Buyer Representation Agreement
When selling a home, most people know they sign a Listing Agreement with a realtor. There is, however, an agreement that realtors ask their buyer clients to sign when they decide to buy a home or cottage.
The first step is finding a realtor who knows the area well to help you with the search. Your careful selection of a professional real estate agent to represent your interests plays an important role in helping you purchase the right property at the right price. A skilled sales representative will add tremendous value to the buyer during the property search, drafting the offer contract, offer negotiations and overseeing the contract to completion. Once you have narrowed down the area you wish to be in and started your search, we will ask you to review and sign a Buyer Representation Agreement (BRA).
It sounds intimidating, but the contract is ultimately in the best interests of both the buyer and the real estate agent. A Buyer Representation Agreement is a legally binding document establishing a formal working relationship between a buyer and the buyer’s representative. The contract comprehensively details in writing the services the realtor provides, as well as any expectations the agent may have of the buyer in return.
Without a BRA, you are merely a customer. This means that a realtor is obligated to treat you with honesty and integrity but, beyond that, has a limited duty of care. This would be the case when you call an agent to have an informal chat about a listing. When you sign the BRA, you become a client, which is a different relationship than a customer. As a client, a realtor is bound to protect your interests, obey your instructions regarding finding a property, respect your confidentiality, and negotiate according to your best interests.
The positives of signing a BRA
- The real estate brokerage and agent act for you. They exclusively represent your interests and keep your information and motivation confidential from the seller.
- The agent may share information about the property history, comment on the home’s value, and provide comparable sales data when considering an offer.
- It provides clarity by outlining in writing what is expected by both parties.
I don’t want to sign a BRA. What happens? If you don’t want to sign a BRA? If you do not want to sign a BRA and avoid being a client but still require the assistance of an agent for drafting paperwork, you can sign a Customer Service Agreement. This is a non-exclusive agreement, where the buyer acknowledges that the agent is not representing their interests. If the brokerage represents the seller in the transaction, the Customer Service Agreement confirms that the Buyer understands that the brokerage is protecting and promoting the interests of the Seller and not the Buyer.