The real estate market is hot right now with pent-up buyer demand from 2020. According to the National Association of Realtors, the inventory of available homes on the market set a record at the end of 2020 as being the lowest since 1999. Interest rates are still historically low and, in many areas, when a home is listed for sale, it's a race as to who sees it and puts in an offer first. Many homes receive multiple offers within a couple days of going on the market with buyers often paying more than list price for homes. Home values are rising and many real estate brokers are working overtime trying to find their buyers homes. They work extra hard for the buyers they have an Exclusive Buyer Broker Agreement with.
Exclusive Buyer Broker Services
A buyer's broker has a fiduciary responsibility to his clients. He must have your best interests at heart, above his own. He should provide you with the following services:
* Explain the home buying process, step by step.
* Help get you pre-approved for a mortgage.
* Set up a search in the multiple listing service to email you listings when they come on the market.
* Show you properties, in your price range, that meet your needs.
* Show you the properties that become available in a timely manner.
* Explain documents such as contracts and disclosures.
* Do an analysis to make sure the home values are in line with the current list prices of the homes you're seeing, so you don't pay more than a home is worth.
* Help you write and submit an offer once you find a home you'd like to buy.
* Help you arrange inspections.
* Monitor contingency dates.
* Support you through the entire transaction and on closing day.
Exclusive Buyer Broker Agreement
According to Homelight.com, an exclusive buyer broker agreement outlines the scope of the work the real estate broker will give you. It's a contract with terms that both you and your buyer's broker must fulfill. Listings and information are readily available on the internet for buyers to do their own home searches. However, an exclusive buyer broker must work more diligently for his buyers, so it's better to have this relationship in writing. The contract will include:
* Buyers Names
* Brokerage Name
* Designated Broker's Name
* List Duties
* Specify Amount of Commission Due and When
* Beginning and End Date of Agreement
* List Area or Towns
* Property Description
* Signatures of All Parties
It's important to note that while there is a place to specify commission due to the buyer's brokerage on the agreement, the seller's brokerage typically pays the buyer's brokerage the commission. This will only come into play if the amount being received from the seller's brokerage is less than the agreed-upon commission amount in the contract. Then the buyers will have to pay the difference.
The OLDCAR Acronym
A buyer broker is required to practice fiduciary duties for his buyer. These include:
* Obedience- a buyer broker must obey all lawful instructions from his buyer.
* Loyalty- a buyer broker must act in the buyer's best interests, above his own.
* Disclosure- a buyer broker is obligated to disclose all relevant material information he knows.
* Confidentiality- a buyer broker must keep all information he knows about his buyer confidential.
* Accounting- a buyer broker must account for all money or property belonging to his buyer.
* Reasonable Care and Diligence- a buyer broker must use reasonable care and diligence when dealing with his buyer's affairs.
Having an exclusive buyer broker is truly in your best interest, especially in this seller's market. You will be in better hands if you develop a relationship with one who will work hard for you.