I am very passionate about buyer agency.
To give you just a short history of how buyer agency came about, many years ago when sellers listed their homes, they hired their Realtor to list and represent their best interests but the buyers didn't have anyone to represent their best interests.
In 1988 this changed when buyer agency was created. Today, a buyer has the same opportunity to hire a Realtor to represent their interests as sellers and it levels the playing ground.
A buyer can hire a buyer agent by simply signing what is called a Buyer Broker Agreement. All of the buyer terms are explained within the agreement which includes how the buyer agent will be paid and by whom. Typically when a seller lists their home they have already decided how much they will be paying their Realtor and the buyer agent. So, the buyer agent typically gets paid out of the fee the seller agreed to pay when they listed their home. On rare occassions, the buyer agent COULD be paid by the buyer if the home is a For Sale By Owner and the owner refuses to pay your buyer agent. No matter what, before you sign the Buyer Broker Agreement all of that will be decided by the buyer and agent.
I recently wrote a blog on buyer agency. Feel free to read it at http://www.reneeporsia.com
With all of the benefits that come along with buyer agency why wouldn't any buyer want representation?
I hope this helps or at least gives you more insight into buyer agency but PLEASE feel free to contact me with anymore questions you may have.
One more thing, there are many Realtors who do not themselves understand fully what buyer agency is or what their role is as well as what a consumer is if the buyer refuses to sign a Buyer Broker Agreement. If a buyer does not sign or hire a buyer agent, the agent's loyalties are to the seller NOT the buyer. For more information check out http://www.rebac.net (different states may have different rules)
RE/MAX ACTION REALTY
(215) 669-0589 Direct
(215) 358-1100 Office ask for Renee
Buyer agency grew out of the need for buyers to have equal representation in real estate transactions. Previously agents only worked in the best interest of the seller. A seller's agent negotiates for their client, holds their information in confidence, and so on. Buyers need the same professional services
Usually the commission paid to a buyers agent is paid for by the seller, but buyers can elect to pay their agent for their services as well.
You are MUCH SAFER having your OWN REPRESENTATION - someone who will fight for you and protect you as well in the transaction.
When I meet people, like Asher, who know everything I find it easier to just smile and nod as I recall these words by Robert Frost:
"You are educated when you have the ability to listen to almost anything without losing your temper or self-confidence."
In NY State, you cannot "simply take a course from some fly by night company and an exam to get (your) license" as stated by Asher.
Requirements dictated by the Dept. Of State require a real estate course to be approved and regulated by the Dept. of State, with minimum hours to be spent on different aspects of real estate including, but not limited to Fair Housing laws, Ethics, Real estate law and many other topics very important to the process.
The exam is administered again, by the Department of State. There are also minimum requirements for continuing education every 2 years, with new fair housing and ethics classes to be included in these minimums. This is a very heavily regulated and monitored industry, as opposed to what he is asking you to believe.
Regulations DO vary state by state, but a licensed salesperson or broker may only practice in the state in which they are licensed.
As for using a real estate attorney for your whole transaction, the number of problems with that course of action is too large to discuss in detail, just beginning with the fact that they do not know the market in a given area and cannot properly advise you on pricing, inspections needed, etc. They know law. Black and white. They do not eat/breathe the market, following trends and checking hotsheets on an hourly basis.
What an attorney is doing by refunding you the commission is essentially a "kickback", which is illegal in NYS. They may be able to work it another way to circumnavigate the law, but that is much more unethical than honoring a listing fee as stated in a listing contract.
Daniel, just to clarify:
I am not meaning to nitpick here, but I want to be sure a buyer is not mislead regarding dual agency when dealing with a seller's agent. It is not always in the capacity of a dual agent. If that IS the case, the agent then becomes basically a conduit for information, passing info from one party to the other, and helping them get through the process smoothly. A dual agent must not harm EITHER party's negotiating position, treating both fairly.
On the other hand, a buyer may be dealing with a seller's agent who is just that.. a seller's agent, who has only fiduciary responsibilities to the seller. In a case like this, if a buyer says to them "I would happily pay $150K for this house but only want to offer $140K.", the agent then has a responsibility to tell that to the seller, thus harming the buyers negotiating position.
