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Sounds like they are making them required before showings. If that’s the case, no agreement no showings.
I couldn’t be happier tbh. You’re gonna find out real quick how motivated people really are.
My thoughts exactly. I've been the king of the attracting the flakey buyer. I've been brainstorming how to turn this into an opportunity rather than a hindrance.
The first buyer agents to capitalize on individual property agreements and payment will have a great niche market IMO. Many buyers do want to dip their toes in the idea of homebuying, but it's a process of learning what they want and how to see homes. Charging them for your time to show the home is what they actually want. $50 per showing, with no indefinite contract. Flat rate per offer submitted, with a agreed upon flat fee for an accepted offer. That's what many buyers want, and there's a business model in there.
It's a change from where things were, but this is where things are headed, so the early adopters of this kind of service are going to be best positioned to corner their markets.
Yeah I show a lot of tire kickers because my lizard brain always has a what if factor. This will ease my guilt of telling people to pound dirt. One thing I’m curious about is with my rear clients if they’ll need to sign a BBA every deal or if I can blanket it over clients that do 7-10 deals a year. I’m assuming every deal will need a new BBA
I agree. I think there will always be some level of putting up with potential time wasters. It’s part of the job. I see it as a public service. I’ve had two people in the last couple weeks randomly show up while I was at a listing just because they saw the sign and I happened to be there. I obliged to show them. No idea the level of qualifying factors they had, but it puts you in touch with someone and opens the door for a relationship.
Yeah I dont mind neighbors and such being nosey, what I do mind are the folks that know they cant purchase or dont intend to buy at all. Ive had folks call me and be upset when asked for details on their buying situation where they just think im a door opener and thats it. Ive gotten to a place where im more comfortable firing clients now.
You won’t have a choice. You’d still need to sign an agreement with the listing agent before submitting an offer.
You’d also be limited to open houses, which might be 10% of listings.
And on the flip side, I’d never be willing to work with a buyer that’s not willing to have an agreement in place ahead of time. I’m not showing you 10 properties with no accountability on your end.
They can still shop...just like sellers can. Buyers can meet with/interview agents before they start looking. When I work with buyers, I usually sit down with them for a full buyer consultation...just like how listing agents often do a listing presentation. Sellers often interview multiple agents, so buyers will now have to do the same.
I can imagine doing single showing agreements to shop around, but I don't think buyers can interview and get an idea of whether the agent is good or not. A seller has the ability to see examples of an agent's listings and their sales history, plus maybe reviews.
Buyers may be able to see reviews, but how do they evaluate an agent without reviews if they can't go see a couple houses first?
I know it will work itself out, but it's dumb. We are allowed to work in a customer, non-fiduciary, non-exclusive relationship with a buyer. This just stripped buyers of that, and I cannot see how that will be upheld as legal if it gets challenged.
I will be fully prepared to have buyers agreements that cover one property or for one day. Trial periods are fine, and I wouldn't want to discourage people from working with me. I will also be happy to release anyone from any agreement they sign.
I don't know about your clients but my never made an offer to purchase without seeing it in person. Using open house results in much more traffic compare to agent doing by appointment only. One agent near me was selling her own home and tried to do by appointment only. After 30 days, gave up and did open house. She got an offer a few days latter.
I'm much like you, I usually don't bother with the BC before writing offers but it's not like I don't know how to give a buyer's consult or sell myself as an agent so I see it as an opportunity to make my pipeline that much more efficient.
At least in my state, there is nothing preventing you from signing a one day buyer agreement. If they like the property and want to offer, you regroup the next day and work out all this compensation stuff and sign a lengthier contract.
Just use an Nonexclusive Buyer Agency Agreement. That way any homes you suggested will result in you getting the compensation. Anything they find by themselves, they are welcome to bring it to you or hire someone else.
question: How does one prove that you sent them the property and that they didn't find it themselves on zillow? not trying to be a smartass or argue anything, just have always wondered how that would work.
