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Before you sign an agreement with a buyer broker, consider this: |
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If you do work with a broker consider these points: A. Read the fine print! Many "standard" buyer broker agreements specify that you will work with that particular agent exclusively, and worse, that you owe a fee to the agent regardless of whether he or she shows you the property that you end up buying, and even worse still, that you can't get out of the contract unless it is "mutually agreed upon" by both parties. Don't sign this! If you do, you are signing away your right to look at properties with other brokers as well as to look at private sale properties on your own. Specify, instead, that the agreement pertains only to those properties shown to you by that broker, and cross out any terminology that refers to your having an exclusive obligation to this person (be sure to initial it too). Remember, an agreement is just that -- an agreement between two parties. If the broker is not willing to modify the agreement, find someone else who is. |
| B. If you are working with a buyer broker, it is in your best interest to disclose this to the homeowner when you initially call about the property. We often hear stories of deals that sour as a result of a buyer broker entering the scene late in the game. It usually goes like this: a private seller shows the property to a buyer, has extensive discussions on terms and price, and on a subsequent visit, the buyer brings his/her buyer broker along to "finalize the deal" (sometimes buyers have even hired a broker at this point mistakenly thinking that they needed them for their own protection!). Unfortunately, this often times results in "killing the deal" instead since the broker's fee becomes a point of contention. |
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Why it may be in your best interest not to use a buyer broker: A. You will be at a competitive disadvantage with by owner properties when you are competing for a property with other buyers that do not have a buyer broker working with them if you are not paying the broker's fee yourself. DO NOT EXPECT THE SELLER TO PAY THE AGENT'S FEE! THEY HAVE SPECIFICALLY DECIDED NOT TO USE AN AGENT, SO TO ASK THEM TO PAY AN AGENT'S FEE (ON YOUR BEHALF) IS INAPPROPRIATE. You have just put your offer at a competitive disadvantage...the seller is more likely to take someone else's similar offer...the offer with no agent attached! |
| B. If you are not personally doing the negotiating, you cannot control what is being said. The seller can choose who he wants to sell the property to -- for whatever reason. If the broker's attitude is antagonistic or disrespectful to the homeowner, or if the seller simply doesn't want to deal with an agent, the seller is more likely to award the sale of his home to people that s/he likes and has a rapport with... |
BOTTOM LINE IS THIS:
Many sellers tell us how the purchaser's 'buyer broker' was the most unpleasant part of an otherwise smooth process. Be careful. Make sure that if you are using a broker to help you find a property that you are present when the negotiate on your behalf, that will help keep the atmosphere amiable.
