Home Buying in Atlanta>Question Details

Annie Rose, Home Buyer in Atlanta, GA

Does the state of Ga require an exclusive brokers agreement be signed before a realtor can show you a house ?

Asked by Annie Rose, Atlanta, GA Thu Jul 29, 2010

I'm looking to buy a house. I've been identifying properties myself the last year and a half. While talking with my mortgage banker, he recommended I speak with a friend of his who might have unpublished listings in the area I'm interested in. Well, I met the broker and was seriously disappointed. He was arrogant, he was late, didn't have any information on the area I was interested in, couldn't even cough up a business card and kept telling me that I would need to sign an exclusive contract with him because it was a state law... I kept thinking of the number of people especially older ones he might have scared into signing a contract with and felt disgusted. I cannot find anywhere that states Georgia requires an exclusive brokers contract be signed before a realtor can enter a home with a prospect.

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You do not have to sign an Exclusive Buyer Brokerage Agreement. The only time you will need to sign one is when you have a Realtor that is representing you as a client; then one needs to be signed prior to submitting an offer. Your experience with this realtor does not seem to make you comfortable. I would recommend that you interview several agents, so that you can make an informative decision which one would fit your needs. Feel free to call me at 678-613-5636, Regina Ambrose, Chapman Hall Realtor, so you can ask me questions and I can convey my qualifications and knowledge.
0 votes Thank Flag Link Thu Jul 29, 2010
The answer is yes and no. If, you found an agent who was willing to drive to a property that was not his or her listing, to just let you in the door, not give you an ounce of professional advice, and close the door behind you, then no you don't need to sign a brokerage agreement. What I would have you sign to cover myself, is a customer acknowledgement stating of what kind of relationship we would have which is called a customer relationship. In this relationship the agent has no duties to represent your interest. The agent is allowed only to provide "Ministerial acts" which means those acts described in Code Section 10-6A-14 and such other acts which do not require the exercise of the broker's or the broker's affiliated licensee's professional judgment or skill.

Most professional agents want to do their best and represent your best interest as a client. We are here to help and therefore don't want to see anyone making a poor decision in one of life’s most expensive purchases. That's the real purpose of the brokerage engagement to create a relationship where the client receives the most professional advice and the client’s interest is protected.

As soon as an agent starts giving you professional advice without an agreement he or she is out of compliance BRRETA. So, the agent who goes around showing properties and giving their professional opinions and advice with out a brokerage engagement, you are out of compliance with Georgia Real Estate Law. Having a Buyer sign a brokerage agreement at the last minute just before you write a contract doesn’t mean you are in compliance if you have been treating that customer as a client.
4 votes Thank Flag Link Thu Jul 29, 2010
The answer is no, if the agent is a dud, move on. I cannot count the times I've forgotten to get that signed, often it comes up as I'm writing the offers. I don't want to work with every potential client and every potential client doesn't want to work with me.....you know pretty quick how you match up and it's imperative that you work well together.

Hank
3 votes Thank Flag Link Thu Jul 29, 2010
Thanks Hank. I posted a reply below thanking you, but I accidentally left out your name. Your answer was so clear and easy to understand. Please read my question below. Please send post an answer to my question Thanks.. I'm Foxxynana!
Flag Wed Feb 19, 2014
Thanks very much for your very clear answer. We are planning to buy a home in near Savannah, Ga. The agent who contacted us says we have to sign an agreement according to Georgia Real Estate Law. I felt suspicious about this and decided to start checking to find out if this is true. I told her my misgivings, but she has begun sending us lists of houses via her website. My question is, if we find a house we like there and decide to buy it, do we have to use this agent? After all I discussed my misgivings about prior to her sending them. I cam her to find out if she was being truthful. I don't think she is being truthful, so I don't feel comfortable using her.
Flag Wed Feb 19, 2014
State law prohibits Broker from representing Buyer as a client without first entering into a written agreement
with Buyer under O.C.G.A. § 10-6A-1 et. seq.

Above is the exact language that appears at the very top of a buyer-broker agreement. The key word is "client" and if you want the agent to represent your best interests and work for you and you only, then yes, there must be an agreement in place. If an agent is willing not to represent you and still waste their time showing you a property with no guarantee of getting paid for their services, then I guess they can do that. You, on the other hand, if you want a door opener, and no professional advise, no guidance and no professionalism, then no, you don't need an agreement. So, it may be a matter of semantics, but to give the agent a benefit of the doubt, you must have an agreement in order for the realtor to treat you as a client. The difference you will see is between the word client and the word customer. I disagree that an "offer" is the criteria wether you are being represented by a realtor as a client or not. If they open the door and you ask for their advise they may be treating you as a client, therefore, an agreement would be required. Do you want a realtor on your team or not? My suggestion is to find one you trust, who is professional and one you are comfortable being loyal to through a buyer broker agreement. The agreement protects you and the agent fairly. If you need help locating that type of Realtor, let me know and I would be glad to suggest one that might specialize in your area and hold to the standards you might be seeking.