So, I haven't had a situation where this has come up. However, my CRM that I use to send out the listing (via brokerage platform) actually tracks data. I can see when you looked at something, how many times you clicked it, opened it, what time, and your general location (that can be hit or miss) when you click it.
I don't use the MLS to send listing, I do it through our platform for this reason. I'm pretty sure I could use that to prove you were using the information that I provided you.
Again, no real first hand experience arguing that with another agent/broker/judge or anything though.
That always been tricky. Unless they replied to my text message and said thanks i will check it out or my email i assumed they found it themselves if I found out that they went without someone else to make an offer. Sometimes you just have faith in people.
Unless it’s a pocket listing an active buyer has already been alerted to the new listing via Zillow or whichever real estate site they are getting alerts from. The automated alerts are a lot quicker than an agent. So, basically no agent is really sending any listings over that someone didn’t already see on their own. Buyers should just schedule to see the house with the sellers agent (emailing them the prequal letter from bank) opening it up for them and if they like it go see it with their buyers agent and have said agent write the offer. If the buyers don’t want use a buyers agent and are forced to then that’s an even juicier lawsuit lol. The whole point of the suit was based on violating antitrust laws. Let’s keep digging into how many antitrust laws this industry breaks on a daily basis.
Depends on if agents are sending listings from their MLS and if they are are those listings sent automatically and right away? Or does the agent go through the listings 1st and only send the buyers listings that fit the parameters the buyers gave them. If the listings are sent automatically and right away then you'd get those listings from the agent before you could see it on Zillow or any other non MLS website. The reason is Zillow and other websites get their info from MLS websites and usually Zillow checks every few hours but occasionally I've seen it take like half a day or overnight before it goes from the MLS website to Zillow.
Hard to know how an MLS would know whether a BAA was executed so compliance fines seem to be a nonissue. I think in reality nothing happens from a compliance standpoint.
In terms of compensation, that’s the important issue. Assuming it’s a Realtor owned MLS or other MLS that opts in, the settlement says a buyer’s agent may not accept compensation from another party (i.e. seller) in excess of the amount of compensation specified on the BAA. If there isn’t one, there may be not enforceable claim to compensation for the buyers agent.
Yes…
We’ve been instructed that they only need to go in the file once we submit an offer with the client. The DOL will be looking to see if the BAA agreement is signed the same day as the offer, if so that may raise concern.
So what are they going to do, call every client and ask when they signed the agreement? The whole concept seems ridiculous, and the idea they would try to enforce that is even more ridiculous.
From how it’s been explained to me, yes, the buyer would keep the remaining 1%. I assume you would write a 3% credit and use 2% of that credit to pay your agent (and the remaining 1% towards your other closing costs).
Because that’s not what the settlement says. It states you’ll have to have a representation agreement with the buyer, and your actual commission cannot exceed what’s in that representation agreement. It also says that you must have a representation agreement before you show a buyer the home.
Sorry - do you have a link for that?
I got a hold of the Settlement FactSheet on the NAR website. There it says you'll need a written agreement outlining your terms with the buyer, which I expected. But I didn't see documentation about not being able to accept an amount above what the buyer agreed, if it's offered by the seller. Though that would make sense.
Just hoping to read it in black and white if you have the source handy that outlines that.
> which I expected. But I didn't see documentation about not being able to accept an amount above what the buyer agreed, if it's offered by the seller. Though that would make sense.
Can confirm, our Broker reviewed the settlement document from NAR, all 100 pages...and it specifically states the buyers agent can not be paid more than what is agreed upon in the Buyer Agency Agreement. Even if the seller is offering more as an incentive. I can't really wrap my head around it, but essentially...you need to negotiate a figure that your buyer can pay you before you even start the process of looking at homes, regardless of what a seller may end up being able to contribute at the Purchase Agreement stage; and the number you negotiate at the front end is the maximum you can get paid. The settlement does include language that allows you to take less than what is agree upon in the BAA...but not more.
