Every state varies with how real estate agents can handle transactions and the clients they represent. Currently in Vermont, agents can represent a seller, another real estate agent or you, the buyer. During your initial visit with a real estate professional you will be given a disclosure about representation and asked to sign this form.
Note what it says at the top of this disclosure. “This is not a Contract,” and “This mandatory disclosure shall be given to the consumer at the first reasonable opportunity, and must be given to the consumer before discussion of confidential information; entering into a service agreement; or showing a property.”
Signing the Mandatory Consumer Disclosure is not agreeing to have the agent represent you. It is merely acknowledging that the agent has advised you about representation. If you are looking with an agent for the first time and therefore have not had a discussion about being represented, and have not signed a contract to be represented, you should not disclose too much information about your motivation, timing or anything you might not want a Seller to know. As you look at the property, the agent is either the Listing Agent or is acting as an agent for the Listing Agent.
Buyer Agency is when an agent represents you, rather than the Seller or the other agent. It only occurs when you sign a fairly extensive contract for the agent to represent you. You will want to fully understand the terms of such an agreement. There are two types: Exclusive Buyer Agency and Exclusive Right to Represent a Buyer.
Before signing any agreement, the agent will discuss your specific needs, like price range, type of property, etc. and area in which you want to purchase. They’ll explain the various term of this agreement. The agent will go over how they will be compensated for representing you. They’ll discuss what happens if they and their firm are representing a Seller and you, being represented by them also, become interested in purchasing one of their firm’s listings. In Vermont, agents and their firms can’t represent both a Seller and a Buyer. This is called Dual Agency and is prohibited so your agent will explain what will happen should you become interested in one of their firm’s properties for sale.
Before signing any agreement for representation, you should have a thorough discussion with the agent as to the pros and cons of such an arrangement, both in finding a property for you, what happens if you find one on your own, how you can even look at a property not on the market, what the agent can and can’t do for you and how representation fits into the whole process of purchasing.
A good agent will be patient listening to your needs. They will explain the pros and cons of representation as it relates to you and can tailor a program for you. Whether you choose to be represented or not, it’s not something you have to decide right away. You can look at properties with more than one agent, you can have one agent show you different properties offered through the Multiple Listing Service and you can take your time understanding the whole buying process. Just remember, if you’re not being represented by the agent you’re with, be careful with information you wouldn’t want to share with a Seller.