There is a big difference between dual agency and seller agency that buyers should be knowledgeable about.
I don't mind telling you what points are untrue that you posted within this thread. You state: "The fact of the matter is, real estate agents have no educational requirements. " FACT: Asher is that like any profession, Realtors are required to take MANY courses as well as CONTINUING EDUCUATION courses to keep their license current as well as ETHICS courses.
Then you state: "The listing agent has offered a buyer's agent half of their commissions to bring a buyer. If no buyer's agent exists, 3% of the sales price (the typical buyer's agent commission) is on the table for you to negotiate off the sale price of the house." FACT: Asher is that it's not the listing agent who offers anyone anything. It's the seller who sets the fee for service to both their agent as well as a "buyer's" agent. If no buyer agent existed the fee for service that the seller agreed to pay his/her agent is NOT negotiable to a buyer. Again, the seller is paying their agent to WORK for them to protect their best interests and get their home sold. They are not paying the buyer anything.
It seems to me that you like to lump all Realtors into one big ball of stupid and I find that to be quite offensive and rude. I consider myself to be extremely educated, smart, ethical, honest, loyal and wise to.
Were you able to take a look at the REBAC site yet?
RE/MAX ACTION REALTY
(215) 669-0589 Direct
(215) 358-1100 Office
I just had to make a comment to you and to any other "non" Realtor who likes to answer questions that are asked of real estate "professionals." Before you make anymore comments that are untrue, you should really visit the REBAC website. Then you can come back and comment. http://www.rebac.net is the website that explains what exactly buyer agency is and means to both a buyer and a Realtor.
You obviously had a bad experience with a Realtor at some point in your life or something else happened because you are quite hostile towards Realtors in general. Not all Realtors are unethical and I'd like to believe that all are not but there are always a few bad apples in the bunch. That is to be found in every profession. It seems to me that you like to come on Trulia and bash Realtors calling us trolls who are just looking for clients. Please do not lump all Realtors into your issues you have with Realtors. I myself work very hard to answer questions for consumers and I am very ethical and honest with all of my clients.
Take two seconds of your day and go to the REBAC website and read about it. There is a difference between being just a "customer" and being a "client."
RE/MAX ACTION REALTY
(215) 669-0589 Direct
I do not have to answer to you. Everything that you say is absolutely insane. You happen to think that you are the center of every Realtor's world when in fact, you are not.
You need to back off and stop calling me a liar and making false statements about my professional reputation. If you keep on making those false statments about me on this public board, I will contact my attorney as well as Trulia and take whatever action I have to against you for slandering me.
I just had to laugh when I read Asher's ridiculous statement "We made sure she would not make more than her share of the commission and may even have to refund some money to the seller to bring this transaction to a close."
Once again in response to Asher Smith,If you look at my post you will see that I have quoted NY State Law (and here is a link: http://www.dos.state.ny.us/lcns/lawbooks/re-law.html ) I am not lying and have no reason to lie! What I've said is based on my previous experience as both a consumer/buyer and as an agent and broker! The agent and/orbroker who is licensed under a broker(brokerage) has no absolutely no authority to adjust their commission, as the listing belongs to the brokerage company! If you read my post again you will see what I am talking about and that I am saying that it's much more likely that a buyer- broker will be able to reduce the buyer side commission if allowed by the main broker and (by the law in their state) A small company such as my own is in a better position to make the deal go through if necessary and I have myself taken less commission, in the past in Arizona as the buyer-agent so that the the buyer was able to get the home he wanted but the seller agent did not help at all, as a matter of fact they never presented the offer! I myself have gripes with the way some agents, do business such as not presenting all offers or advertising or posting on the web & the mls expired or sold listings or mis-leading listings and am constantly reporting such to Trulia and elsewhere..Please look to yourself before you call someone a liar! (What you describe using an attorney as your broker and having them give you back the commission does not sound like it would be allowed in New York and since most lawyers charge $200 an hour and up for even phone calls, it sounds like it could wind up costing you more! Maybe things are different in Califonia?)