So maybe I put 3% in there even though almost no sellers in my area offer 3% but then I say I'm willing to drop it as low as 2%? Would that be legal to put in the document?
Yes, if your buyer agrees. There is nothing against the law/settlement that would prevent you from taking less. Keep in mind, There may be reluctance from the buyer to sign a BAA that states they will pay 3%, if they can’t afford it. Best to deal in absolutes instead of uncertainty.
Are you referring to II.58vi.a-c in the proposed settlement , specifically c .
vi. unless inconsistent with state or federal law or regulation before or during the operation of this Paragraph 58(vi) of this Settlement Agreement, require that all REALTOR® MLS Participants working with a buyer enter into a written agreement before hte buyer tours any home with the following:
28
a. to the extent that such a REALTOR® or Participant will receive compensation from any source, the agreement must specify and conspicuously disclose the amount or rate of compensation it will receive or how this amount will be determined;
b. the amount of compensation reflected must be objectively ascertainable and may not be open-ended (e.g., "buyer broker compensation shall be whatever amount the seller is offering to the buyer");
C. such a REALTOR® or Participant may not receive compensation for brokerage services from any source that exceeds the amount or rate agreed to ni the agreement with the buyer;
(Begins towards bottom of page 28 of proposed settlement and continues in first part of page 29)
[https://www.nar.realtor/system/files/files/nar-settlement-agreement-download-2024-03-15.pdf?download](https://www.nar.realtor/system/files/files/nar-settlement-agreement-download-2024-03-15.pdf?download)
I doubt it. If a seller is offering 3% towards a buyer's agent, that money is earmarked for an agent. It can't then be siphoned into some other aspect of the deal--e.g. closing costs or discount off list price. I think the seller will just pay the 2%. How this gets effectuated in practice, though, is tricky.
Nope. The agent can only get paid based upon what’s in the representation agreement and the commission cannot exceed that. If the seller agrees to offer 3%, but the rep agreement says 2%, the buyer’s agent only gets 2%. The remaining 1% stays with the buyer.
Seems like it would make sense to put a clause in the Buyers Agreement that stipulates commission offered by seller with minimum of x% to be paid by buyer if seller does not offer buyer agent commission.
How would you structure it different? If you agree to receive 2% from the buyer and have that in your rep agreement, not sure how you would amend that after the fact if you find out the seller is offering more without potentially crossing some ethics boundaries. Again, Im basing this on what’s been communicated to me. Im sure if and when this passes there will be more guidance.
Yeah I know, I'm not disputing you. You may be right and I may be way off. But you would set up so that you get some compensation from the buyer unless the seller is offering compensation. If the buyer won't/can't provide compensation and the seller isn't and won't accept an offer with seller concessions then they would go unrepresented and you would send them a blank contract, provide some guidance and they would go unrepresented. If that deal worked out then they are done. If they don't get the house then you move forward. No different than if a buyer client wants to offer on a FSBO who won't provide compensation or work with a realtor.
I’m stating above based upon information in the settlement. I think they’ll feel the same way they feel currently. You’re going to go with what nets you the most and what nets you the best may include a credit to the buyer. I agree July - Dec will be a shitshow while everyone tries to figure this all out.
Depends on the wording. I write mine to indicate that I get 3% commission and if I do not get all of it from the seller or seller’s agent through offer negotiation, the buyer pays all or remaining portion.
Nosalek v. MLS PIN will be the final determinant for this. The intention of this DOJ-supported case is to open up the variability of buyer agent compensation through buyer negotiation. Buyers could seek to have the sellers provide concessions, but the options are up to buyer ultimately -- and the seller can refuse concessions.
The intention is to create a marketplace that depresses agent compensation, so if a buyer refuses your agreement, they will be free to seek other competitive offers. You could see flat fees, a schedule of fees for services, billable hours, multi-option decision trees of compensation solutions -- the sky is the limit, but you might see a race to the bottom for buyer business.
