Real estate brokers and buyers

28Apr07

Services provided to buyers:

* Buyers as clients

With the increase in the practice of buyer brokerage in the US, especially since the late 1990s in most states, agents (acting under their brokers) have been able to represent buyers in the transaction with a written “Buyer Agency Agreement” not unlike the “Listing Agreement” for sellers referred to above. In this case, buyers are clients of the brokerage.

Some real estate brokerages choose only to represent buyers in an exclusive buyer’s agency relationship and do not take “listings” from sellers.

A real estate brokerage attempts to do the following for the buyers of real estate only when they represent the buyers with some form of written buyer-brokerage agreement:

* Find real estate in accordance with the buyers needs, specifications, and cost.
* Takes buyers to and shows them properties available for sale.
* When deemed appropriate, prescreens buyers to ensure they are financially qualified to buy the properties shown (or uses a mortgage professional to do that task).
* Negotiates price and terms on behalf of the buyers and prepares standard real estate purchase contract by filling in the blanks in the contract form. The buyer’s agent acts as a fiduciary for the buyer.

Due to the importance of the role of representing buyers’ interests, many brokers who seek to play the role of client advocate are now seeking out the services of Certified Mortgage Planners, industry experts that work in concert with Certified Financial Planners to align consumers’ home finance positions with their larger financial portfolio(s).

* Buyers as customers

In most states, until the 1990s, buyers who worked with an agent of a real estate broker in finding a house were customers of the brokerage, since the broker represented only sellers.

Today, state laws differ. Buyers and/or sellers may be represented. Typically, a written “Buyer Brokerage” agreement is required for the buyer to have representation (regardless of which party is paying the commission), although by his/her actions, an agent can create representation.

* Find real estate in accordance with the buyers’ needs, specifications, and affordability.
* Take buyers to and shows them properties available for sale.
* When deemed appropriate, prescreen buyers to ensure they are financially qualified to buy the properties shown (or uses a mortgage professional to do that task).
* Assist the buyer in making an offer for the property.

Filed under: Broker   |  Leave a Comment