Benefits Of An Exclusive Buyer Agency
The only thing worse than paying too much for a property is buying the wrong property. Buyer’s Resource can help you avoid both of these problem situations!
The Client Relationship
As a client, not just a customer, you should expect to relate to your agent in complete confidence and trust. When you are a client, your Exclusive Buyer’s Agent (EBA) has the same fiduciary duty to you that an attorney has with their client. Communication should be open and honest – nothing you say to your EBA will be disclosed to anyone unless you specifically authorize it. In turn, you should expect your EBA to be open and honest with you in discussing the relative merits or disadvantages of a particular property, or guiding you to more realistic expectations.
When sellers engage the services of a broker to list their property, they sign a listing agreement defining the services and responsibilities of each party. As a buyer retains the services of an EBA, each party would want the same. Required by Colorado Real Estate Law, the Buyer Agency Agreement includes details such as the type of property, the price range, location, the term of the agreement, the fee involved, and when and how the agent’s fee is to be paid. You should feel free to negotiate any of these terms with the agent before signing. It’s always best for both parties when all the specifics are agreed to in writing.
Exclusive agency works both ways. Just as an EBA will owe an exclusive duty to you as a client, you will be expected to work exclusively with the EBA during the term of the agreement. Since your EBA will be investing his or her livelihood and time to help you make the best purchase on the best terms, your loyalty will enable him or her to do a much better, more thorough and professional search for you.
Counseling, Not Salesmanship
The essence of the relationship between a buyer and an EBA is one of partnership as you work together in mutual confidence to meet your lifestyle goals. As a client, you will not be subjected to high-pressure sales techniques. The professional EBA will act as guide and counselor, providing all the appropriate facts necessary for you to make an intelligent and informed decision. Let us know if you are ready to make an offer when the right property comes along, or if you are just wanting to get to know the market. It’s your call!
During your initial interview, you must feel free to raise any questions or to discuss anything, including the fee, about which you may be uncomfortable. Success depends on mutual trust and openness. Your EBA wants that as much as you do before investing his livelihood in you as a client.
Getting the "Best Deal"
Working with an EBA doesn’t mean you’ve hired a "Gunslinger" to shoot down the price or steal a property for you. However, your EBA’s goal will be to obtain a fair price on financial terms that are favorable to you, using his/her expertise and experience to help you avoid paying too much for a property that is overpriced. Remember, your EBA represents you, not the seller, so his/her job is to get the lowest price and best terms for you.
Freedom to Look at Other Properties
Most of the time your EBA will accompany you. When you are on your own, there is a specific procedure to follow if you want to visit open houses, or to contact an owner who is selling by himself. Always discuss this with your EBA first, as many agents and home sellers are not familiar with exclusive buyer representation so you must follow your EBA’s instructions very carefully.
Usually your EBA will call ahead to make arrangements with the owner or his agent before you go to see the property, just to be sure that there is no misunderstanding about your being exclusively represented. One of the nice features of working with an exclusive buyer’s agent is that all properties, not just those being marketed on the Multiple Listing Service can be considered. This also includes auction, for-sale-by-owner and bank owned properties.
Peace of Mind
An exclusive buyer’s agent can’t promise to do the impossible – just to do his or her best to get you the property of your choice, at the best price and on the best possible terms for you.
Peace of mind comes from knowing that your EBA will place all the facts and information he or she can at your disposal, and verify the information provided by the seller and his agent in an objective manner. The EBA is there to give professional guidance and counsel, not to "puff" the property, or to subject you to high-pressure sales techniques. Furthermore, once you have the property under contract, you will have an extra set of eyes looking out for your best interests throughout the due diligence period.
A Difference of Degree
Every broker and agent has an obligation to provide you with facts and to treat you fairly and honestly. An Exclusive Buyer’s Agent, however, can go further than this and assist you to verify, interpret and evaluate facts about the property, and give you counsel and guidance as you make your decision.
A seller’s agent must only tell you that the roof leaks – an Exclusive Buyer’s Agent can legitimately negotiate to get the seller to fix it and pass a warranty on to you. A seller’s agent must only disclose that there is a state highway right-of-way just beyond the property line – an EBA should help you find out what the plans are and help you to evaluate any future impact of the road construction.
Don’t expect miracles from an EBA. However, you can expect due care to guard your interests through all aspects of your purchase from search through settlement. The result should be greater satisfaction for both of you. Freed from divided loyalties, your buyer’s agent will be able to give you the protection a professional owes his client.
How Your Exclusive Buyer’s Agent is Compensated
Buyer’s Resource Real Estate of Steamboat and all of its agents are members of the Steamboat Springs Board of REALTORS and Multiple Listing Service. With this membership all participants have not only agreed to cooperate in sharing the information on all of the properties listed, but also the commission. Each MLS listing has a cooperative commission that is available to your Exclusive Buyer’s Broker. So, with all MLS properties, as a buyer who uses an EBA, you will have a professional broker at your side at all times looking out for your best interest and helping you negotiate the lowest price and best terms, and it won’t cost you one extra penny!
There may be some situations (i.e. for-sale-by-owner) when the price does not include a cooperating brokerage fee. In these cases the asking price for the property needs to be considered in terms of the buyer paying the brokerage fee out of pocket or adding it to the purchase price.
Will Buyer’s Resource Truly Get Me the Best Price?
It is fair to think that because the income brokers make is determined from a percentage of the sales price, and the higher the sales price the higher the broker’s income, that even an EBA would want to see a higher, rather than lower, purchase price. However, your EBA has signed an agreement with you to protect your interests and help you negotiate the best deal possible.
From a practical standpoint, if a Buyer’s Resource agent was able to save you an additional $20,000 on a purchase and there was a 3% commission available, that $20,000 savings for you would amount to an additional $600 in commission. That amount is not worth the reputation we have built in the Steamboat market since 2000. Furthermore, we want our clients to continue to come back and use our services again, along with referring our services to friends, relatives and associates. The reward for repeat business and referrals, combined with knowing we provided a great service to our clients, is much more valuable to us than 3% of anything. Our integrity will not be compromised, and a list of past clients and their contact information is available upon request.