buyer/broker agreement...do you use one with your buyers?

Question

In one week, I lost two buyers. :violin: Both were preapproved, I was working with both, found homes they liked, and with one we put in an offer.

First client went to the house "next door" to the one she put an offer in on, the Realtor was there speaking to the tenants, and my client asked to see the house. She looked at the house, put in an offer, and it was accepted in two hours. She never told the Realtor she was already working with me, and had already put an offer in on the house next door. :chicken:

The second client had to get a pre-approval from the bank that owned the home (even they had been approved by BofA). Went to the other bank, got upset with the manner inwhich the mortgage broker was speaking to them, (very condensending), so they got so upset, :badwords: they went to a "model home" and bought directly from the builder, (never consulting me or letting me know what their experience was).

My broker suggested I get my buyers to sign a buyer/broker agreement...I am not comfortable with them, because as I buyer I refused to sign them, :protest: and found another agent who didn't expect that from me.

What is your experience? Do you use them? Why/Why not? What is your success? Do people walk away when you ask them to sign?

Minna Reid · Answer

I use them for SOME buyers, sometimes. It really depends on the relationship I have with the buyer and how much of my time I am investing. On one level you want the client to stick with you because they find you invaluable, and if they're not happy, well I think they should have the freeedom to walk away.
However on the other side at some point you have to protect your time investment as well.
It's a case by case for me.

Darlene Berkel · Answer

I am still learning as a real estate agent and this is a very good topic. Our office does not use buyer agreements either, so we are exposed to that risk of spending a lot of time with a client that turns out to lead nowhere, since the client may choose to purchase with someone else

They way our office tries to deal with this is by getting exclusive listings, so the buyer would HAVE to buy through us if he really wanted the property and we have agreements with the seller that even if the seller deals directly with the buyer we STILL get paid a fee as the exclusive listing agent. Not all sellers sign this exclusive agreement, but we try to give them incentives to do so.

But for multiple listings, there is always the risk that the buyer might walk away and finalize the deal with another office. So unless its a listing that is exclusive to our office, I tend to limit my time (somewhat) with buyers who are interested in a property that is multi-listed, since there is the risk I may loose the sale to a competitor.

Mary Hanan · Answer

It's interesting SlimJim that you mention two different opinions , because most of the responses I've received are as different as the client/situation. It depends on who you are working with. The first client had told me ahead of time she has worked with many agents who "opened" houses for her. She is an immigrant, and I'm not sure she would have even understood what a broker/buyer agreement is.

The second couple were so young, that they got caught up in the emotions of being "interrogated" by the mortgage broker.

I can see how I could have had a "stronger relationship" with them, where they would have turned to me, instead of "running away". But with only 2-3 times visiting, how do you build such a strong relationship?

Maybe more experience...maybe a good question for a blog?

Eric Wang · Answer

I spoken with 2 broker who has different opinion. Some people have them sign so your time is not wasted like in your situation. Others, if they go with a different agent, that means I didn't do my job in getting to know them and helping them with their needs.

buyer/broker agreement...do you use one with your buyers?

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