A savvy, professional agent who is well trained, will meet with you at the beginning of your relationship for a consultation. At that consultation, the agent will ask you thought provoking questions to find out what is important to you, present how they work, their business philosophy, and details on the services they provide.
At that consultation, the agent is wise to present the Buyer Agency Agreement, explain the benefits to you, and ask for your commitment to work with them. At that point, when you both signe the Buyer Agency Agreement, you and the agent know you are both in a committed relationship and that the agent will work harder for you and provide a higher level of service.
A signed Buyer Agency agreement is to your benefit, because when an agent knows you are committed to working only with them, they are more motivated to give you 100% of their energy. Without the Buyer Agency agreement, they do not have the same level of commitment to you, because you haven't committed to them.
I think the timing of seeing the Buyer Agency Agreement is what is bothering you. I agree, it definitely feels funny to just have it slipped into a pile of documents. You may just want to have an open, honest conversation with your agent. Hopefully, after that conversation, you and the agent will feel good about committing to work with each other.
These Buyer Agency Agreements should have a couple of things in them that make the obligations and requirements clear to both parties. Are you, as the Buyer, responsible for paying your Real Estate Broker? Some Brokers require an additional payment from their Buyer clients, beyond what the seller pays. Best to have this in writing, so there are no misunderstandings. How about some language articulating that the Broker cannot share confidential information about you with others, even after the transaction closes? The Broker will want assurance that you will be working with them from start to finish, and not take advantage of them to do the leg work of showing homes when you have the intention of having a friend or relative write up the offer. That's reasonable, given the level of responsibility and trust required in a transaction. Buying a home is an important financial and legal endeavor. Why start out the process with unclear and undocumented expectations and intentions? Best to be clear with everyone concerned, so that the likelihood of misunderstandings further down the road are diminished.
Along the same lines, when I take a listing, I tell people they can "fire" me any time they want, even if there's time left on the contract. It's just not worth it to force someone to work with you if they don't want to.
It's my opinion that it's actually kind of rude to expect someone to commit to you before even knowing if they want to work with you. You don't get engaged on the first date.
NWMLS form 41A is a Buyers Agency agreement. Generally it states that the agent represents you and your interests alone. You should have also received a Law of Agency form as well which explains this in greater detail. To my knowledge, NWMLS does not require this but clarifying agency is important.
What I would encourage you to look at is the term of the agreement and exclusive or non-exclusive line. Make certain you understand what each entails and that you are comfortable with each. If not, discuss it with your agent and try to come up with something you are both comfortable with.
I use these forms too, but explain them to my clients in advance, so there are no surprises.
Great answer, it really cuts to the heart of the issue.
I find it a solid business practice to advise the client what to expect when dealing with me. Yes, a handshake and a nod is great, but what happens when that falls apart? In the end, we should all feel comfortable when everything is in writing! Why would the 41a make you nervous? If you built a relation with your realtor, then, you can be assured he/she will do everything possible to make your buying experience a smooth one.
If you are using lots of agents to see houses and a different agent to buy a house, that could be the trigger for the 41A being "needed". It doesn't protect them entirely against a Procuring Cause claim from the agent you saw the house with, but NAR guidelines are that Procuring Cause panels are urged to heavily weight the 41A when making a decision as to whom is due the Buyer side of the commission.
You said "making an offer electronically". Are you "electronically" buying it from the same agent /brokerage you viewed the home with?
Your broker is either lying or misinformed/mistaken. Either way I would seek out recourse. This is a serious and egregious attempt to to take advantage of a situation. The NWMLS does not require this form as part of a Purchase and Sale Agreement.. This type of action helps give brokers a bad reputation.
The reason this is such a hot topic is that it comes down to a realtor's ability to have a written contract that helps to make sure they get a paycheck if they provide real estate services to a buyer. A common realtor fear (that actually happens now and then) is that while working hard to help a buyer find a home to buy, they will show a buyer many, many homes, spend endless hours, fuel, office supplies etc..., only to have a buyer walk into an open house and buy a home from that open house agent, thereby costing the first realtor a substantial loss of time, income, etc... So a part of this form's purpose is to establish a written contractual agreement that puts the exact compensation an agent wants/expects in plain view, for better or for worse.
Some folks like this form, some do not. I do not use it myself because I hope to anchor my client with my skills and charm and I also spend some time to make sure my client understands that if they write a contract to buy without me acting as their agent, I will not be able to feed my wife and 3 cats :o)
I also make sure to explain my "agenda" in our relationship. I not only want to make a paycheck one time, I want my clients to come back (repeat) and send (refer) me the business of their friends/family/co-workers/etc... I tell them plainly that if I do a lame job, they can fire me; but if I do a great job, I expect them to remember me to their pals. I tell them that the real money in real estate comes from repeat/referral business, so my goal is to make a client for life. This clarifies for my clients that while I want to make a paycheck, I need to make good, solid relationships.
So there you have it, one of many realtors, with yet another opinion, giving you an answer and a blatant plug for being a good realtor. Best wishes on your home hunt,
President, Team Golden Homes
Managing Broker, RE/MAX Performance Plus
I personally don't currently use it. I used to many years ago. I prefer I good old solid hand shake and an verbal agreement we are working together. Trust is the beginning of any good relationship;-)
There is one situation where the buyer's agency agreement benefits the buyer, but it's rather rare. If the agent happens to show you one if his/her listings, then the agent will be a dual agent and anything you told them should clearly remain confidential, including discussions about what you want to offer on the particular property. Absent that, if you slip up and let the agent know what you're willing to offer, the agent will likely convey that information to the buyer. Even so, personally I'd be reluctant to give that information in a dual agency situation.
I always explain the relationship to the client on the first meeting, as this prevents any misunderstandings about who is working for whom. If the client refuses to sign, they don't have to, I just mark down that refusal.
The regulation in your state may vary regarding disclosure.
No, the NWMLS definitely does NOT require this. It is an agreement between you and the agent/brokerage
that is purely voluntary.
Managing Broker Associate
John L. Scott