Buyer Representation Agreements


All real estate agents, including this one, appreciate loyal customers. Customers, in turn, appreciate the hard work a knowledgeable real estate agent will do. Yet, should you be contractually bound to an agent whom you have “hired” to find you a property?

This is a question that buyers and agents alike have been wrestling with for decades.

Personally, I believe that the relationship that a buyer has with their Realtor should be at will. As a believer in the free market system, I will gamble that my service alone will be enough to distinguish me from my competition and that my customers will continue to use my services and refer their friends to me.

Many agents will try to get their customers to sign lengthy agreements in order to protect themselves from “disloyal” buyers. While it is frustrating to spend days with a customer only to have them buy their home through another agent, there are many reasons why this may take place. There are as many reasons as there are people and I am not going try to explain those complexities here. Suffice it to say that I never ask my buyer clients to sign lengthy contracts with me.

If you are comfortable about your relationship with your agent and you are comfortable signing a long term agreement with them, by all means, follow your heart. Just go into it with your eyes open, knowing that you may not be able to sever that relationship lightly should something go wrong. I have dealt with more than a few buyers who could not get out of a buyer-broker agreement with an agent or brokerage they no longer wished to do business with. I was powerless to assist them even though they preferred to work with me.

Sign with caution.

I do use a written buyer-broker agreements with every client, but I limit the agreement to a single transaction beginning and ending with the escrow we just opened and only for the property being purchased. This protects me from quirky legal idiosyncrasies inherent within our Multiple Listing Service and it protects the buyer from being tied to me for any period of time longer than it takes to close the transaction at hand.

I never try to force a relationship. I never ask my clients to sign buyer-broker agreements for longer than it takes to close a single escrow. This is just my way of doing business.