Happy Thanksgiving all!
To clarify: I have read that many below have described the buyer's agent as receiving a commission from the listing agent for "bringing a buyer". It's much more than that, just ask one of my "buyer" clients. The job starts well before finding the right home for a buyer and it does NOT end once they purchase that house. All of my "buyer" clients have stated that my commission was well deserved or that I was under paid.
If you want more information, please call or email me. With our best wishes to you and your family.
Harrison K. Long, Realtor agent and broker, Coldwell Banker Previews, Irvine, CA
For the best seller property search web site check out
I am disappointed that another commenter has presented you with such negative and misinformation about Realtor agents and their qualifications. Most Realtors that I know and work with are highly professional and have significant education and experience. In additioan to being a Realtor and broker, I am also a lawyer licensed by the California State Bar for more than thirty years.
All Realtors are members of the National Association of Realtors and subscribe to the Code of Ethics for Realtors. We are very careful about this and challeng each other to know more about obligations of Realtors in terms of education and how to treat others and clients.
When we represent a buyer and get involved in a transaction, we work with the every day ... and sometimes morning, noon and night ... on a personal basis until the contract is fulfilled and escrow is closed. We are dedicated to success for the benefit of our clients, and it shows with good results.
Real estate is much more than find a listing and sending it to the client. Call us or email us at HKLong@cox.net, and I will provide a lengthy outline of exactly what we do for our clients. Being truthful and careful to protect the interest of our clients is our highest priority.
Harrison K. Long, Realtor agent and broker, Coldwell Banker Previews
For The Best Home and Property Search site check out
You have started a very passionate discussion. I would strongly recommend reading Renee's posts.
Basically, a buyers agent is your quarterback. Do you want a rookie or a Brett Favre to navigate you down the field to score ? Or another analogy - when you have surgery done do you want the experienced doctor or the one in med school. Or if you are getting divorced, when you want your husbands attorney to represent you ?
The states added buyer agency for a reason - it benefits the consumer.
So in Pennsylvania, you can have your own agent as a buyer, have the listing agent but a dual agent or do it on your own. The point being why would you when the seller pays the real estate commission ? Also, would one perform surgery on themself ?
Hope that helps : )
Bottom line, when you purchase a property, get a strong buyers agent !!!! : ) That way, you will have your own representation... your own quarterback, your own doctor... I think you get the point !
RE/MAX ACTION REALTY
(215) 669-0589 Direct
(215) 358-1100 Office Ask for Renee
As for the benefit of having your own agent... everybody said everything perfectly. So, here's all I can add:
I feel guilty when a buyer buys from me directly and doesn't have an agent. Only my clients really know how much of a benefit they're getting. I can only show comps that support the price - not ones that don't. I can't tell you things that you maybe should know (except where the law requires disclosure). Anything you say can and will be held against you in the art of negotiation, without reading your miranda rights. I am skilled at not knowing that you have given away something that will be to our benefit. I know it sounds mean, but I am an artful negotiator... and that is why my clients hire me. On this site, if you read through things... you'll see question upon question upon question, all good guestions - often posed by people who think they don't need an agent. Sometimes we can answer the questions, sometimes we can't because we don't have enough information, and that stage of the game, the buyer must consult an attorney usually. More importantly, on sites like this we are not held accountable for the advise that we give you... if you're taking advise on the most important transaction of your life (at least one of), then don't you want that person to be working in your best interest and accountable if they say the wrong things? I sure would.
Before I was an agent, we bought a house from a builder without an agent. I have been wondering for the last 15 years how different it would have been had we had an agent. My neighbors all got better deals than us, even though the builder rep told us we were getting an additional incentive because we didn't have an agent. Not to mention, it was an excrutiating process.
The truth is, you may never know what advantages your agent brings to you... but the right agent brings many. When I got my license was when I was able to see the transaction so differently. It opened my eyes. You may not believe me... you may not understand... but, truly, get an agent. Just trust me.
