Tuesday, February 17, 2009

Using a Buyer's Agent

When you are purchasing a home, near the beginning of the process your Realtor will likely ask if you want him or her to work as a Seller's Agent or a Buyer's Agent. What is the difference?

The state of Wisconsin requires that we as Realtors have a signed contract with one of the parties involved in the sale of home. Unless you are looking at an FSBO, the sellers have a signed contract with the listing agent. With MLS and Wisconsin rules, the Realtor helping the buyer can be considered a subagent of the Seller. It is like building a home. Someone hires a general contractor (the listing agent) who may hire someone else to do parts of the building process (the agent who is helping the buyer). In a case like this, the Realtor who is helping the Buyer is still considered to be working for the Seller and must put the Seller's interests first.

You might prefer to make sure that your Realtor is working only for you. You may want the pricing help and negotiating advice that a Seller's Agent cannot give you. In this case, hire a Buyer's Agent. You and your Realtor will fill out a contract called a Buyer's Agency Agreement. You can determine all the terms on the contract - how long it runs for, what type of properties it covers and more.

One caveat: if you purchases any property covered under the terms on the contract while it is still active, the Realtor may be legally entitled to a commission even if you work with someone else. Do not sign a Buyer's Agency Agreement unless you are certain that this is the Realtor you absolutely want to work with during your home buying process.

Not everyone chooses to work with a Buyer's Agent, but it is much more common than it was twenty years ago. A Buyer's Agent can be your best resource in the home buying process.

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