A Buyer’s or Tenant’s Representation Agreement is an agreement that protects both the buyer and the real estate agent.  It assures that the Agent will represent the Buyer (or Tenant) as a Client during the purchase or lease of either residential or commercial real estate.  

1.      The Real Estate Agent has no fiduciary obligation to a Customer. 

2.      A Client will be represented to the fullest and has the protection of fiduciary obligation on the part of the agent and the brokerage.

3.      If the Broker is representing the Buyer and the Seller in the same transaction, if the Buyer is also a Client the agent’s obligation and fiduciary duty is to represent both equally.

4.     The Agent is more likely to spend the time and energy to fulfill the Client’s needs because he has the assurance of the Buyer’s seriousness, as well as the guarantee of receiving a commission, therefore the agent will generally place the Client in a position of top priority.

5.      Refusal on the customer’s part to sign a Buyer Representation Agreement sends a message to the agent that he or she may not be serious and may be shopping with several agents at the same time.

6.      A Client will be provided with a comprehensive understanding of the entire scope of services to which the Agent is obligated.  The Buyer will receive a copy of the Agreement and it will be explained thoroughly at the time of signing.

Misunderstandings about a Buyer Representation Agreement:
1.   Typically, there is no cost to the Buyer to have the Agreement; the Agent’s commission almost always comes from the Seller.
2.    The Agreement creates no obligation on the part of the Buyer to purchase or lease real estate yet it assures that  if they do, the Agent will be paid a commission on a sale or a lease.
3.    The Agreement can be customized with regard to length of time and type of real estate so the Buyer is not obligated to purchase everything through the agent he signs the agreement with.
4     There is equal and mutual protection to both parties with a Buyer Rep Agreement.  The Buyer can hold the Agent accountable for performing fiduciary services and the Agent has the assurance that he or she will receive a commission for services rendered. 
5.    While the Agreement is mutually binding, most Buyer Agents are willing to terminate the agreement in the event the relationship is not working out.  The Buyer, however in that case, is still obligated to pay a commission to the Agent on any properties that the Agent has shown the Buyer.
6.    On occasion, a buyer may mistakenly think that having several Agents working for them will get them a better deal when in fact, it is just the opposite. 

Real Estate Agents, like lawyers, sell knowledge and service.  The experience and familiarity with the real estate market are what make them qualified to represent a Client.  They assist clients on how to navigate through the myriad aspects of the real estate market.  Their skill and knowledge can help save the unsuspecting real estate Buyer thousands of dollars, months of grief and an endless stream of red tape.

If you decide to sign a Buyer’s or Tenant’s Representation Agreement with Silver Star Real Estate, there are several terms of the arrangement are vital for you to consider:

• Spend time with the agent:  Make sure you work well together and that you have faith in their commitment and dedication to meeting your needs before signing the agreement.
• The contract is mutually binding:  Both the agent & buyer are obligated to the terms within the contract.
• Length of Contract: How long will the Agreement last?  Start out short, you can always add more time.
• Exclusivity: What are the terms that apply to the transaction if you choose to purchase through another Agent.
  
• Termination: Some Agents and Buyers find that they do not work well together.  What is expected if either one of you decides to terminate the mutual agreement?  Usually, the Agent will be willing to terminate the agreement and will only required a commission if you lease or purchase a property which they have shown to you.
  

As the  real estate climate becomes more and more complex, as the challenges with commercial real estate become more difficult and demanding, it becomes increasingly important for a buyer to secure knowledgeable and experienced representation who are bound by full fiduciary duty to meet your needs. This, and more can be found with the Silver Star Real Estate team.