In the past, when you are buying a house and you hire an agent, this real estate professional usually represent the seller – to the disadvantage of the buyer. You are revealing personal information to your agent regarding your situation and finances but your agent relays this to the listing agent of the home you are making an offer on.
Here is a very typical example of a buyer losing thousands of dollars because he or she disclosed how much he or she is willing to go. You are looking for your prospective house and you found in one listing a unit that you fell in love with. You call the agent, you view the home and you are ready for your offer. You discuss with your agent your initial offer but at the same time you give him the information that you are willing to go to a certain higher amount. When the listing agent relays your offer to the seller, he can inform the seller on your higher price. Thus, your seller counters your offer to a higher price, close to what you are willing to pay. Would you not be losing a big amount in the revelation?
It was in the light of situations like this that the Buyer Broker Exclusive Employment Agreement was conceptualized. In the past, entering into a real estate transaction entails protection of the seller – and the seller alone. All of the registered real estate agents and brokers represent the builder or seller – never the buyer. There were no restrictions on information disclosures so it was apparent that whatever a buyer discussed with the agent will absolutely be relayed to the seller.
Laws and regulations on real estate had changed in the past few years. This was done to protect not only the sellers but the buyers as well, whomever is represented by the agent. This paved way to the Buyer-Broker Exclusive Employment Agreement.
Today, the real estate professionals who get engaged in the buy and sell of properties utilize a form which is called “agency disclosure”. This form should be accomplished by the buyer before he makes an offer for the property. This in effect guarantees the buyer that the agent will work for the buyer’s best interest. With this, the agent’s fiduciary duty shifts from the seller to the buyer.
This Buyer-Broker Exclusive Employment Agreement is not yet a standard practice although it has been in existence for almost 20 years. This agreement is between the buyer and the real estate agent which stipulates the responsibilities and fiduciary duties of both parties – the buyer and the agent. You as the buyer now are assured that your agent is representing you exclusively. Furthermore, it allows for secrecy of buyer’s price disclosure. This agreement does not bind the buyer to really purchase a house, it merely ensures the loyalty between the buyer and the seller. This is a protection for any prospective home buyer.
Buying a house is really a complex venture. Thus buyers would have a better chance of finding the right property if they engage the services of an exclusive buyer agent, who in turn will respect the provisions of the Employer-Broker Exclusive Employment Agreement.
Rob Lamb Long Realty Team is your number one source for Tucson real estate, Tucson realty, homes Tucson, homes for sale Tucson and more. Voted TUCSON’S #1 REAL ESTATE AGENT 2008! http://roblamb.com
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