Q: What is the difference between a buyer's broker and a traditional real estate agent?
A: A buyer's broker (also called buyer's agent) is a real estate agent hired by the buyer to represent his or her interests at no additional cost. Traditionally, real estate agents have listed property for sale and formed a legal relationship with the seller. Buyers who desire to have their positions advocated, and have the agent negotiate on their behalf, can now hire agents to represent them. A professional Buyer Broker may/may not list property- to avoid conflicts of interest. Back to Questions
Q: Does the buyer's broker have to be paid by the buyer?
A: The buyer's agent can be paid by anyone ---the buyer, a third party, or a Buyer's Agent could receive the co-broker (selling broker) share of the commission offered by a listing broker through the multiple listing service. This last method of compensation is typical in a high percentage of buyer agent sales nationwide. After all, the compensation is part of the appraised value.
Q: Do traditional agents represent buyers legally?
A: If a listing agent agrees to represent the seller exclusively, the listing agent cannot legally represent the Buyer on the same property. Back to Questions
Answer: I doubt that your true desire is to see "everything available"---but to find several of the best prospects from which to choose. Working with a real estate agent can accomplish that for you. Enlist a Buyer's Agent.
A Buyer's Agent will listen to your needs and search through properties available (from the multiple listing service), weeding out the inappropriate ones. He or she will probably then show you several to get your feedback, and repeat the process again until you find the right home. Additionally, the agent is informed of new properties as they become available and also those which may be for sale shortly. What could end up taking you months on your own can be done in a timely and cost effective manner with the help of an agent. Be wary of an agent showing you only their company's listings.
One suggestion: Be candid with your feedback to the agent. When you see something you don't like, explain why. Point out features you do like in the homes you see. This can greatly assist the agent.
Inform the agent if you are not satisfied with his or her service. Believe it or not, you will be best served by dealing with only a committed Buyer's Agent/Broker, versus "shopping the field" with a variety of agents and brokerages. If you make the agent aware that you are committed to work with him or her, there is no reason why the agent won't do all in his power to work diligently with you as a Buyer. Back to Questions
Answer: It's not only all right, it's a great idea. The listing agent probably did a comparative market analysis (CMA) before listing the property. This compared the property you're interested in to sales prices and terms of properties recently sold (usually within six to twelve months). These comps were similar in size, style, and amenities to the subject property and helped determine its listed price.
The listing agent would need to get permission from the seller in order to show you the seller's CMA (since it was prepared for the seller/client). However, there would be nothing wrong with another agent, a BUYER's Agent using information from other sold properties from brokerage files or from the Multiple Listing Service information to show you a range of values in the area. This information is usually accessed through a computer database, and is up-to-date. Be smart---find a Buyer's Agent/Broker to represent your needs, and avoid these conflicts/questions. Back to Questions
A: Not only was this ethical, it was legally correct as well. The listing agent is employed to represent the seller in marketing the property. They form a legal relationship, based on trust, honesty, and diligence. In fact, anything the agent knows that might affect his client's position must be communicated to the client. This relationship with the seller filters down to include brokers and agents from other offices who would show the property as subagents of the listing broker and seller.
It's the law in forty-eight states that the real estate agent must explain whom they represent to all parties in the transaction. If this was done, it should have been reclarified when you "volunteered" the information. It sounds like agency disclosure in general was not adequate based on your degree of surprise after revealing what you'd offer.
In addition, you had the right to seek representation of your own, should you require it. You should consider enlisting a Buyer's Broker, as your agent to represent your interests, or seek counsel from a real estate attorney, at no cost to you, if possible. Back to Questions
Q: Can any real estate agent be a Buyer's Agent?
A: Yes! Any licensed real estate agent in California may be a Buyer's Agent. However, before you hire an agent, check the experience the agent has in buyer agency transactions.
Q: The last time I bought a home, I believe my agent really looked out for me. Why would anything be different today?
A: In the past, there was a lot of rule bending. Agents believed they had to take some risks in order to obtain referrals and future business from you. In today's litigious environment, real estate agents must be much more cautious. The only way to ensure an agent is representing your side is to hire a Buyer's Agent via an Exclusive Right to Represent the Buyer Agreement the same as the seller does when he secures his agent via an Exclusive Right to Represent the Seller Agreement. Back to Questions
Q: If this is so good for the consumer, why aren't all real estate agencies offering Buyer Agency?
A: Companies across the country are reluctantly changing their methods of doing business to accommodate the increasing consumer demand to be represented by a Buyer Agent, the same as the seller is represented by the listing agent when the seller sells a home. Back to Questions
Q: Won't I get a better deal if I buy directly from the listing agent?
A: ABSOLUTELY NOT!!! The
listing agent's loyalty is owed to the seller, and the listing agent cannot,
therefore, legally get the Buyer a better deal. Although some Buyers believe
the listing agent should be willing to take a lower commission, because
the agent does not have to share it with another agent, they fail to consider
the matter of legal representation and fiduciary relationships. A
listing agent, in that scenario, has a potential conflict of interest and
twice the amount of work. Also, if there is not another agent available
to help with the Buyer, the listing agent may or may not be unwilling to
give up the commission on a well priced home.
Back to Questions
Q: What other differences can I expect from a Buyer's Agent?
A: When you hire a Buyer's Agent, the entire home finding
process changes. Rather than trying to sell you one of his Company's listings
and/or the good points of the properties, a Buyer's Agent will bring logic
versus emotion to your decisions, pointing out all of the positives and
negatives of a home. Those aspects/features that will hinder your selling
the property in the future will be pointed out. A Buyer's Agent should
also prepare a contract with better terms and conditions and a contract
that favors the Buyer's movein and possession dates. A Buyer's Agent will
look more diligently for homes that favor/meet your needs, such as a FSBO,
and properties not yet on the market. A Buyer's Agent should be willing
to be on your side throughout the entire process. If not, you, the Buyer,
are in "harms way". BEWARE IS BEING AWARE!
Back to Questions
Q: Can my agent list my home and also be my Buyer Agent?
A: Some Buyer Agents work with Buyers and sellers. If the same agent lists your home and helps you find another, make certain you have signed a Buyer Agency Agreement, and you have checked to make sure the agent is proficient to handle both. Some agents specialize as Listing Agents; they do not wish to deal with Buyers, work on weekends, or keep up on the other inventory on the market.