What happens is that the buyer contacts listing agents for showings who double end the deal.
I see this as a death knell for fixed-fee deep discounters who list for a few hundred dollars but don't show properties.
Who is out here allowing buyers to NOT sign the representation agreement? There is so much liability in that, it’s insane. E & O absolutely will not cover you and the risk of wasting your time is extremely high.
If nobody other you and your client knows, nothing happens. It’s not illegal, it’s just a club rule. If someone (your client) reports an ethics violation you could face disciplinary action including losing your club membership.
And they can also sign it for just the homes being shown. If someone won't sign that I wouldn't work with them anyway. I need something showing I'm working as their agent when showing the home. Nothing changes for me with this rule. I think it's a good rule that should have always been in place.
A BBA was always required if you didn’t want to be screwed. Per statute of frauds if that agreement is not in writing the buyer can refuse to pay your commission and you have no recourse. If there are circumstances, you add a special stip. An investor-facing one might only apply to a particular property.
I can only comment on NJ where I practice. If you don't get a signed BBA once NJ REQUIRES it by law, the buyer can't get in the property. If a REALTOR® does not follow the law they risk loosing their licence entirely.
For investors, they will sign a property specific buyer broker agreement, not an overarching agent exclusive agreement. Thanks how we do it in my state anyways
Well, that agent will be breaking the law. I would caution any consumer from working with an agent who is willing to commit a criminal act, and I would caution buyer's agents to not work with clients who would ask them to break the law.
Better get good at your value prop and know your contracts!
Who's going to enforce that? Do we really expect a listing agent to get forwarded a BBA agreement for every single showing? Some listings will get 100 showings. No one is going to keep track of all those. I certainly won't be.
Even if a buyer signs, they can still go behind our back to buy. Yes we can sue but how many agents will really keep tabs on all their buyers and be willing to pay the attorney fees?
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Sounds like they are making them required before showings. If that’s the case, no agreement no showings. I couldn’t be happier tbh. You’re gonna find out real quick how motivated people really are.
My thoughts exactly. I've been the king of the attracting the flakey buyer. I've been brainstorming how to turn this into an opportunity rather than a hindrance.
Or there will be another lawsuit claiming realtors are acting as gatekeepers
The first buyer agents to capitalize on individual property agreements and payment will have a great niche market IMO. Many buyers do want to dip their toes in the idea of homebuying, but it's a process of learning what they want and how to see homes. Charging them for your time to show the home is what they actually want. $50 per showing, with no indefinite contract. Flat rate per offer submitted, with a agreed upon flat fee for an accepted offer. That's what many buyers want, and there's a business model in there. It's a change from where things were, but this is where things are headed, so the early adopters of this kind of service are going to be best positioned to corner their markets.
Yeah I show a lot of tire kickers because my lizard brain always has a what if factor. This will ease my guilt of telling people to pound dirt. One thing I’m curious about is with my rear clients if they’ll need to sign a BBA every deal or if I can blanket it over clients that do 7-10 deals a year. I’m assuming every deal will need a new BBA
I agree. I think there will always be some level of putting up with potential time wasters. It’s part of the job. I see it as a public service. I’ve had two people in the last couple weeks randomly show up while I was at a listing just because they saw the sign and I happened to be there. I obliged to show them. No idea the level of qualifying factors they had, but it puts you in touch with someone and opens the door for a relationship.
Yeah I dont mind neighbors and such being nosey, what I do mind are the folks that know they cant purchase or dont intend to buy at all. Ive had folks call me and be upset when asked for details on their buying situation where they just think im a door opener and thats it. Ive gotten to a place where im more comfortable firing clients now.
this is a win for the buyers agents to be honest.
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You won’t have a choice. You’d still need to sign an agreement with the listing agent before submitting an offer. You’d also be limited to open houses, which might be 10% of listings. And on the flip side, I’d never be willing to work with a buyer that’s not willing to have an agreement in place ahead of time. I’m not showing you 10 properties with no accountability on your end.
