Tuesday, April 19, 2011

Don't Sign a Buyers Agency Agreement

I don't dispense medical advice. I do not give legal opinions. I don't give tax advice. I help you look at the housing selections that will best suit your family and your needs for tomorrow not just today. You don't go to court to fight a traffic ticket.

Imagine my surprise when I read this dribble. The balance of the article is materially correct. Do you have to sign? No, But I can show you why you want to. And If you want out. I am pleased to offer a Satisfaction Guarantee.

Roseman: Know your rights as a real estate buyer
April 17, 2011 22:04:00
Ellen Roseman
Personal Finance Columnist
There’s been a revolution in real estate in recent years. Unfortunately, many customers are still in the dark about it.
I’ve written two previous Moneyville columns about working exclusively with a real estate agent to buy property. One related to cottage-huntersand the other looked more generally at buyer agreements.
Because of all the feedback, I’m devoting this week’s column to answering frequently asked questions about a buyer’s relationship with a realtor.
Q: I was shocked to hear I had to sign a three-month exclusive contract with a real estate agent in order to submit an offer or even to look at property. This was supposed to cover the time and expenses in finding the right home. Do I have to sign?
A: No, you don’t have to sign an exclusive contract with a real estate agent when buying a home. It’s your choice.
The law requires buyers to sign a document, called Working with a Realtor, at the earliest practical opportunity. It’s better to have a conversation about it when you start looking at homes together, rather than in the hectic time before you submit an offer.
Having an exclusive contract, known as a buyer representation agreement (BRA), is just one of the ways you can work with a realtor. If you prefer not to sign, look for someone who won’t insist on exclusivity.
You can negotiate the contract terms, such as signing for a shorter period than three months (even a month or 10 days). You can limit the contract to a specific property, street or neighbourhood, if the agent agrees.
Q: What if I don’t sign? Will the agent still represent my interests?
A: If you sign a BRA, you’re a “client.” If you don’t, you’re a “customer.” The words seem interchangeable, but not in real estate.
Under a buyer representation agreement, the realtor has a duty to protect you (known as a fiduciary duty under the law). This means your interests come ahead of the seller’s interests.
Once you submit an offer on a property, anything you tell your realtor about your final price can’t be shared with the listing agent.
If you don’t sign a BRA, you’ll sign a buyer customer service agreement acknowledging that the brokerage “will not be representing the interests of the buyer in a transaction.”
There’s a chance your real estate agent may give confidential information to the seller’s agent — or may give you incomplete information on the property and the commission payable.
“You can decide to be a customer, rather than a client, but should be aware that the obligations of the brokerage will differ,” says the Real Estate Council of Ontario, the arm’s length body that regulates the industry.
Q: What if I sign a BRA and want to leave because I’m getting poor service from my real estate agent?
A: You’re better off waiting until the BRA expires. Otherwise, you could end up in a legal fight.
If you buy a home while still under contract, your original agent is entitled to the commission paid by the seller. You could get sued by the second agent.
The BRA says the agent will represent the buyer in a real estate transaction “from any source whatsoever,” says Ken Wilder, a former agent who now coaches others on buyer representation.
But the BRA can be altered, he emphasizes — unlike the MLS agreement that property sellers must sign.
You can add provisions to the contract to exclude certain scenarios, such as a private sale or an auction.
Q: What if I want to cancel the contract before it expires? Can I do that?
A: The contract is with the broker. So, you can call the broker and say the agent has not lived up to your expectations. Therefore, you want to cancel.
The broker may suggest you work with another agent at the firm until the contract ends. That’s an option to consider.
But if you don’t want to stick around, you can play a bit of hardball.
Tell the broker that your agent didn’t explain buyer representation properly to you and didn’t perform the promised duties, to your detriment. Now you want to take the issue up with RECO.
“This will generally soften their position. Most brokers are aware that the BRA is rarely explained properly and don’t want the regulator looking over their shoulder,” Wilder says.
Ellen Roseman writes about personal finance and consumer issues. You can reach her at eroseman@thestar.ca.

Yes, Correct
You have the right not to sign a BRA. Why does it need to be for 3 months? Not really 30 days is fine. One day is just as good, each time we go out. I have the right to show my client's houses. I am not in the house showing facilitation business. I have the choice to show my clients houses first, those under Buyers Agency, then to you as a Buying Prospect. If the Listing is mine, then there is a past and current relationship with that Seller that predates you're ever arriving on the scene. Why would you presume that I owe you anything?

DO you think that $100 per house per showing is a better plan?  

Go to three dentists for the same job, Have a mechanic start the job and another finish it. Why not have your taxes done by two different firms.

This article proves to me that "Just because you read it online" does not make you an expert.

What do you think?

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