Sincerely,
David Brower, Managing Broker
Crye-Leike Realtors
678-982-9600
david@davidwbrower.com
3 votes Thank Flag Link Thu Jul 29, 2010
Greetings Annie,
You don't have to have the document before you can view a property.

Sometimes it's a guage of sincerity, sometimes a misused filter.."I'm not doing anything for anyone who won't sign an agreement." Superseeded only by the infamous..."I'm not doing anything for less than x% commissions." To each his own.

Real estate is difficult, the rules are in flux, the playing field is uneven and there are many, many victims. Agents don't want to be the victim often to the detriment of building new relationships. I had a buyer couple absolutely BESIDES themselves because I wasn't jumping at the bit to spend hours showing property with no proof of their ability to obtain a mortgage..."sigh...You mean we can't even see a house without a proof of funds statement?" That isn't what I was saying but explaining you are wasting your time AND mine without knowing how much you can spend didn't go over too well. People want what they want.

Everyone has thier own method of operation and truly believe that it is the "right" way because it is THIER way. One Size does not fit all! You have identified that you are not a fan of having a contract shoved in your face when the other party has not shown any VALUE to you. Now that you know what you DON'T like the weeding process has just gotten easier.

Take your time, interview agents and work with someone you feel comfortable with.

Good Luck!!
2 votes Thank Flag Link Thu Jul 29, 2010
The state of Georgia does not require you to sign an exclusive brokers agreement. The brokers agreement is designed to protect the broker from buyers and sellers. This agreement will also qualify the potential client to see if they are serious or not. Please don't take offense to this agreement. There are many expenses that are involved in real estate. Real estate professionals will usually not spend a great deal of time with someone if they are not serious. A great mind said, If you do not sign the agreement, you can have my hands and feet. If you do, you can have my hands and feet and my mind.
1 vote Thank Flag Link Mon Dec 3, 2012
RE: Ana
Ana, I think you and so many other agents posting here, and reading these posts may need to retake the course on “agency”. Nowhere in Georgia law does it say you must have a signed agreement when you "know we are a good match for each other". Now, if you make it clear up front on just what your relationship is going to be a “customer”, take them out show them property, but remember, you are simply a doorman and a scribe, give no advice or professional guidance. I might caution you though that if you are the one sending them properties that you feel are a good fit and are then showing them these properties, you may already be giving them professional guidance. Be careful.
Your statement "This is required if you were represented by a buyer's agent at closing" is simply not a correct answer. The agreement is to be signed prior to you entering a client relationship not just if you represent them at closing.
Brokers and agents need to get a better understanding of just what agency means, how it affects them and how it opens the door to lawsuits if it is not handled correctly. With more and more brokerages popping up with no real broker guidance it's understandable why agents do not seem to understand or adhere to the most basic real estate laws and practices, and why the general public is so confused on just what is truth and what is fiction.
1 vote Thank Flag Link Thu Aug 12, 2010
I gave out quite a few thumbs up - Scott, Hank, Robert, Strom and David.

Some agents just don't understand brokerage relationships and how the law effects these relationships.

For me, one thing is more important than the defined relationship (even if that relationship is for just one showing). That one thing is the simple proactivity of making sure that I get paid, if I expect to get paid.

Annie - your mortgage banker introduced you to just one of the many business people who have a real estate license in Georgia who have the distinct skill of turning folks off when they open their mouths.

Agents should be more like Hank Miller.

If all agents were clear, succinct, forthright and understandable, when they initially engage a potential new client, then folks like you would not ever feel "disgusted."
1 vote Thank Flag Link Sun Aug 1, 2010
Dear Annie,

From what you say, it sounds like a very good thing that you did not sign the agreement with this agent. If he in fact did not fully explain what the law DOES require and tried to trick you, then he violated the law and the Gerogia Real Estate Commission should know about it.

The answer is no, GA law does NOT require you to sign an EBA for an agent to show you a house, or for that matter to "work" with you showing you 20 more houses and even writing a contract on one.

