BUYER AGENCY…WHAT IS IT???

NITTY GRITTY ON BUYER AGENCY.

A choice everyone who deals with a Real Estate Agent in Georgia must make is whether to be treated as a customer or a client by the Agent. If you choose to be a customer, they will show you homes and assist with the paperwork. If you choose to be a client, you will sign a contract that binds you and the agent. It binds you to work with only one agent in your search for a home, and assures they will be paid for their efforts. It binds the agent to work solely on your behalf, to assist in securing financing, to assist with inspections, to get the best price and terms possible, and in general look out for your best interest all along the way.

WHY SHOULD I CONTRACT TO BE REPRESENTED?

You would not go to court and face a judge and jury without an attorney would you? While most people feel they are competent to represent themselves in the purchase of a property, the truth is, most are not. This is perhaps the largest purchase most people will ever make, and it is very complicated. The mistakes you can make in working on your own could be very costly. The ability of a professional can save you many dollars as well as future problems. Remember, if you choose to be a customer, the agent is covered under the contract with the seller, and must act accordingly. They cannot assist in getting you a lower price, or better terms, give you info to help your bargaining position or anything that will harm the seller. The agent only owes you honesty in the transaction. They cannot withhold known defects or anything that materially affects the property. Other than this they owe you nothing! Do you really want to work with someone who is under contract to the seller? And looking out for their best interest? I don’t think so. You want the agent to work for you.

WHAT WILL IT COST ME TO BE REPRESENTED?

It absolutely does not have to cost you one red cent! You are obligated by the contract to be sure the agent is paid a commission, but you are also in control and never have to pay anything. You can require the agent to show you only properties with the seller paying the commission due (all listed properties fit this requirement). If you want to see a property where the seller does not expect to pay a commission, you can have the agent approach the seller to see if they will indeed pay the commission. You will never unknowingly be put into a position of having to pay a commission. Remember, your agent is under contract to you and must act on your behalf.

ARE THERE ANY DRAWBACKS TO BUYER AGENCY?

The possibility exist of what is called “Dual Agency”. This would exist when your agent shows you homes either he or his broker has listed. This puts the agent and his broker in the position of being under contract to both the buyer and the seller. While this is allowable under the law as long as both parties (buyer and seller) are aware of the conflict, it, in reality, serves the interest of neither party. In this case the broker will assign another agent to represent one of the parties so both are treated fairly. Also you are binding yourself to a single broker for a period of time. You can ask the broker to assign another agent if you are not comfortable with the first one. You are agreeing not to deal with any other brokers, owners, etc. while the contract is in effect. This prevents you from working on your own, but frees the agent to work solely for you and give you the time needed to make the right choices, knowing they will be paid for their efforts. Now the agent can spend the time needed to get you the home you want.

WHY HAVE I NOT HEARD MORE ABOUT BUYER AGENCY?

While it is not new, the truth is many agents prefer having you as a customer, not a client. If they bargain for the best price for you, they are, in essence, cutting their own pay, since it is a percent of the sale price. They also feel bound by the seller, who has already signed a contract with them or some other agent and guarantees them payment for their services. Many also don’t want to be put in the possible position of being a “Dual Agent”. Many agents go over this choice briefly, if at all, and have you sign off rejecting agency. Besides, it is difficult to convince many people it is in their best interest to sign a contract.

I FEEL “BUYER AGENCY” IS THE ONLY WAY TO PURCHASE A HOME!