Why Use a Buyer's Agent?

By Deniece Watkins, Realtor, ePro

Buyers benefits greatly by having their own Realtor in a transaction. There are two main reasons why: A Listing agent owes a duty to the "Seller only". A Buyer's agent is free. However, as you will see below, it is not as simple as it sounds.

Real estate forms are infamous for their ambiguity. The confusing wording put in a form as simple as the Agency Disclosure can send anyone for a spin. Without knowing better, Buyers may give up their one way to their own representation.

An agency disclosure is signed by all clients and Realtors who have established a relationship. It is a state mandated law that it be signed. You will find quotes that are directly from the form below. They are not clear. The wording is very tricky.

The agency disclosure, under “Seller’s Agent”, states exactly this:
"A seller's agent under a listing agreement with the Seller acts as the agent for the Seller only."

Under the section called "Buyers Agent", the verbiage reads like this:
"A selling agent can, with a Buyer's consent, agree to act as agent for the Buyer only. In these situations, the agent is not the Seller's agent, even if by agreement the agent may receive compensation for services rendered, either in full or in part from the Seller."

A “selling agent” means Buyers agent, “listing agent” is the agent for the seller. For those more math minded:

Listing agent represents a Seller.
Selling agent represents a Buyer.

When an individual Buyer’s agent is hired, they do not have a special duty to “the Seller only”, as per the Agency Disclosure. As you read below, you will find that an agent that represents both sides of a transaction is still obligated to “the Seller only,” although the wording is very confusing.

The section "Agent Representing Both Seller and Buyer" states:

"A real estate agent, either acting directly or through one or more associate licensees, can legally be the agent of both the Seller and the Buyer in a transaction, but only with the knowledge and consent of both the Seller and Buyer."

This section goes on to explain that, "In a dual agency situation, the agent has the following affirmative obligations to both the Seller and the Buyer: '…Other duties to the Seller and the Buyer as stated above in their respective sections.'"

Therefore, as stated in the Agency Disclosure, the only way to have a Buyers' agent who works on behalf of a Buyer at all is to use an independent Buyer's agent who does not have a written allegiance to the “Seller only”.

The Buyers' agent, who is not representing the Seller also, can look diligently into the information and reports to find out what might adversely affect an owner of a property, and even delve deeper into the subject with the Buyer to understand the extent of the condition. It is not in the Listing agent's role to pay such attention to a negative matter that can affect the Buyer, since it is not representing the Seller’s best interest.

As stated above, another reason to hire a Buyer's agent, is that the Seller has already negotiated terms of commissions with the Listing agent. When a Seller meets with an agent and agrees to have representation on the sale of a home, the Seller agrees then what they will pay both the Listing agent and the Selling (Buyers) agent. You get your representation as a Buyer for free!

To understand all of the forms required for your sale or purchase, please give me acall. We can discuss what they really mean to you, then make sure that your interest is represented when you sell or buy your home.