Because you have a variety of choices, we’ve decided to describe your options when you look at property. Understanding representation has plenty of advantages and some disadvantages, depending on each real estate firm and the way they practice according to the Real Estate Commission’s guidelines. We’d be very happy to discuss these with you in depth but here are just a few of the major considerations:
- The Vermont Real Estate Commission mandates that at first substantive contact, real estate agents disclose the nature and types of representation to you. Signing the Consumer Disclosure does not mean the agent represents you.
- You are only represented if you sign a contract for representation. You may want to work with various agents prior to making this decision. You may also want to work with an agent for a while before signing a contract for representation. Signing an agreement before seeing how well you work together may not be in your best interest. And some firms by choice or size can’t represent you with their listings because, unlike us, they don’t practice Designated Agency. See our Representation page for a discussion of Designated Agency.
- You should be aware of the advantages and disadvantages of signing a Buyer Representation Agreement before making a decision. You can decide at any time right up to making an offer that you want or need to be represented.
- Before signing the legally binding Buyer Representation Agreement, you should understand all of the types of representation, especially if you feel you might find a house yourself that is not listed for sale. There are different kinds and terms of Buyer Representation Agreements.
- In our firm, we practice Designated Agency, where one of our agents represents the seller and another, the buyer. Each office should disclose to you their policy in the event they are representing you (or not) and you become interested in one of their listings. An agency’s office policy could mean that after spending months being represented by your agent and the firm, you now have to work with someone from another firm you don’t know, in order to have representation and to write up and present your offer. And at that time, you may have to pay the new Buyer Broker a fee or commission. This recent change, which we adopted, prevents this from happening but may not apply to all firms.
- At Vermont Homes Real Estate, your agent or another in our firm will always represent you when you sign a Buyer Agency agreement.
- Your Buyer Agent can completely advise you about a purchase. This will include everything from location, school quality, overall desirability, the asking price and so much more. The agent can also discuss a strategy for making an offer and discuss the various what-if scenarios.
- If you decide to be represented, choose an agent and firm very carefully. The highly technical nature of the modern real estate transaction can involve thousands of dollars of your deposit money. An experienced Realtor knows how to protect you when making an offer, writing a contingency or solving inevitable differences between you and the Seller.
- Don’t assume that you’re going to get a better price for a property just because you’ve chosen to be represented. Sellers have ‘bottom lines’ just like you have a limit on what you’ll pay. Realtors try very hard to have a win-win transaction and most go fairly smoothly but having an agent represent you is no guarantee that you’ll get the property for less.
- If you decide to not be represented, the agents are still charged with treating you fairly and making full disclosure. Any significant defect that would effect the marketability of the property still needs to be disclosed to you. If you choose to be unrepresented, you should be careful not to discuss your ‘bottom line’ price or say anything that you wouldn’t want the Seller to hear. And if unrepresented, you should rely on your attorney’s direction throughout the transaction.
- Who will pay for the services you receive? Often but not always, if a property is listed for sale, your agent’s compensation will come from the commission. You should be sure to understand the financial ramifications to you before you sign a Buyer Brokering Agreement if the commission on the property for sale is not going to be compensating your agent. Likewise, you should understand the compensation arrangement in the Buyer Brokering Agreement should you buy a property not listed for sale.
- Don’t assume that because you’re represented, everything will be taken care of for you. You still have to understand the transaction and continually communicate your needs to the agent. You and the agent work together to get to closing. There may be others involved as well, lawyers, loan originators representing banks, appraisers, structural inspectors and sometimes other contractors. Have the agent explain the process to you, especially before making an offer.
- Either way a good Realtor can guide you through all of your choices and make sure that the buying process is a positive experience.
- If you’ve gotten this far, you’re probably saying, “I just want to buy a house.” Call or contact us.
There is life after closing.