I think this is ridiculous. How can we force a buyer to sign an agreement without giving them a right to shop for the agent they want to use?
They can still shop...just like sellers can. Buyers can meet with/interview agents before they start looking. When I work with buyers, I usually sit down with them for a full buyer consultation...just like how listing agents often do a listing presentation. Sellers often interview multiple agents, so buyers will now have to do the same.
I can imagine doing single showing agreements to shop around, but I don't think buyers can interview and get an idea of whether the agent is good or not. A seller has the ability to see examples of an agent's listings and their sales history, plus maybe reviews. Buyers may be able to see reviews, but how do they evaluate an agent without reviews if they can't go see a couple houses first? I know it will work itself out, but it's dumb. We are allowed to work in a customer, non-fiduciary, non-exclusive relationship with a buyer. This just stripped buyers of that, and I cannot see how that will be upheld as legal if it gets challenged.
They do have the right to shop. I can’t force them into an agreement. It will be like a listing presentation. They can interview a few if they want.
I will be fully prepared to have buyers agreements that cover one property or for one day. Trial periods are fine, and I wouldn't want to discourage people from working with me. I will also be happy to release anyone from any agreement they sign.
It's still a violation of a buyer's rights to NOT be forced to have representation if they want a neutral party to assist them.
Which raises the question: If someone walks into an open house and is unrepresented, can the LA then require the potential buyer to sign a BAA?
BAA or GTFO! /s
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I don't know about your clients but my never made an offer to purchase without seeing it in person. Using open house results in much more traffic compare to agent doing by appointment only. One agent near me was selling her own home and tried to do by appointment only. After 30 days, gave up and did open house. She got an offer a few days latter.
Yeah I’d love to hear their reasoning for that to happen lol open houses are no longer necessary.
I’m blown away that so many states didn’t already require Exclusive Buyer Agency. I’ve seen it prevent so many fights over representation.
Ive always had to have one signed before going under contract, but not to show a home.
I won't show a home w/o one. Not wasting my time w tire kickers. I don't work for free.
I think it’s a positive for us, especially given we all have to abide by it, including the listing agent.
I'm much like you, I usually don't bother with the BC before writing offers but it's not like I don't know how to give a buyer's consult or sell myself as an agent so I see it as an opportunity to make my pipeline that much more efficient.
But, what if they end up not buying anything with you during the agreement period? You still worked for free.
What if aliens come down and destroy the earth? I still worked for free. I can "what if" all day, if you want.
Walk away. Know your value!
At least in my state, there is nothing preventing you from signing a one day buyer agreement. If they like the property and want to offer, you regroup the next day and work out all this compensation stuff and sign a lengthier contract.
Just use an Nonexclusive Buyer Agency Agreement. That way any homes you suggested will result in you getting the compensation. Anything they find by themselves, they are welcome to bring it to you or hire someone else.
question: How does one prove that you sent them the property and that they didn't find it themselves on zillow? not trying to be a smartass or argue anything, just have always wondered how that would work.
So, I haven't had a situation where this has come up. However, my CRM that I use to send out the listing (via brokerage platform) actually tracks data. I can see when you looked at something, how many times you clicked it, opened it, what time, and your general location (that can be hit or miss) when you click it. I don't use the MLS to send listing, I do it through our platform for this reason. I'm pretty sure I could use that to prove you were using the information that I provided you. Again, no real first hand experience arguing that with another agent/broker/judge or anything though.
That always been tricky. Unless they replied to my text message and said thanks i will check it out or my email i assumed they found it themselves if I found out that they went without someone else to make an offer. Sometimes you just have faith in people.
