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I am totally new to the home buying process. I looked online at some houses that I liked, and the realtors who I was put in contact with told me to come and take a look. After I got off the phone with these guys, I realized that each of them were not the listing agents, meaning they were not the seller's agents. They were "Primer Agents" that websites like Zillow and Trullia forward your contact info to when you express interest on a home listed on those sites.

So my question is, at this stage of my home buying journey, can I work with multiple of these "buyer" agents? If all they are doing is showing me houses.

At what point would I need to pick one of them and sign with them that they will be my agent?

  • I have the impression that the concept of buyer's agent varies by state. Please post which state(s) you want to buy in. For example, my buyer's agent told me that in Delaware, as soon as a selling agent shows you the property, for example at an open house, you are on the hook to them as your buyer's agent, for that property. I think he asked me not to go to open houses, as he would be cut out of the deal. – Qsigma Jun 7 '17 at 9:24
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Typically when you put in your first offer you'll sign an exclusivity agreement with the preparing agent that requires you to use them for a set length of time.

Showings are kind of like an interview process for many realtors, if you like them you can stick with them, if not, feel free to date around. Some agents may push an exclusivity agreement earlier, but in my experience it's always been during the first offer where they've presented that. The realtors that get connected via sites like Zillow can be great, but it can pay off to find an experienced agent in your area rather than take what they provide.

Edit: The language in these agreements can vary, they're mostly just to protect against you finding a lower fee or going sans-agent once an offer is in place, but some may try to prevent you from parting ways with your agent between offers too, so mind the language they use and the length of time, don't want to be stuck with a bad agent.

  • Most of the time they'll include a <some hundreds of dollars> fee - it's basically there so you don't waste their time as a realtor. – Wayne Werner Jun 5 '17 at 21:28
  • What? In the US, a purchaser signs a contract with the vendor's realtor? That's wierd. In Baden-Württemberg (in Germany), a purchaser is on the hook to pay half the Markler's fee -but that only happens when you actually complete the contract (and the Notaire forwards the money). In the UK the realtor is called "an estate agent", and they are very much the agent of the vendor. – Martin Bonner Jun 6 '17 at 15:24
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    @MartinBonner No there are typically 2 agents involved, one for buyer and one for seller, but as a buyer you typically don't commit to an agent until you put in an offer on a property (the agent who prepared your offer). Typically in the US the fees for both agents get paid from the seller's proceeds. – Hart CO Jun 6 '17 at 15:32
  • Interesting. There are "property search agents" in the UK who will find you a house, but they are unusual (eg relocating to UK from abroad), and you definitely commit to one before they start looking for you. – Martin Bonner Jun 7 '17 at 9:20
8

By default, all real estate agents are seller's agents. Even if you, as a buyer, are working with a real estate agent, and he/she shows you a house that is listed with another agent, if you don't have a buyer's agent agreement in place with your agent, then your agent is legally representing the seller's interests, not yours.* This means you should not expect any help or insight from your agent in negotiating the best price or in writing an offer that protects your interests as a buyer.

However, if you sign an agreement with your agent to be your buyer's agent, he or she can then represent your interests, not the seller's.

In my opinion, it can be beneficial to sign with a buyer's agent early in the process, so that they can offer their honest advice without fear of a conflict of interest with the seller. However, you want to make sure that your agreement gives you the right to fire your agent if you aren't satisfied with the service that they are giving you.


* This absolute statement is true in many, but not all states. In some states, the agent can default to a buyer's agent under certain circumstances. However, to ensure that your agent is working with your interests in mind, a buyer's agent agreement requires the agent to represent your interests above the seller.

