I often read Mark Weisleder’s posts on the Moneyville website. This one in particular caught my attention: a realtor claimed an $11,000.00 commission from a couple after they signed a buyer agency agreement with him and then subsequently purchased a home through a builder.
Buyer agency agreements exist to protect realtors from doing work without getting paid. Essentially, they are agreements that require potential buyers to use the services of a particular realtor for a set period of time. This is perfectly reasonable, and even fair, as a realtor who has spent hours and weeks showing you homes should be entitled to get paid at the end of the day. The problem is when buyers don’t know what they are signing and aren’t therefore able to limit certain aspects of the agreement. For example, as Mark notes, you could make the agreement for a shorter period of time (say, one month instead of six), or make it only valid for resale homes so that you can buy a new home if you happen to stumble across one.
If you are planning to hire a realtor to help you buy a home – which is generally a good idea – just be sure you know what you are signing.