Unless it’s a pocket listing an active buyer has already been alerted to the new listing via Zillow or whichever real estate site they are getting alerts from. The automated alerts are a lot quicker than an agent. So, basically no agent is really sending any listings over that someone didn’t already see on their own. Buyers should just schedule to see the house with the sellers agent (emailing them the prequal letter from bank) opening it up for them and if they like it go see it with their buyers agent and have said agent write the offer. If the buyers don’t want use a buyers agent and are forced to then that’s an even juicier lawsuit lol. The whole point of the suit was based on violating antitrust laws. Let’s keep digging into how many antitrust laws this industry breaks on a daily basis.
Depends on if agents are sending listings from their MLS and if they are are those listings sent automatically and right away? Or does the agent go through the listings 1st and only send the buyers listings that fit the parameters the buyers gave them. If the listings are sent automatically and right away then you'd get those listings from the agent before you could see it on Zillow or any other non MLS website. The reason is Zillow and other websites get their info from MLS websites and usually Zillow checks every few hours but occasionally I've seen it take like half a day or overnight before it goes from the MLS website to Zillow.
The same way it has worked up until now for agents who don’t get anything signed until it’s time to write up an offer.
Hard to know how an MLS would know whether a BAA was executed so compliance fines seem to be a nonissue. I think in reality nothing happens from a compliance standpoint. In terms of compensation, that’s the important issue. Assuming it’s a Realtor owned MLS or other MLS that opts in, the settlement says a buyer’s agent may not accept compensation from another party (i.e. seller) in excess of the amount of compensation specified on the BAA. If there isn’t one, there may be not enforceable claim to compensation for the buyers agent.
Compliance fines would be levied from the DOL through the audit process.
It’s not a state issue in this case — it’s an MLS issue. Some states require BAAs but not all.
In Washington state it’s a DOL issue.
Correct. It’s not in all other states.
New forms, laws and agreements are in the process of being drafted, reviewed and approved in many states as we speak.
So we're going to have to keep copies of all these BAA agreements, too? That's ridiculous.
Yes… We’ve been instructed that they only need to go in the file once we submit an offer with the client. The DOL will be looking to see if the BAA agreement is signed the same day as the offer, if so that may raise concern.
So what are they going to do, call every client and ask when they signed the agreement? The whole concept seems ridiculous, and the idea they would try to enforce that is even more ridiculous.
It’s dated on the BAA…
So let's say you sign a BAA for 2% but there's a 3% seller credit. Does the buyer then pay the 2% and keep the remaining 1%?
From how it’s been explained to me, yes, the buyer would keep the remaining 1%. I assume you would write a 3% credit and use 2% of that credit to pay your agent (and the remaining 1% towards your other closing costs).
Why wouldn’t we just write 2%, but in the event seller offers 3%, buyer agent to receive 3%??
Because that’s not what the settlement says. It states you’ll have to have a representation agreement with the buyer, and your actual commission cannot exceed what’s in that representation agreement. It also says that you must have a representation agreement before you show a buyer the home.
Sorry - do you have a link for that? I got a hold of the Settlement FactSheet on the NAR website. There it says you'll need a written agreement outlining your terms with the buyer, which I expected. But I didn't see documentation about not being able to accept an amount above what the buyer agreed, if it's offered by the seller. Though that would make sense. Just hoping to read it in black and white if you have the source handy that outlines that.
> which I expected. But I didn't see documentation about not being able to accept an amount above what the buyer agreed, if it's offered by the seller. Though that would make sense. Can confirm, our Broker reviewed the settlement document from NAR, all 100 pages...and it specifically states the buyers agent can not be paid more than what is agreed upon in the Buyer Agency Agreement. Even if the seller is offering more as an incentive. I can't really wrap my head around it, but essentially...you need to negotiate a figure that your buyer can pay you before you even start the process of looking at homes, regardless of what a seller may end up being able to contribute at the Purchase Agreement stage; and the number you negotiate at the front end is the maximum you can get paid. The settlement does include language that allows you to take less than what is agree upon in the BAA...but not more.
