What is a buyer's broker?

This is an Agent that works for (represents) the Buyer Client, solely and has Fiduciary duties to the buyer (client), as follows:

1. Undivided loyalty - Put the buyer (client's) interest first. The obligation to act solely in the best interest of the client.

2. Obedience - Not to exceed the scope of authority conferred by the buyer (client) and to follow all lawful instruction.

3. Reasonable care and diligence - To protect the buyer (client) from foreseeable risks of harm and recommend that buyer (client) obtain expert advice on needs outside the scope of agent's expertise.

4. Confidentiality - Personal information about the buyer (client) shared by the client with, or obtained by the, agent must be kept confidential unless the client releases the agent from this duty.

5. Full Disclosure - Disclose affirmatively all information concerning the transaction that might affect buyer (client's) best interest.

6. Accounting - Promptly report to the principal (client) all money and property received and paid out. To safeguard any and all money or property held on behalf of the principal (client).

These are the same Fiduciary duties that a Seller enjoys with the agent that markets a property, and represents the seller's interest in a transaction.

Who pays the brokerage fees?

The brokerage fees to agents may be paid by anyone as long as the following three conditions exist:

1. All parties know and understand who is representing whom in the real estate transaction.
2. All agents speak and act in a way that is consistent with their agency relationship.
3. All parties know, understand and agree as to how the brokerage fee will be paid.

If a chosen property is being marketed through a Multiple Listing Service, the Listing Broker has a separate agreement with the owner of the property regarding brokerage fees. The agreement to share this fee with other members of the Multiple Listing Service is published on the listing information sheet.

There are other scenarios and ways of compensation, such as For Sale By Owner and properties represented by Brokers that do not belong to a Multiple Listing Service. You should discuss this with the agent that represents you.

Should I use a Buyer's Broker for a New Construction home?

This should be no different than any other purchase! Buyers need representation with new homes as well as pre-owned homes.

A New Home Builder has agents on the sales site to assist the buyer and answer questions about the builder and the product being offered. These agents solely represent the Builder.

Rarely does a builder reduce the price of a new home because the buyer comes in unaccompanied by a Real Estate Agent that is representing them. It is generally thought to be in the buyer's best interest to have their own representation in these transactions. The builder usually promotes, solicits and maintains a good report with local Real Estate Agents.

How to choose a Buyer Broker?

There are a number of ways to find a good Broker to represent the buyer's interests. Ads, signs, and mailings are some ways that brokers attract the attention of potential clients. However, often it is someone you meet in the course of your daily routine or possibly a person referred by a friend or trusted family member that becomes your buyer Broker.

You are the employer. Ask about credentials:

1. How many years of real estate experience do they have? Full time or part time?
2. What kind of license is held? Is the agent a Licensed Broker or a Licensed Sales Agent?
3. Some of the designations held by further education in the Real Estate business are:
ABR - Accredited Buyer Representative
CRS - Certified Residential Specialist
GRI - Graduate of the Real Estate Institute
4. Does the agent participate on a local or state level with issues affecting home ownership?
5. Does the agent have recommendations from past clients?
6. Talk to your agent about real estate ethics.

Q: What is a Buyer-Broker Exclusive Employment Agreement?

This is the agreement between the Buyer and the Broker that gives the terms and conditions under which the Broker representing the Buyer will receive a fee for their services. This is the counterpart to the Exclusive Listing Agreement that a homeowner enters into when hiring a Real Estate Agent to represent the sale of the home.