Buyer Agent Agreement
Definition:
A buyer agent agreement is a contract between a homebuyer and a real estate agent, outlining the terms of their working relationship. This agreement typically specifies the duties and responsibilities of the buyer's agent, such as representing the buyer’s interests, finding properties, negotiating offers, and guiding the buyer through the purchasing process. It also covers the agent's compensation, which is often a percentage of the sale price and is usually paid by the seller.
🔍 Did You Know?
In most cases, the buyer does not directly pay their agent’s commission. Instead, the seller typically pays the commission for both the buyer’s agent and the listing agent out of the sale proceeds.
Check out this article on Bankrate to see how recent NAR rulings can impact your buyer agent agreements going forward.
Examples:
Example 1:
A first-time homebuyer signs a buyer agent agreement with a real estate agent, ensuring the agent will represent their interests throughout the home-buying process. The agreement outlines the agent’s role in helping them find the right home, negotiating offers, and closing the deal.
Example 2:
An investor looking to purchase multiple properties enters into a buyer agent agreement with a specialized real estate agent. The agent commits to finding off-market properties and handling negotiations, while the agreement ensures the agent will be compensated when a deal closes.
Why It’s Important:
A buyer agent agreement ensures that the agent is fully committed to representing the buyer’s best interests. It provides clarity regarding the agent’s responsibilities and protects both parties by defining how the agent will be compensated. This agreement establishes trust and transparency between the buyer and the agent, leading to smoother transactions and a better buying experience.
Who Should Care:
- Homebuyers who want professional representation throughout the home-buying process.
- Real estate investors who frequently buy properties and want a reliable agent on their side.
- Real estate agents who want to formalize their relationship with buyers to ensure loyalty and secure compensation.
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