The Buyer Representation Agreement

Chances are, if you are thinking of buying a home you may be hearing about a Buyer Representation Agreement. This is a document between the buyer and their agent. In this agreement the buyer is retaining the agent to help find a property to purchase in a specific market area for a particular length of time. The agreement generally covers the following:

1. Representation: The buyer agrees to work exclusively with the agent.  The agent agrees to work diligently to find a property in the specified market area that meets the buyer’s needs and will assist the buyer in good faith throughout the real estate transaction, working in the buyer’s best interest.
2. Termination: Buyer can cancel the agreement at any time specifying in writing the intent to do so.
3. Compensation: Buyer acknowledges that the agent is to be compensated in the amount of x percent of the purchase price. Currently, here in Rockland, Orange and Westchester, most sellers will offer to pay the compensation when the property is listed for sale. But in the event that the seller does not pay the compensation, or only pays a portion of the compensation, then the buyer will pay the full compensation as a term of the buyer’s offer to purchase.

There are other points usually in a Buyer Agreement, but the above are the big ones. Know that the length of agreement, the market area and the compensation are all to be worked out between the buyer and the broker/agent and put in writing prior to going out to look at properties.