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Agency Information Few issues are more critical to a real estate transaction than are questions and issues raised by the complicated nature of AGENCY RELATIONSHIPS. Who represents who? What are the responsibilities of a Listing Agent, a subagent and a Buyer's Agent? Who looks out for you??!!
For a primer on these issues, click this link to view the Information About Brokerage Services form from the Texas Association of Realtors (you will need Adobe Reader to view this form). http://texasrealtors.com/web/63/pdf-forms/2501.pdf
For your convenience, I have also prepared the following to help you decipher some of the more complicated issues.
WHY YOU NEED A BUYER’S AGENT
To quote the previously proffered Information About Brokerage Services, “A broker who acts as a subagent represents the owner (i.e. seller) in cooperation with the listing broker”. Simply put, I am a subagent of the seller if I do not have a signed agency agreement with you. You will see the importance of this illustrated below.
Increasingly, sellers and listing agents are refusing to allow other agents to work in a sub agency capacity for a seller. They do this simply by refusing to pay a commission to an agent working with a buyer not committed to Buyer’s Agency via the Residential Buyer/Tenant Representation Agreement (TAR-1501).
Brokerage company policies and, increasingly, E&O insurers are encouraging agents and potential buyers to avoid the pitfalls inherent in a situation where the perception is that the agent is protecting the buyer when, in fact, their actual duties and responsibilities are owed directly to the seller!
For obvious reasons, buyer representation has become my preferred agency relationship when working with a buyer.
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BUYER’S AGENT |
SUBAGENT |
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Gives full attention to the buyer’s needs |
Pay attention to seller needs |
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Buyer can be open about their needs |
Confidential info must be shared with the seller |
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Suggests alternatives to meet buyers needs |
Agent keeps the focus on seller’s property |
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Find the best property for the buyer |
Find the best buyer for the seller |
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Investigate all property for the buyer |
Limit properties when you find one that works |
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Tell buyer about new listings |
No duty to keep looking for more property |
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No limit to price range of searches |
Show only properties that match price range |
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Give advice and interpret facts |
Only give the facts with no advice |
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Educate the buyer |
Protect the seller’s interest |
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Negotiation strategy for the buyer |
Only give facts and do not focus on negatives |
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Strengthen buyer’s negotiating position |
Strengthen seller’s negotiation position |
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Price-do a CMA and interpret it |
Comps only or a CMA that supports a seller’s price |
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Write in protections for buyer |
Do not suggest buyer protection if it hurts seller |
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Financing that is in the buyer’s best interest |
No financing suggestions that could hurt the seller |
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Negotiate to get the best for buyer |
Negotiate to get the best for seller |
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Share all info about the seller |
Share all info about the buyer |
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Solve problems for the buyer |
Solve problems for the seller |
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