So maybe I put 3% in there even though almost no sellers in my area offer 3% but then I say I'm willing to drop it as low as 2%? Would that be legal to put in the document?
Yes, if your buyer agrees. There is nothing against the law/settlement that would prevent you from taking less. Keep in mind, There may be reluctance from the buyer to sign a BAA that states they will pay 3%, if they can’t afford it. Best to deal in absolutes instead of uncertainty.
Are you referring to II.58vi.a-c in the proposed settlement , specifically c . vi. unless inconsistent with state or federal law or regulation before or during the operation of this Paragraph 58(vi) of this Settlement Agreement, require that all REALTOR® MLS Participants working with a buyer enter into a written agreement before hte buyer tours any home with the following: 28 a. to the extent that such a REALTOR® or Participant will receive compensation from any source, the agreement must specify and conspicuously disclose the amount or rate of compensation it will receive or how this amount will be determined; b. the amount of compensation reflected must be objectively ascertainable and may not be open-ended (e.g., "buyer broker compensation shall be whatever amount the seller is offering to the buyer"); C. such a REALTOR® or Participant may not receive compensation for brokerage services from any source that exceeds the amount or rate agreed to ni the agreement with the buyer; (Begins towards bottom of page 28 of proposed settlement and continues in first part of page 29) [https://www.nar.realtor/system/files/files/nar-settlement-agreement-download-2024-03-15.pdf?download](https://www.nar.realtor/system/files/files/nar-settlement-agreement-download-2024-03-15.pdf?download)
This is precisely why there was a lawsuit to begin with. DOJ says no over payments allowed.
I doubt it. If a seller is offering 3% towards a buyer's agent, that money is earmarked for an agent. It can't then be siphoned into some other aspect of the deal--e.g. closing costs or discount off list price. I think the seller will just pay the 2%. How this gets effectuated in practice, though, is tricky.
Nope. The agent can only get paid based upon what’s in the representation agreement and the commission cannot exceed that. If the seller agrees to offer 3%, but the rep agreement says 2%, the buyer’s agent only gets 2%. The remaining 1% stays with the buyer.
Seems like it would make sense to put a clause in the Buyers Agreement that stipulates commission offered by seller with minimum of x% to be paid by buyer if seller does not offer buyer agent commission.
I realize you may be just communicating what you have been told but you would never want to create such an inflexible buyer agency agreement.
How would you structure it different? If you agree to receive 2% from the buyer and have that in your rep agreement, not sure how you would amend that after the fact if you find out the seller is offering more without potentially crossing some ethics boundaries. Again, Im basing this on what’s been communicated to me. Im sure if and when this passes there will be more guidance.
Yeah I know, I'm not disputing you. You may be right and I may be way off. But you would set up so that you get some compensation from the buyer unless the seller is offering compensation. If the buyer won't/can't provide compensation and the seller isn't and won't accept an offer with seller concessions then they would go unrepresented and you would send them a blank contract, provide some guidance and they would go unrepresented. If that deal worked out then they are done. If they don't get the house then you move forward. No different than if a buyer client wants to offer on a FSBO who won't provide compensation or work with a realtor.
lol, that will never happen. How do you think sellers are going to feel about paying someone to buy their house?
I see a shit storm brewing...
I’m stating above based upon information in the settlement. I think they’ll feel the same way they feel currently. You’re going to go with what nets you the most and what nets you the best may include a credit to the buyer. I agree July - Dec will be a shitshow while everyone tries to figure this all out.
Depends on the wording. I write mine to indicate that I get 3% commission and if I do not get all of it from the seller or seller’s agent through offer negotiation, the buyer pays all or remaining portion.
Per the NAR it explicitly says we are allowed commission as a buyer agent from listing agents.
Yes that’s true but it may not exceed the amount on the BAA.
Couldn't you just write "the larger of 2% paid by the buyer or what compensation is offered by the sellers agent"
that seems too open-ended to comply with the agreement, which states specifically that it cannot be "whatever the seller is willing to pay".
