If you're a homebuyer working with an agent who is a REALTOR®, it means you are working with a professional who is ethically obligated to work in your best interest. As of August 17, 2024, you will be asked to sign a written buyer agreement after you've chosen the professional you want to work with. Here's what you should know about these agreements:
What is a "written buyer agreement?" What does it do?
A written buyer agreement is an agreement between you and your real estate professional outlining the services your real estate professional will provide and the fee they will be paid for those services.
Why am I being asked to sign an agreement?
Written buyer agreements became a nationwide requirement for many real estate professionals as a part of the National Association of REALTORS®’'proposed settlement of litigation related to broker commissions. The requirement went into effect on August 17, 2024.
Are these agreements new?
In some places, yes. Many states have required them for years, while some have not. As a result, it is entirely possible you or others you know have not used them recently. Regardless, they are now a nationwide requirement for many real estate professionals.
Are these agreements negotiable?
Yes! You should feel empowered to negotiate any aspect of the agreement with your real estate professional, such as the services you want to receive, the length of the contract, and the compensation, if any. Compensation between you and your real estate professional is negotiable and not set by law. In the written agreement, the compensation must be clearly defined (e.g., $0, X flat fee, X percent, X hourly rate)—and not open-ended or a range. Only sign an agreement that reflects what you have agreed to with your real estate professional.
How do I benefit from these agreements?
These agreements outline what services you (as a homebuyer) expect your real estate professional to provide and what your real estate professional will pay. These agreements clarify things and reduce potential confusion at the outset of your relationship with your real estate professional.
When do I need to sign an agreement?
You will be asked to enter a written buyer agreement with your real estate professional before touring home with them, either in-person or virtually. If you are visiting an open house or asking a real estate professional about their services, you do not need to sign a written buyer agreement.
Does this mean I must pay my real estate professional out of pocket?
Not necessarily. While you are responsible for paying your real estate professional as outlined by your agreement, you can still request, negotiate for, and receive compensation for your real estate professional from the seller or their agent.
Do agreements dictate a specific type of relationship I need to have with my real estate professional?
No—you can enter into any business relationship with your real estate professional, as allowed by state law where you live.
Can I change or exit an agreement?
Yes. You and your real estate professional can mutually agree to change your agreement. Agreements may have specific conditions under which they can be exited, so read the agreement and speak with your real estate professional if you would like to change or exit your agreement.
Practices may vary based on state and local law. Consult your real estate professional and an attorney for details about state law where you purchase a home. Please visit facts. realtor for more information and resources.
