Buyer Agency

Today I would like to talk about the buyers agency contract. A buyers agency contract is when a buyer hires a Realtor for a certain period of time for the purpose to purchase a home. First, let's look at the scenario of a buyer looking to buy a home without the representation of a Realtor. A buyer goes out looking for homes perhaps on the weekend. The buyer enters the homes that are OPEN and sitting in the home whether it is a conustruction home or a resale home is a sellers agent. The sellers agent represents the seller and is obligated by law to obtain the highest possible price for the seller and to negotiate on his behalf. Legally, that Realtor should disclose agency immediately and advised that you not tell them anything about your financial circumstance that will hurt you in negotiations. However, many Realtors neglect this fact and don't say anything at all. What happens in this case is the Lising Agent (which is the Sellers Agent) is works for the seller and is now in a position of dual agency. This means that he must know split his fiduciary duties to two people (and realistically how can you do this). Now the buyer has no representation no negotiator looking out for his best interest but the Lising Agent makes a 6% commission. Here is where a Buyers Relator Agency Agreement plays a crucial element of your success. You come in with your Buyers Agent and immediately he is looking out for your best interest and he negotiates a price as low as possible for you and now instead of the Selling Agent making 6 % he now makes only 3% because he must give 3% to the Buyers Agent. Now both parties are represented and have a fair chance at working out a deal that is best for both parties. Next time you walk into a place unrepresented at least remember that every time you talk you lose money, every time you show emotions that you like the home you lose money. Don't allow the selling agent to sell you a home without you being represented. This is just a very important point I would like to share with my readers. Until the next post.