Buyer Agency - What Is It?
Why do I need a Buyer's Agent?
By Mike Davis
Relationships between Real Estate Agents and the Buyer and Seller can sometimes be difficult to understand. Who is on my side? To which agent can I disclose my motivations? Which agent will negotiate on my behalf? What is the difference between a Buyer Agent and a Listing agent?
It is very important that the consumer have a full understanding of the duties and responsibilities of the agent, and to whom the agent owes loyalty.
How much extra does it cost to use a Buyer's Agent?
Most of the time, NOTHING.
The most common way a Buyer Agent is paid is the same way other real estate agents are paid: the typical commission paid at closing is usually divided between the listing agent and the agent of the Buyer.
What are the negatives of using the agent that has the property listed?
The agent that has that home listed has a duty to the SELLER. That agent's #1 priority is to get THAT home sold, at the best possible price and terms for the SELLER. A BUYER AGENT'S priority is to help you buy ANY home, at the best price and terms for the BUYER. It's a key difference.
For example: There is a problem with the home inspection; the home inspector reports that the furnace needs to be replaced. What do you think the Seller's Agent will do? Negotiate the best deal for the Buyer, or for the Seller?
An analogy that applies here is: Would you hire the same attorney to represent both sides in a lawsuit? Of course not.
This is called DUAL AGENCY, and is considered so dangerous by some that it is ILLEGAL in some states!
Duties of an agent
Before working with a real estate agent, you should know that the duties of the agent depend on whom the he/she represents. If you are a buyer, you should know that the agent who lists the property for sale is the Sellers agent and represents only the Seller. The agents job is to get the SELLER the highest price and the best terms.
If an agent represents the buyer, the agent becomes the buyer's agent by entering into an agreement to represent the buyer, usually through a written buyer representation, commonly referred to as a buyer's agency. The Buyer agent is legally obligated to try to get the best terms and conditions possible for the Buyer.
* Remember: The Listing agent has legal obligations to work for the Seller. They must try to get the best terms and conditions possible for the Seller. They must tell the Seller everything they learn from you that can put the Seller in a better position. The Buyer agent has the opposite obligations. He/She works for the Buyer.
There are other situations in which the agent doesn't represent either the Seller or the Buyer, or represent them in a very limited way. Again, this is either called Dual Agency. This situation most commonly happens when a Buyer calls the Seller's Agent about a home that that Agent has for sale, and then buys it. An agent can never fully represent both the Buyer and the Seller in a transaction as their agent at the same time.
* Some Buyer Agents have decided to work only for Buyers. They are called Exclusive Buyer Agents and they will always represent the Buyer in a transaction, from start to end.
Do Buyer Agents have access to all properties?
Some people might be concerned that the Buyer agent won't have access to all properties for sale. It is normally quite the opposite. Almost all agents have access to the same computerized information, normally called the Multiple Listing Service (MLS). A good Buyer Agent, opposite to a Listing Agent, can also help you buy "For Sale by Owner homes" or New Homes from a builder. When you choose a Buyer Agent, make sure that he/she has access to the Multiple Listing Service (MLS) for the areas you are interested in. And remember, a Buyer Agent can help you buy ANY home for sale, no matter if it is listed with a real estate company or not.
A good Buyer Agent will help you locate good regional recourses that you will need as a part of your home purchase such as Lawyer, Lender, Home Inspector, Insurance Agent and others.
If you would like me to represent you as Buyer 's Agent, please call me at 801-698-8288, or email me at firstname.lastname@example.org .
REMEMBER - In most cases, it costs you nothing extra to have me as your BUYER AGENT.