Updated from a previous post in Janurary 2015.
To many looking to Buy a Home, a Buyer Brokerage Agreement is not as important as finding the perfect place to call Home. Unfortunately, the signing of this document is not usually done by many Real Estate Agents. The reason? Many are afraid to come across the wrong way and avoid the document altogether. In this post, I will explain to you what this document is and why it is important for you to sign a Buyer Brokerage Agreement with your chosen REALTOR® or Real Estate Agent.
- What is a Buyer Brokerage Agreement?
A Buyer Brokerage Agreement is a legal document that formalizes your working relationship with a REALTOR® or Real Estate Agent. This document details what services you are entitled to as a Buyer (Client) and what your Real Estate professional expects from you in return.
While the language used in the document is formal, homebuyers should view it as an important and helpful tool for clarifying expectations, developing mutual loyalty, and most importantly, elevating the services you will receive. This document represents the official hiring of the Real Estate professional.
- Do I need to sign a Buyer Brokerage Agreement if I am working with multiple Agents?
No. The Buyer Brokerage Agreement is meant to serve as a way to mutually decide to work together in the finding and purchase of your home. This legal document should only be agreed upon and signed with only one Real Estate professional. You signing this document with multiple Agents can cause future legal and financial disputes. Keep in mind this document entitles you to services you would not otherwise receive from your chosen Agent.
- When do I sign the Buyer Brokerage Agreement?
The first thing I would recommend in choosing a Real Estate professional is to do your research. Narrow down your choices and interview them. Once you have chosen a REALTOR® or Real Estate Agent, they will more than likely bring this document up in your first appointment. Do not take this the wrong way. The intention here is to find you a place that meets your needs and future goals. Signing this document immediately without delay only tells the Real Estate professional that you are serious about the purchase and you want to hire them to represent you.
- How do I sign a Buyer Brokerage Agreement?
When you meet with your REALTOR® or Real Estate Agent, they will go over the document in full. There is a good chance that the Real Estate professional that you will be working with will have you sign the document electronically. With today’s technology, signing documents this way is more common practice. Electronic signing of documents are easier, faster, secure and it provides you with a better legible copy for your records. However, there are some REALTORS® or Real Estate Agents that still use paper contracts. If the chosen Agent does this, then you would be signing a paper document.
- Where can I see a sample/draft copy of a Buyer Brokerage Agreement?
A sample/draft copy of the Buyer Brokerage Agreement can be provided for your review by your local REALTOR®. Keep in mind this document can be updated and changed usually yearly, by each individual State Association of REALTORS®. If you are looking for a sample of the document in your own state, please seek the assistance of a REALTOR® in your local area.
Take a look at this additional resource from the Real Estate Buyer’s Agent Council (REBAC), a subsidiary of the National Association of REALTORS® (NAR).
Do you have any questions or comments? Please let me know!