I haven't gone into it, and I won't, but the real question is... why WOULDN'T you have an agent? I honestly would like to know what your concerns are. Maybe in understanding what hesitancies you have, we can help you put the pieces together. There really is no down side.
I don't change my own oil. I probably could, but I don't. I don't do my own major home repairs. I could probably do some, but I don't. I don't cut my own hair - I've tried, it didn't work well. We don't usually do surgery on ourselves - doesn't sound too smart. As I've gotten older and more mature, I've realized there are just some things you should hire someone to do - like save you money - especially when you usually don't pay anything extra for it. I now hire my financial planner and tax advisor. Why? Even if I do pay out of my pocket, they truly do save me money... even after the expense.
Best of luck to you.
there is no educational or liscence differene between a listing agent (the one with the sign in the yard for sale) and the buyers agent, (the one driving you around looking for houses)
each agent, like attorneys, represent their respected client.
The home seller agrees to pay the listing agent a lump sum commission, usually 6% for which he will split with the buyers agent if that agent can bring a customer to buy the house
should you the buyer use the agent representing the seller?, yes you can, its called a dual agency, but ask yourself,....would you use the sale attorney representing the other side of a divorce??? best to use your own agent!
The seller of real property enters into an Exclusive Seller's Agency Agreement with a Realtor. This agent is known as the Listing Agent or Seller's Agent. The Listing Agent represents the Seller and acts in the seller's best interests.
A Buyer may choose to be represented by entering into an Exclusive Buyer's Agency with a Realtor. The Buyer's Agent then represents that Buyer and acts in the buyers best interests.
A Buyer may choose to be unrepresented. There is a place in the real estate contract to indicate that the buyer has chosen to be unrepresented.
For more information about Buyer's Agency, please read the section under Buyers on my website.
I really don't have to say anything to "discredit" anything you said. You did that all by yourself.
Do me a favor and please do not make anymore references on this board that I am a liar or that I mislead consumers and most of all never again say that I agree with anything that you write.
Just out of curiousity.. How much time did you invest in finding your home, making appointments and checking comparables and how much was your home originally listed for that you are buying for $800,000?
ACTUAL FACT: real estate agents are not required by law to have any kind of college (or even high school education.) Unlike all other professional occupations that agents like to compare themselves to. They are therefore not "professionals" at all; as a legal "professional" must possess a professional accredited degree. Where is your professional degree from Renee?
"FACT: Asher is that it's not the listing agent who offers anyone anything. It's the seller who sets the fee for service to both their agent as well as a "buyer's" agent. If no buyer agent existed the fee for service that the seller agreed to pay his/her agent is NOT negotiable to a buyer. Again, the seller is paying their agent to WORK for them to protect their best interests and get their home sold. They are not paying the buyer anything."
ACTUAL FACT: Renee is either blatantly lying, or ignorant to how thing work in her own profession. The fact of the matter is, the seller has agreed to a set commission for the listing agent when the agreement is signed to list the house. This commission could be anything but is usually 5-6% of the sale price. The listing agent can now offer a co-broker commission to an agent that brings a buyer. Again, this could be anything, but is usually half of the total commission or 2.5-3%. It is these commissions that ultimately end up on the negotiating table when buyer and seller are close (but not quite together) on price. A very common practice is for agents on both sides of the deal to give up portions of their commissions in order to close a deal. Do you actually deny this happens Renee?
Brian Smith has the typical smug attitude of real estate agents. They all believe that if you do not use their "services" you will make mistakes. They believe they are worth every penny of the 6% commission they receive for very little work, or are even (gasp) underpaid for such "services." My current transaction will have a sale price of close to $800,000. Which means that an agent like Brian will stand to make around $24,000 for maybe 8-10 hours of paperwork. My licensed attorney will do the same work for me for $240 an hour, or $2400. So ask yourself, "Do I want an uneducated agent doing the same work for 10 times as much as an educated attorney? Is Brian really underpaid? Has Brian been ripping off his clients?"