Now having said that, there is a lot of confusion among the public in general and a surprising number of agents as well (as this post shows) with regard to what an agent is allowed to do for a buyer without a written Brokerage Agreement, and what the implications are to the buyer (and agent) when an agent merely 'works' with a buyer (who in the absence of a written EBA is automatically a "customer").

I gave a thumbs up to Strom Thurmond because he summed up the issue pretty well and I would urge any agent who "works" with buyers and then signs an EBA later, or never, to read the last paragraph of Stroms post - if you give professional advice and counsel to a "customer" you are not only out of compliance with the law - my attorney tells me you have set yourself up for possible lawsuit from multiple parties in the transaction including the seller and the very buyer you worked with. In many cases, your actions may also make you an "undisclosed dual agent" - a very serious infraction.

What a lot of agents correctly point out is that you as the Buyer are far better served and protected when an agent represents you as a client, (which can ONLY be done by entering into a written EBA with the agent) than when you work with an agent as merely their customer. That is undisputably true.

Now let me point out something that no one ever touches on - the EBA does more than just assure you of the agents best service and charging the agent with the duty to represent your best interest to the best of their ability (whatever that is) - under an EBA your agent is held to higher standards of conduct and is responsible to use due care and to perform with at least minimal industry competance while serving you.

When you DONT have an EBA to be represented and are merely a customer, short of outright, blatant and provable fraud, and certain illegal acts of the agent, you as the "buyer customer" can not take action against, and hold the agent accountable, for their actions, mistakes, or failures to act.

Thats why you should NEVER work with an agent without an EBA - you are exposed to too many risks. Any quality agent (who understands the law) will for your own protection, insist on your signing an EBA or they wont serve you - I am in that category. To do otherwise is a disservice to you.

SOLUTION - interview some agents and review thier websites and you should be able to determine who the best agent is, but if you are still uncomfortable, then you can sign a one day or two day EBA to see how they work - a "try it before you buy it" approach that leaves you protected, and still leaves you an out if the agent is a dud. There is never a reason to be unprotected - trust me, you want and need more than a taxi driver and a door opener!

As far as unpublished listings, all good buyer agents are aware of at least some of those. As for your identifying homes "for a year and a half" that seems to me glaring proof that you need your own expert! I work with both investors and home buyers and even with all the extra due-diligence I perform, in over ten years it has never taken me over 42 days to find my client a property they loved and wanted to buy. In taking that long, I guarantee you have missed many opportunities - I have seen it too many times when clients come to me who have been looking on their own or with an agent for over 6 months without success. Fortunately we are in the best buyers market of all time - and at least for now some of the best mortgage rates of all time. Let me assure you, as a consumer you can not access as many accurate and available local listings on a consumer website, as are available on the multiple MLS databases we as realtors use.

Annie, I would like to talk with you about your criteria, and if it is realistic, provide you with unmatched Buyer Representation and Protections to help you quickly find the ideal property. If your criteria is not realistic, I promise to shoot straight with you and let you know, and then let you know what is available.

See http://www.TheHomeBuyersRep.com for more information on my unmatched buyer representaion services.

For more information on the subject of Buyer Brokerage Agreements, see the web reference below for my recent blog post on this very subject.

Regards,

Robert Whitfield
Broker/Owner - Realtor
Professional Buyers Broker
Relocation Expert
ICC Code Certified Building Inspection Expert
Advantage Realtors
678-585-9691
877-787-716
1 vote Thank Flag Link Fri Jul 30, 2010
Thank you for your reply, it was very informative. You sound as if you actually work with and for your clients to find them a place to live. I too have been searching for about 10 months now and have lost several homes becaue the appraisals were too low. At no time did my agent come to me with homes to view but always requested that I bring them the MLS numbers of houses I wanted to see. The most action I've gotten from an agent is to sign me up to automated listings. I too have a job and while I respect my agent's time and expertise, their availability seems to be limited to Monday through Friday 9-5. I can take some time off work, but a little give and take would be nice. Locking myself into an exclusive agreement with someone who is not available to show me homes has left me sitting in a rental appartment far longer than I thought I would be. Unfortunately you are under the impression that all Agents are as professional as you are when in reality most are not.
Flag Mon Aug 19, 2013
One answer below is "scary" in that it misrepresents what Georgia Law requires. Brokers don't "just need" a Buyer Agency Agreement "on file".

But the short answer to your question is No. You do not have to have a Buyer Agency Agreement for someone to open a home for your viewing pleasure.

