What is this Buyer Agreement thing?

If you are used to calling up an agent at random to see a home you found online you may now have to jump through one extra hoop.  Unless you are calling up the listing agent directly, a buyer agent may now require  a written agreement in order to show you the home. Prior to mid-2012 it wasn’t so – you could call up an agent and ask to see a home – and in many cases that agent would be ok with taking you to a home hoping that you would use him/her to make an offer if you liked the home.

On July 1, 2012 a new Virginia law went into effect that required an agent and a buyer that has agreed to work together to solidify that relationship in writing as soon as any substantial advice is given. The aim is to clarify the obligations of each party to the transaction and must include a list of services the agent will deliver, compensation terms and a definite end date.

Customers do not have to use an agent – they can still call up the listing agent of a property directly to see and make an offer on the home. They could then proceed as an unrepresented purchaser (usually a bad idea) or use the listing agent in a dual agency capacity (an even worse idea…)

The Virginia Association of Realtors had specific reasons for supporting and asking for the new law:

• It informs the consumer. The law is to make sure consumers are fully informed about the real estate services they’ll receive and the nature of the relationship with the licensee.
• It mitigates REALTOR® liability. The law is designed to protect licensees by making sure full disclosure is provided and the nature of brokerage relationship is reduced to writing. It’s to eliminate much of the consumer confusion that can come back and bite the licensee.
• It discourages opportunistic dual agency. The law is intended to make sure that licensees who practice dual agency are fully informing consumers about the risky nature of that relationship.

So, does this mean that you have to “commit” to an agent before really knowing him/her?  While practices vary from firm to firm, at Soldsense we are perfectly comfortable with doing an initial showing with a 1-day listing agreement so we get to know each other.

As soon as we start discussing specifics (strategies for an offer, investment property advice and so on) we will want a buyer agreement signed to make sure both parties are committed to the process.