Home Buying in Hagerstown>Question Details

Guy Gimenez, Real Estate Pro in Austin, TX

Who pays the buyer's agent fees?

Asked by Guy Gimenez, Austin, TX Tue Feb 26, 2013

Regarding Maryland customs and practices, I was wondering who pays the buyer agent fees.

Also, some Maryland agents have said that Maryland law requires a buyer representation agreement be executed. Can someone tell me with confidence whether this is the case?

Thanks.

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Answers

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>>>>1. If a seller / listing agent pays the commission, why would a buyer representation agreement state the buyer is paying the buyer agent? Seems odd to me.

Because what happens if you work tirelessly for a buyer and find a home that the seller/listing agent refuse to pay the commission (for whatever reason....discounted, FISBO, etc.). Then the agent still gets paid. It is an indirect way of saying that the buyer is ultimately responsible for the buyer's agents fee. It's a protection for the buyer agent.
0 votes Thank Flag Link Wed Mar 20, 2013
Hi Guy-
I love the way you asked: customs and practices. It has been the custom in Maryland that the seller pays for buyer agent fees-although there can be instances where the buyer pays-so be sure to read and discuss any agreements you sign.
Maryland law requires a buyer to be informed about the types of representation available to potential buyers or renters and the services each provides. However prior to entering a contract for sale or rent an agent must identify who are representing in writing to a consumer.
Hope this helps!
Susan
0 votes Thank Flag Link Wed Mar 20, 2013
Thanks Laura. I have a family member that is seeking to purchase a home in West VA (originally she considered Maryland) and I reviewed the buyer representation agreement where the commencement and expiration blanks (and several other blanks) were not completed and the form called for the buyer to pay the buyer agent, all of which seemed odd.

This agent also stated it was State law that a buyer representation agreement be signed, but it appears that statement is factually incorrect. While it may be a company policy, I haven't found any evidence that state law requires a buyer rep. agreement be signed prior an offer being submitted.

Thanks again Laura.
0 votes Thank Flag Link Mon Mar 4, 2013
Hi Guy,

Once you have a level of comfort with an agent they will ask you to sign a buyer agency agreement. In my opinion this isn't something that should be forced on you until you have decided who you want to work with.

However, it is required that you sign an agency acknowledgement form to let you know how our state handles agency, buyer representation, and dual agency.

Commissions are always negotiable but it is customary in Maryland that the Seller pay all commission for both their agent and a buyer's agent. If anyone is asking you to sign a buyer representation form that makes you responsible for the commission I recommend you look elsewhere. If you find a For Sale by Owner home or purchase with another agent that document will make you responsible for paying commission.
0 votes Thank Flag Link Mon Mar 4, 2013
1. If a seller / listing agent pays the commission, why would a buyer representation agreement state the buyer is paying the buyer agent? Seems odd to me.

2. Can anyone please provide the statutory language that requires a buyer representation form be included when an offer is presented?

Thanks.
0 votes Thank Flag Link Wed Feb 27, 2013
The Seller pays the commission to the agents. A buyers agent agreement is required when presenting an offer on a home. It also shows the agent that you are willing to work with that agent and only that agent to buy a home.
0 votes Thank Flag Link Wed Feb 27, 2013
The seller pays the buyers agent in Md the only thing the seller would pay is a small brokerage fee. Brokerage fees are typically under $300 but do vary by brokerage, ours is $150.

Yes a buyer representation agreement is required for the buyers agent to represent you .

You should also be asked to sign an agency disclosure form at first face to face meeting with an agent that explains whom they represent. This form is required by MD law and simply explains agency to you , it is not a contract.
0 votes Thank Flag Link Wed Feb 27, 2013
Guy,

The form that's required to be signed is called "Understanding Whom Real Estate Agents Represent" and is not a contract, or a commitment to work with an agent. It is a disclosure only required by law.

You can expect most Brokers here in Maryland to charge a fixed fee to a buyer ranging anywhere from about $250 to $450. Not all, but pretty darn most do.

Rich Iarossi
Long and Foster Real Estate, Inc.
0 votes Thank Flag Link Tue Feb 26, 2013
At first face to face meeting a "Whom Real estate Agents Represent", which is simply a disclosure, not an agreement of any type. This is required by Md law. If you choose to have an agent represent you (highly advised!!) , then you must sign a buyers Representative agreement. Your other choice, is to have the agent that represents the seller prepare your offer - downside - their loyalty is to the seller, not you. But they are still required to be honest with you.
0 votes Thank Flag Link Tue Feb 26, 2013
In Maryland the seller pays the the buyer agent fee's referred to the "Co-op" commission. Disclosure of buyer representation has to be executed at the first "Face to Face' contact contact with the buyer, this is required by title 17 of the Maryland annotated code.

Greg Myers
RE/MAX Realty Group
0 votes Thank Flag Link Tue Feb 26, 2013
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