[photopress:blue_moon.jpg,thumb,alignright]Once on a Blue Moon, I need to insist that a buyer, if I am going to work with them, sign a buyer agency agreement.
1) When assisting them in their home search requires that I go inside every property to ascertain if the property has what they need.
Example: must have first floor bedroom that is NOT the master bedroom, but is large enough for two people to be comfortable and have it’s own bath and be on the same floor as the washer and dryer. This is a common request for multigeneraltional families whose parents live with them and do their wash š I can’t tell all of this from mls data and have to preview lots of homes quickly and all new on market homes to make sure the first floor bedroom is not tiny and to make sure it is in reasonable proximity to the washer and dryer.
2) When I am asked to find property that is not for sale.
Example: Must live on the SE corner of the Newmark Blding on any floor higher than the 12th floor. When someone wants something that is so very specific that it requires that I contact all owners of those properties. Waiting for this to come on market is not in the best interest of the buyer, unless they are willing to wait five years to buy something (which sometimes is the case, and that’s OK). If they won’t buy anything else until they realize they can’t have what they really want, and they need a place within 6 months, then I have to contact every owner of that “commodity” and ascertain if it is a dead end and no one is thinking of moving this year. P.S. I rarely negotiate a lower commission for this type of home search. I need a written Buyer Agency contract to establish for the seller’s benefit, that I do NOT work for them, but the buyer, and so need a written contract saying that.
There are a few other examples, but I think you get the picture.
A very wise Broker once told me that once you have the meeting of the minds with a client that the relationship is exclusive…you don’t need a written contract. So as soon as someone is WILLING to sign one, you simply shake hands and acknowledge the meeting of the minds and don’t insult the client by requiring a contract.
Until there is a meeting of the minds, the contract is inappropriate, since a contract is putting on paper that meeting of the minds.
So either way, I do not need a written contract by and large, with some exceptions.
My$.02…YMMV
I’m in the biz way down in a small town in Arizona, so this may not apply to you fine folks in Seattle, but I’ll add my $.02 anyway.
Like you I don’t use the buyer broker contract all that often. I do however use it for control purposes. For instance when a buyer shows up at my office with a list of 10 homes they want to see right away. I’ll pull out the document and review it with them letting them know that I would be happy to show them the homes if they are interested in purchasing a home that would fit their needs. Sometimes I don’t work with people I don’t know all that well and I like to have some control over the client. Sometimes the list of homes includes offerings that don’t compensate through MLS. I deliver a certain standard of service but to get to that level we have to work on terms I am agreeable with.
In Arizona we can ask for a retainer fee, up front, payable to the broker and that amount does not have to be credited to any compensation in a transaction. While I haven’t collected a retainer fee as of yet, I think sometime down the road it will be a regular practice.
Great blog you folks have, I hope to visit on occasion and comment.
Great post, Ardell, you rock. There is a kind of contractual nirvana reached when everyone realizes we have attained a “meeting of the minds”.
However, the purpose of signing a contract is usually to cover a completely different portion of the anatomy.
Cheryl,
I remember training a newer agent down in L.A, and he kept wanting me to teach him how to get a Buyer Agency Agreement signed. I kept wanting to train him how to earn the RIGHT to get one š
Student of the Market first and foremost! It’s like never handing out my business card until someone asks me for it. They should ask for my card by what I’ve said in our conversation. When someone leaves an Open House and turns or comes back and says “Can I have your card?”, I know I don’t need to pull out the Buyer Agency Agreement and the pen.
Cheryl,
I remember training a newer agent down in L.A, and he kept wanting me to teach him how to get a Buyer Agency Agreement signed. I kept wanting to train him how to earn the RIGHT to get one š
Student of the Market first and foremost! It’s like never handing out my business card until someone asks me for it. They should ask for my card by what I’ve said in our conversation. When someone leaves an Open House and turns or comes back and says “Can I have your card?”, I know I don’t need to pull out the Buyer Agency Agreement and the pen.
Gone are the days when a handshake = deal.
I read somewhere that the words “contract”, “signature” and the phrase “sign here” caused tremendous anxiety in people. This probably due to bankruptcy, divorce, and other situations that caused financial trauma.
Philleto,
I have to disagree, as “handshake deals” are done every day between buyers and buyer agents.
I will point out though, that it is not even POSSIBLE to have a handshake deal between buyers and sellers, due to the Statute of Frauds. Any agreement involving the EXCHANGE of real property, must be in writing.
When I see a buyer sweating over signing an offer to purchase, I pull the contract away until we talk about what concerns he may have that he hasn’t yet verbalized. Once he has a chance to get his questions answered, or he changes the offer to one he is more comfortable with, I bring the contract back for signature.
Once I tore it up after he signed it. That was a funny night. Almost as funny as the time my crossed legs were stuck together by the time we were finished signing, because I had my legs waxed just before the appointment. The client had to get me “unstuck” LOL. Fun memories.
Ardell,
Disagree! You, never!
Yes, that’s sarcasm coming from one Italian (ancestors are from Sicily and Rome) from the east coast (NY) to another.
Philleto,
These days, I find myself agreeing with clients more and more, and agents less and less š
P.S. I’m Abruzzuse and my escarole and meatball soup recipe goes to my daughters only š
Here in Texas, if I dont sign a buyer agreement, I work for the seller as a subagent in the eyes of the law, and that means I can’t advise the buyer on how to get a lower price. If somethin goes wrong and I’m sued by the buyer or the seller, and they find out I have no contract and have been helping the buyer negotiate, then I’m toast, and so is my broker.
I always explain to my buyers that they’re better off shopping around and finding a good agent and sticking to them through a buyer rep agreement. This way I’m confident I won’t get screwed because they use me to look at homes and then have their lazy relative with a real estate license get the commission.
I honestly don’t understand why so many agents talk about “getting screwed” by their clients?
How is it I’ve been in this business 16 years and haven’t had that problem?