But if you want that Agent's opinion, guidance, thoughts, etc. , by law, they are required to have entered into a written Agency relationship as eloquently stated by Mr. Brower:

State law prohibits Broker from representing Buyer as a client without first entering into a written agreement
with Buyer under O.C.G.A. § 10-6A-1 et. seq.
1 vote Thank Flag Link Thu Jul 29, 2010
I have trouble with this being an "Exclusive" agreement. The agent can work with other buyers, even show them houses they showed you and they have special knowledge from you to boot. But, you can't buy a house you find, say a FSBO w/o paying an agent that had nothing to do with it. I can see where an agent may only want to work with one of these agreements in place, but that shows lack of faith in your buyers. You don't trust the buyer, but you want an agreement that forces them to trust you. It s/b a two way street. I'll pay you when you help me. If you don't perform, I'm still stuck with you, but if I don't come through, you sue me. When I have an agent help me and I stop into an open house or FSBO, I drop their card in to let them know I have an agent. If they won't share commission, them I'll sit down and negotiate with my agent an appropriate payment for their help, or walk away from the house. Your agreement is to screw the buyer! Yes, it spells out your requirement under the law, but the law doesn't require you to put me in indentured servitude for six plus months. Make it Non-Exclusive and specific to your performance and I'll sign it, but some of you don't trust your own professional abilities to let your skills do the talking. I've never been asked to sign one of these hideous contracts, and I never would. i sold my own house and hired a RE attorney to handle the papers and legal stuff. I'd do something similar when I buy if necessary, but I'd rather use a professional agent and pay them accordingly, just not get tied to them for six months and find out later they are worthless. You can walk away from me if I'm worthless, but I can't walk away from you. Not very professional, if you ask me!
0 votes Thank Flag Link Wed Oct 15, 2014
I think one thing that is well skirted in all these answers is weather you must sign and "Exclusive" Buyers Agreement. I dont believe the law says your agreement must be exclusive. "Georgia law requires that licensed real estate agents inform potential clients of the various ways in which they practice their craft and represent their clients. This is that disclosure". In simple language there just must be something in writing that says the agent is your agent and represents you and that is the manner in which he is working with you. It does not say you cant have more than one agreement with more than one agent no that it cant be for one day or for one property. Many agents probably truely believe you must sign such an agreement because that is what thier broker is telling them. If you read the law it does not say that. An "exclusive" agreement protects only the agents not the buyers. But agents are simply not going to offer anything else, They dont want to put the time in if you are going to jump to another agent or buy on your own from a FSBO. While I appreciate that, it used to be the agent that found the property you purchased, got the commission. It was much more compititve. If they all require an exclusive agreement or no agreement at all, then the buyer must choose one agent only, and hope it works out and that they dont run into an incredible FSBO along the way. At least untill the EBO expires. They have done well to protect themselves, using a law that was meant to protect the buyer I used to be an agent ions ago and am for the first time in the market again as a buyer. I am not real excited about the changes in the industry, but I guess as there is less and less loyalty in the world everyone feels thay have to cover thier own skin.. Yes agents got burned before the exclusives and it happened to me plenty, but then there were always the buyers that I was able to help better than the other agents they had worked with and I still got sales. I made what I earned and did not have to lock my clients in.
0 votes Thank Flag Link Mon Nov 26, 2012
This is a good answer. I just read one of these hideously one-side "Exclusive" Buyers Agent Agreements a broker asked my daughter and her husband to sign. It binds the "Client" to indentured servitude, and the broker to almost nothing. I wouldn't mind signing a "Non-Exclusive" agreement, especially as a matter of food faith to the broker helping me, but to say I can't even look at or buy a FSBO or my Uncles House w/o paying a commission for squat. I don't think so! If they act in dual agency anyway, why do I need another broker? I feel obligated to pay an agent that helped me buy a house, even if it was a FSBO or my Uncle's if they provided a service, and pay out of my own pocket. But, this thing is a prison. If they don't perform they still can ask for commission if someone else has to handle the deal. Sure, If you help me buy a house, you earned the commission and I'll agree to pay you, but no more. I'm better off just going to the listing agent to gain access to a house!
Flag Wed Oct 15, 2014
If you find an agent who you like and get a close relationship with, the agent will present you with an exclusive buyer brokerage agreement. I never get a prospect to sign one of these until I know we are a good match for each other. Once you purchase a home the agent will one of these secured to have on file. This is required if you were represented by a buyer's agent at closing. I do not make a habit of popping this contract on a buyer's face the first time I meet. Sounds like this agent needs some classes in charm.
0 votes Thank Flag Link Wed Aug 11, 2010
You are right...there is no such requirement.
0 votes Thank Flag Link Wed Aug 4, 2010
"Thank you Scott Askew. That was really unprofessional of you. Can we all be entitled to our own opinions without being blasted by another cut throat agent? I wonder how many other agents you blast on all your posts. Maybe you are one of "those" agents Annie is speaking of. By the way, what more do we do with these Exclusive Buyers Agreements? Place them in a file or use them to sue clients....thats my point? My business model has been working great in this tough market."