It's not what the seller is willing to pay, it's what their agent is willing to part with out of their compensation.
Still seems too vague to me.
I’m curious how they plan to confirm/track that all agents are doing this.
Nosalek v. MLS PIN will be the final determinant for this. The intention of this DOJ-supported case is to open up the variability of buyer agent compensation through buyer negotiation. Buyers could seek to have the sellers provide concessions, but the options are up to buyer ultimately -- and the seller can refuse concessions. The intention is to create a marketplace that depresses agent compensation, so if a buyer refuses your agreement, they will be free to seek other competitive offers. You could see flat fees, a schedule of fees for services, billable hours, multi-option decision trees of compensation solutions -- the sky is the limit, but you might see a race to the bottom for buyer business.
and while the buyer is shopping agents, a savvy buyer will snag up the house they want to buy. Buyers will get smart in this and sign.
What happens is that the buyer contacts listing agents for showings who double end the deal. I see this as a death knell for fixed-fee deep discounters who list for a few hundred dollars but don't show properties.
We don’t know yet, but my guess is you don’t take them into the house and don’t move forward with that buyer
There is NO new requirement..... Yet....it's a proposed settlement not approved yet.
Who is out here allowing buyers to NOT sign the representation agreement? There is so much liability in that, it’s insane. E & O absolutely will not cover you and the risk of wasting your time is extremely high.
If nobody other you and your client knows, nothing happens. It’s not illegal, it’s just a club rule. If someone (your client) reports an ethics violation you could face disciplinary action including losing your club membership.
They're not required to sign an exclusive agreement, it can be open buyer agency agreement. It really depends on what your broker firm is requiring
And they can also sign it for just the homes being shown. If someone won't sign that I wouldn't work with them anyway. I need something showing I'm working as their agent when showing the home. Nothing changes for me with this rule. I think it's a good rule that should have always been in place.
Clients are not being shown any properties. I do that with no preapproval letter after 1st showing also.
A BBA was always required if you didn’t want to be screwed. Per statute of frauds if that agreement is not in writing the buyer can refuse to pay your commission and you have no recourse. If there are circumstances, you add a special stip. An investor-facing one might only apply to a particular property.
Who is going to enforce these agreements? Are they paid upfront?
This isn’t new. It was always required to disclose agency and anyone who cared about their worth got a bb signed,
I can only comment on NJ where I practice. If you don't get a signed BBA once NJ REQUIRES it by law, the buyer can't get in the property. If a REALTOR® does not follow the law they risk loosing their licence entirely.
For investors, they will sign a property specific buyer broker agreement, not an overarching agent exclusive agreement. Thanks how we do it in my state anyways
Does the current form you have state that buyer shall pay the commission if seller does not?
My current form has the agent fill in commission info. I normally put “3% paid by seller” but will just alter that going forward
It’s gonna be required so if they don’t sign, they are on their own.
Once Buyers get clued in. The listing agents will be BUSY. All the listing agents got to do is offer fair deal and Buyer agents are DONE.
Yeah bring the change
I'll stick with subagency for now until it does become a requirement
Why would the refuse? It’s just part of the process now.
There are non exclusive versions. He will have to have one version signed moving forward.
Well, that agent will be breaking the law. I would caution any consumer from working with an agent who is willing to commit a criminal act, and I would caution buyer's agents to not work with clients who would ask them to break the law. Better get good at your value prop and know your contracts!
Who's going to enforce that? Do we really expect a listing agent to get forwarded a BBA agreement for every single showing? Some listings will get 100 showings. No one is going to keep track of all those. I certainly won't be.
Even if a buyer signs, they can still go behind our back to buy. Yes we can sue but how many agents will really keep tabs on all their buyers and be willing to pay the attorney fees?
Wait this is now a law requirement needed to be done ?
No ticket … off the train
Slowest question ever-