Working With Buyers... Get it in Writing
CATEGORY: Standard Forms
TAGS: Buyer Agency Acknowledgment Buyers Agency Exclusive Contract Client Engagement Contracts REALTORS®
When a REALTOR® agrees to work with clients, it is prudent to have the nature of the relationship agreed to in writing. This will help to ensure that all parties know what they can expect from each other and what is expected from them.
When working with sellers, a mutually agreeable exclusive contractual relationship is generally negotiated and documented using a listing contract. When working with buyers, REALTORS® should use a Buyer’s Agency Exclusive Contract form when both parties wish to enter into a contractual relationship and agree to work together exclusively. As with a listing contract, this will provide details of the services to be provided and confirm the amount of remuneration payable, when it is earned, and when it becomes payable.
It makes good business sense for REALTORS® to invest their time, energy, and expertise with buyers who are prepared to have a mutually beneficial and exclusive working relationship in the form of a contract. This is commonplace when working with sellers and should also be so with buyers.
REALTORS® are trusted advisors who bring great value to their clients, and it makes sense for both parties to have the protection afforded by a written agreement. Working with buyers without a contract makes it possible to invest valuable time and provide excellent service only to have them buy a property with another REALTOR®. This situation can be avoided by entering into a written contractual relationship.
When a REALTOR® agrees to work with a buyer without a contract, it is strongly recommended that a REALTOR® uses a Buyer Agency Acknowledgment. This form provides the buyer with important information about the level of services that will be provided and contains several important acknowledgements from the buyer regarding the details of the non-exclusive working relationship. These acknowledgments also provide several legal protections to the REALTOR® when working in this situation.
Working with buyers with no documentation other than the Disclosure of Representation in Trading Services form may place REALTORS® in a difficult situation or expose them to risk. A buyer may challenge some aspects of services not provided which were not agreed to by the REALTOR®. Additionally, there is no protection from claims that the buyer did not know that the REALTOR® would be working with other competing buyers and showing them the same properties. These and several other valuable protections are provided for in both the Buyer’s Agency Exclusive Contract and the Buyer Agency Acknowledgment.
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