Congrats on your success, Lindsay, particularly in this economic climate. Before replying to a post, I try to read all of the previous threads as well as the original query. It is always amazing to me how many Agents and Brokers will write something in a public forum like this that might be considered ambiguous, misleading or down right wrong. When the state of Georgia licenses us to follow certain rules they have established, we licensees, at minimum, should do so. I, too, read your original response-before you deleted it-and also would have called that thread out if Scott had not done it. If you entertain a buyer, show them listings, offer advice, and/or begin the purchase process on their behalf without having them become either your customer or client first, you have likely jeopardized your status as an licensed agent in this state, based on the current language from the GREC. Not being a lawyer myself, however, you may consider getting another opinion. Good Luck!

Michael Hammond
SellsRealty@gmail.com
404-538-5499

http://www.SellsRealty.org
0 votes Thank Flag Link Fri Jul 30, 2010
Never having made a very good oracle, Annie, I cannot speak to your timing of this or any other property purchase in this market. My suggestion is if you are absolutely ready to be a homeowner, with all of its responsibilities and potential costs, then go ahead and find something you really love and will not mind owning for several years, whether it may increase in value or not. But taking an advocate's position for a minute, why would you NOT want to sign a brokerage agreement? Considering what all it requires an agent to do, adding in the fact that you can break it at any time, and lastly getting service provided at no cost to you as a buyer, why not? Regardless, Good Luck!

Michael Hammond
SellsRealty@gmail.com
404-538-5499

http://www.SellsRealty.org
0 votes Thank Flag Link Thu Jul 29, 2010
I'll tell yo why, Michael, because it's so one-sided. You tie down a client for at least six months and if you do squat, I still have to pay your lazy @ss if I buy a house on my own. You are not required to do anything, but be Professional. Screw that. "Exclusive?" Sure I'll pay you if you actually sell me a house or help me buy one, butyou can sell a house to another client that you showed me, but I can't buy from another agent if you don't perform. I have a major problem with this "Exclusivity" thing. That agreement doesn't "require" the agent to do anything. Granted an agent does a lot to help and s/b compensated for it, but to say I can't find a home on my own without paying you . . . screw that. If you show me the house, I'm obligated to you. Fine, I accept that. But, you can practice Dual Agency and I can't practice dual Buyership? What's good for the goose is good for the gander. Give me a Bilateral agreement and I may sign it.
Flag Wed Oct 15, 2014
One thing that I see missing from these great answers is DISCLOSURE.
It is required that the buyer be informed as to what agency relationships are at first meeting. Maybe the agent took that for an express exclusive brokerage agreement.
I am sure that if the agent was knowledgeable in that area and not arrogant, you would have signed it without question, because the purpose if it is to better represent your interests.

By the way, it took you over a year to find a home when there are Realtors that can work all that for FREE?
0 votes Thank Flag Link Thu Jul 29, 2010
It is understandable that you felt scared! If you don't feel that person is a good match for you or you do not trust him, I would recommend you interview 2 or 3 other realtors who know the area that you like and move on.

Using a good agent will make things much much easier for you plus it is free to you because the seller will pay all the commissions if the house is already listed with another broker.

Do not this incident pull you back...this is a great time to buy!! Best of luck and please let me know if I can assist you in the process.


http://www.RealtorCarmenGutierrez.com
0 votes Thank Flag Link Thu Jul 29, 2010
Good afternoon Annie-
Georgia State law requires that in order for a Realtor to represent you as a client, that you enter into an agreement.
Most Realtors will allow one free look for a qualified Buyer but then if they see they can work well together, ask the Buyer to commit to them as a Client.
Hope that helps.
Randy Johnson
RE/MAX Greater Atlanta
770 729-8786
0 votes Thank Flag Link Thu Jul 29, 2010
Enough said. Only work with a Realtor that you feel is right for you.
0 votes Thank Flag Link Thu Jul 29, 2010
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