First Time Home Buyer Article 7 of 10 Understanding Who Real Estate Agents Represent

Posted on | August 14, 2009 | Written by: Diane Donnelly

Now that you have found a realtor who fits your needs, it is important to understand who realtor’s represent. You want to find a realtor that is loyal to you and, in return, he will ask that you be loyal to him/her.

In the early days of my career, I would meet with prospective home buyers and they would tell me that were working with a few realtors. A few realtors? Do they each know that? Because of the few realtors that they are working with, only one of them is going to get paid for the work being performed. Imagine going to work for a month only to find out that you aren’t going to get paid. Yikes. You wouldn’t be able to continue doing that for long.

So, I want to discuss ways a realtor can represent a prospective home buyer:

First, an agent can represent the buyer through a written agreement called a Buyer’s Agency agreement. This authorizes the agent to represent your best interests, not the interests of the seller. Click here to see a blog on the topic of Agency.

An agent can represent the seller. When an agent lists a home for sale, he has signed a listing agreement with the seller authorizing him to represent the best interest of the seller. Therefore, if you go into an open house and are greeted by a realtor, he is working for the best interest of the seller and any information you share with him, can be shared, and should be shared with the seller.

A brokerage can be a dual agent. This means the brokerage i.e. Keller Williams is the listing agency and the selling agency. In order for the brokerage to be a dual agent, a dual agency agreement must be signed by both the buyer and the seller.

If you would like representation from your realtor and you sign a buyer’s agency agreement, read it carefully. I like to call this type of document a loyalty agreement. It outlines the responsibilities of the agent and of the buyer. Each agency agreement is different, but I have enclosed a copy of ours for your review. Anne Arundel County Buyer Broker Agreement

Some things to be conscious of after signing a buyer’s agency agreement:

· If you go into an open house you must be escorted by your agent

· If you see a house that is a for sale by owner, the agent would need to make contact with the seller to see if they would be willing to pay a commission.

· If you go into a new construction community, you must be escorted by your agent.

The agent owes you Confidentiality, Obedience, Accountability, Loyalty, and Disclosure. This can be a topic in and of itself, but to keep this blog short enough to hold your interest, suffice it to say that an agent, acting under a buyer’s agency agreement, has a fiduciary responsibility to keep your best interests in mind at all times.

Again, I want to stress that each agency agreement could be different and it should be read in its entirety and understood completely before signing. As with all contracts, it is important to take the time to understand what you are agreeing to.

As a realtor, I have made the decision to work with buyers only after a buyer’s agency agreement has been signed. It helps me to stay on the same page as my buyers and sets clear and concise expectations for us both.

If you know anyone looking to buy his or her first home, please share this blog with them! There are only 79 days as of this writing, to take advantage of the $8,000 first time home buyer tax credit.

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