Three articles for more information:

  • 1
    I'm curious where the notion that they default to seller's agents comes from. Every agent I've worked with has clearly been working as my agent before I signed an agreement that would guarantee they get paid. It just sounds bizarre to claim that someone who has shown me a dozen houses is somehow more concerned with the interests of a dozen different sellers than mine as the buyer. – Hart CO Jun 5 '17 at 19:42
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    @Hartco The Seller wants the highest price he/she can get, and to actually complete the sale. A real estate agent wants the highest commission he/she can get, as fast as possible and with the minimum amount of work. Therefore, the best choice for the agent is to represent the seller, not the buyer. If the agent is representing the buyer, the buyer will pay the agent for that, one way or another! – alephzero Jun 5 '17 at 20:26
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    @alephzero That's my main gripe with buyer's agents getting paid commission, but most buyer's agents get paid on commission. I think it's a perverse incentive, but I don't think it means they are incapable of acting as buyer's agents. – Hart CO Jun 5 '17 at 20:31
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    @alephzero The original statement, "your agent is legally representing the seller's interests", is a much different statement than yours: "the best choice for the [uncommitted middle] agent is to represent the seller, not the buyer." I also want to know the answer to Hart CO's question. – Beanluc Jun 5 '17 at 22:23
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    I too, would like to know the answer to that question. How can a random real estate agent, one who has never met the seller before, be responsible for legally representing the seller's interests until you've signed an agreement? That's extremely different from pointing out that some of their incentives may be misaligned from yours. – Zach Lipton Jun 6 '17 at 1:59
3

From what I understand from Louisiana real estate law (I am by no means an attorney) it can vary from state to state, as far as who works for whom, but this sounds like incorrect information that an agent "automatically" reperesents a Seller. If you are not the listing agent, why would you protect and negotiate on behalf of the Seller? And if you're saying "higher commission", that is literally on not showing a $100,000 house, opposed to showing a $105,000 home down the street, collecting an extra $90 of commission (if the split is for instance is 6%, then giving your brokerage say a 40% cut). I don't feel like any agent would try to show a particular home to work "for the Seller" to collect an extra $90. This is not good business and would NOT help you continue to get an dkeep clients. Is this something from another state that I am unaware of? And as far as paying commission goes, the Seller in Louisiana pays the commission to both agents, but in my experience has absolutely nothing to do with working more towards protecting the Seller whatsoever, but our ethics and laws of agency protect against it on the contrary. It's our fiduciary duty to work for and protect whomever's best interest we are hired to work for. Look up "real estate agency law" for your state and that should clarify things for you, or consult your agent's brokerage. They should provide you with a pamphlet as well.

1

The two times I've looked for a house they've wanted me to sign stuff right away, and both times I told them that I would sign a contract only when it was in my best interest to do so. Both times I removed disadvantageous provisions like binding arbitration and lawyer's fees and they didn't complain about it. As far as I can tell the only real rule is that the local organizations require them to have some kind of exclusivity agreement in place before they're allowed to make an offer on your behalf.

0

The buyer agent only represents the buyer, they put the buyers financial interests before any seller, unless the buyer agent is the listing agent, at that point they don't represent anyone financially and become a dual agent.

Here in NJ we do not require a client to sign an exclusive agreement on the buyer side. If you like your buyer agent use them for all of the houses you need to see. They are your consultant and can find homes you can't, they also analyze the market and negotiate on your behalf. Going against into a deal without a buyer agent is a huge handicap.

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Buyer Agents...work for the Buyer. Seller agents are under contract with the seller to get them the best possible price and terms. OF course the Seller wants to sell you his listing, they make more money...they are under no obligation to show you a house on the next street over that is nicer and perhaps at a lower price. Many Seller agents do not even want to be bothered with Buyers unless your buying their listing...your to much work.

Agents that are asking for an exclusive contract are ensuring they get paid and can run you around all over gods country if need be. Without a contract many Buyers will simply jump to another agent. The buyer agent has just wasted all his time and work, they are paid by commission only...after a sale is completed.

It is in your best interests to pick a Buyer agent you like, set your expectations and if you agree with what they present put them to work and have them find you a property.

Cheers...get someone on your side.

0

Signing an exclusive buyer's representation agreement establishes you as a client. It ensures that your interests are aligned. If a buyer's agent is going to invest their time and gas money showing you properties, they deserve to be compensated. At any time after you have signed an agreement with a buyer's agent, either one of you can terminate that agreement. If you do so, that agent will only be owed a commission if you decide to purchase a property they showed you within the prescribed protection period. If you are working with a knowledgable agent, don't be surprised if they ask you to sign an agreement, so they can get to work for you.

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