broker agreement.  It’s reasonable to say, “Let’s spend an afternoon looking at homes, and if I think we can work together, I will sign an agreement with you before we go out again.”

I would caution against working with an agent who is too eager to work with you before she has interviewed you, as well… Being “professional” goes a long way on this one.

• Specify Areas and Terms

Most contracts contain a description of the property. If you are undecided about areas, you might want to specify the terms and area in the contract, which will allow you to work with other agents in other areas or at different terms.

For example, you might specify a price range or a neighborhood.  If you later decide you do not want to buy a home in that price range or in that area you can always alter  your current agreement if you wish to add other towns or change the price ranges.

• Ask For a Guarantee

I GIVE ALL MY CLIENTS A GUARANTEE. Many Real Estate agents will accommodate that request if asked but that means it’s a two-way street. I guarantee buyers that if either of us decides the relationship IS NOT WORKING out or our personalities clash, I will release them from the agreement, and they can do likewise.

This way you’re not “held hostage” to your business arrangement if your agent is too pushy, argumentative, or stubborn … So be bold, stay clear and continue to push the “free line” while on your quest to finding the best buyers agent for you.

To NEVER settling for less in a buyer’s agent,

Greater Boston Real Estate Authority
Quality Service Pinnacle Award Winner
(617) 775 – 9167 | Click To Email Me