Magazine

House Hunting? Save by hiring your own Broker 
If you ever doubted the value of real estate agents who work solely for home buyers (as opposed to traditional agents who report to sellers), consider this: A recent study by U.S. Sprint found that 232 relocating Sprint employees who hired buyer's brokers paid an average of 91% of a home's list price. People who use traditional agents typically pay about 96%. On a house originally priced at $150,000, that's a difference of $7,500.  

Personal Finance Magazine

Exclusive buyer's brokers work only with buyers and don't take listings. They're obliged to help you find the best deals and lowest price.  Unfortunately, agency standards have changed so much in the past ten years that real estate agents themselves are likely to be confused about their obligations to buyers and sellers, even though in most places they are supposed to give you a disclosure form explaining your relationship. Bottom line: You don't truly have an advocate in your corner unless you both sign a contract saying so.    

  Magazine  

Do I need a buyer's broker to help me buy a house? 
A new breed of broker, known as an exclusive buyer's agent, acts as your advocate. Like a traditional broker, an exclusive buyer’s agent steers you toward attractive homes and helps you scout out banks or mortgage companies, where you can borrow what you need to make the purchase. Unlike a traditional broker, however, the exclusive buyer’s agent guarantees to protect your interests in negotiations with the seller on the price of the house and any necessary repairs.

A personal shopper for your dream house
A traditional real state broker is legally bound to work for the seller who pays the commission and therefore may be more intent on selling listed homes than finding your dream house. Even Realtors who don't hold the listing on a given house act as subagents to the seller. So unless a broker says that he or she is working for you -- brokers are now legally obliged to disclose who they represent -- you can assume the broker is working for the seller. Such agents must pass on information such as the buyer's income to the seller, who then has a better idea of what price to hold out for.

A conflict of interest is more likely when a real estate firm that represents sellers assigns you one of its brokers as a buyer agent. That's why many people believe an "exclusive" buyer broker is preferable. If there aren't any in your area, and you have to use a listing broker, "make sure they disclose when they are showing you properties they have a financial interest in," says Stephen Brobeck, executive director of the Consumers Federation of America.  

Most agents who show you homes don't represent your interests. They work for the seller, and their object is to sell the house for the highest possible price. 

Buyer Advocacy appears to be taking off. "I'll never buy a house any other way." says Mrs. Renee Talley, Highland Park TX. 

Exclusive agencies are the best. They remove any conflict of interest, which is the main reason for considering a buyer broker in the first place.

  Magazine  

May, 1995 -- "Unlike the traditional agent who looks out for the seller, a buyer broker acts as your advocate, helping you find the home you want, then negotiating the lowest possible price."   

To Buyers: If you want representation, work with a buyer broker. They are legally obligated to represent your interests in any negotiations with sellers, states The Consumer Federation of America.  Groups such as the Consumer Federation of America and AARP recommend using buyer's agents.

Many people don't realize that, unless specifically stated otherwise, brokers are legal representatives of sellers. A buyer broker, representing only the buyer, may be able to secure a better price and better terms.

Buyer brokers: agents that buyers can call their own...If your real estate agent isn't a buyer broker, he works for the seller...Buyers no longer have to fend for themselves. 

Level the playing field when you buy a home...You may get a better deal with your own broker pulling for you...The introduction of buyer brokers takes a horribly one-sided process and simply makes it fair.

Confusion often arises because many buyers believe that the agent who shows them houses works on their behalf. In fact, subagents of the listing broker - often they are agents who work for another office - also act on behalf of the seller.  

Consumer groups strongly endorse the use of buyers brokers to avoid conflicts of interest.

Exclusive Buyers Agents work only for consumers and can often save them money.

"You have a whole new evolution of practice in the marketplace," said Sharon Millet, a Maine real estate broker who headed the 22-member NAR task force that issued the report. Millet said that the report's recommendations are designed to give home buyers and sellers easier access to the "kind of representation" that they want."

When one salesperson has a home listed for sale, and another salesperson working for the same brokerage locates a buyer, the second salesperson can't be a true buyer's agent. Why? Because both people work for the same brokerage. A "dual agency" with both buyer and seller is the usual solution. To solve this problem, a few states are experimenting with laws allowing the agent who finds a buyer for a home listed with the same brokerage to be a fully disclosed buyer's agent for the buyer. This "legal fiction" enables the buyer to work with his own agent who, by law, doesn't also represent the seller." 

All content - copyright © 2002-2004, Relocation Advisors Group Inc.  All rights reserved.