I have to answer Asher Smith here..First of all what makes you think a selling agent is going to make their commission part of the negotiation? Not likely! First of all if you are dealing directly with the selling agent/broker they are the only person party to the negotiation..they are obliged to bring all offers to the seller (but in my experience many don't and sometimes the buyer broker has to do something) in addition they are not obliged to tell the seller "the buyer is saying I should reduce my commission as part of their offer!) As they "own" the listing and (the agreed upon at signing) full commission if you (who is demanding they lower their commission) doesn't buy the home they are counting on that someone else will!! Also the brokerage has invested a lot of money advertising & marketing the property (and usually gets half of either the seller's commission or both) so the head broker/manager (who has the final say!) never allows the commission to be reduced either! You actually have a better chance getting a break from the buyer's broker who can give you closing gift.
You would be smart to consider the people you are asking this advice from. I posted a similar question on this site only to find the majority of answers from real estate agents telling me lies like the ones they are telling you. First of all, buyer's agents are paid from the proceeds of the sale which originate from you, the buyer. Agents want you to believe that they are being paid by the seller to get you to use their services. They are lying. The listing agent has offered a buyer's agent half of their commissions to bring a buyer. If no buyer's agent exists, 3% of the sales price (the typical buyer's agent commission) is on the table for you to negotiate off the sale price of the house. Companies like Redfin will negotiate a sale for you and refund 2% of the sale back to you. Another lie agents like to tell is that they provide a service as valuable as other educated professionals like lawyers and doctors. You should know that no education is required for real estate agents and the majority of them have never even gone to college. yet they compare their services to those offered by lawyers and doctors. The truth is, the navigation of a real estate transaction is a fairly simple process. Agents on this site like to perpetuate the myth that it is complicated in order to scam the public into thinking they cannot close a deal without an agent. This is not the case, as numerous intelligent buyers have done just that. The way the agents on this site blatantly lie to you should tell you about the ethics of real estate agents.
The buyer agent / broker works for you and will look for and show you homes that meet your needs (that may be listed by many different brokereges also they can protect your interest, by keeping your info confidential and help you negotiate the best price and more..
In New York an agency form is not required for coops or condos \according to NYS Real estate law :Â§443 f. â€œResidential real propertyâ€ means real property improved by a one-to-four family dwelling used or occupied, or intended to be used or occupied, wholly or partly, as the home or residence of one or more persons, but shall not refer to (i) unimproved real property upon which such dwellings are to be constructed or (ii) condominium or cooperative apartments in a building containing more than four units.
here is their definition of a seller's agent and a buyer's agent:
A seller's agent is an agent who is engaged by a seller to represent the seller's interests. The seller's agent does this by securing a buyer for the seller's home at a price and on terms acceptable to the seller. A seller's agent has, without limitation, the following fiduciary duties to the seller: reasonable care, undivided loyalty, confidentiality, full disclosure, obedience and duty to account. A seller's agent does not represent the interests of the buyer. The obligations of a seller's agent are also subject to any specific provisions set forth in an agreement between the agent and the seller. In dealings with the buyer, a seller's agent should (a) exercise reasonable skill and care in performance of the agent's duties; (b) deal honestly, fairly and in good faith; and (c) disclose all facts known to the agent materially affecting the value or desirability of property, except as otherwise provided by law.
A buyer's agent is an agent who is engaged by a buyer to represent the buyer's interests. The buyer's agent does this by negotiating the purchase of a home at a price and on terms acceptable to the buyer. A buyer's agent has, without limitation, the following fiduciary duties to the buyer: reasonable care, undivided loyalty, confidentiality, full disclosure, obedience and duty to account. A buyer's agent does not represent the interests of the seller. The obligations of a buyer's agent are also subject to any specific provisions set forth in an agreement between the agent and the buyer. In dealings with the seller, a buyer's agent should (a) exercise reasonable skill and care in performance of the agent's duties; (b) deal honestly, fairly and in good faith; and (c) disclose all facts known to the agent materially affecting the buyer's ability and/or willingness to perform a contract to acquire seller's property that are not inconsistent with the agent's fiduciary duties to the buyer.
I hope this helps!
Please let me know if I can help you or yours buy a home in NYC at no added cost or any cost to you!