There is no doubt that the remuneration structure of co-operatives, as outlined in , will change. National Association of Realtors The Fee Litigation Settlement Agreement represents a major change in the real estate industry, but it is not the only change mandated by the terms of the agreement.
Under the NAR settlement, agents working with buyers will be required to enter into signed buyer representation agreements beginning in mid-July, pending final court approval of the settlement. Although NAR has repeatedly stated that this is the practice of all agents, It should already be installedmany agents across the country have never used a buyer agency agreement.
But buyer representation agreements are not new to agents in Washington state.
“We are in a very progressive MLS. Northwest MLSSo we’ve made a real effort to pre-empt all of these concerns in our class action lawsuit.” amber bills clarkbroker owner Amber Bills Real Estate Group. “Nationally, buyer-broker agreements have always been encouraged, but Northwest MLS required it and then Washington state started requiring it as well.”
the current January 1, 2024of Washington state. agency law Agents are required to enter into a written agreement with the buyer (as well as the seller) detailing the exact scope of services the agent will provide and the compensation the customer agrees to pay in return.
Bills-Clark said this is exactly how agents already work with sellers, so introducing buyer agreements into the business shouldn’t be a big deal.
“We coached our agents to present it to buyers just like they would a listing agreement,” Bills Clark said. “Before you can list a home, you have to have a listing agreement. It’s really no different than that.”
For this reason, Bills Clark and other real estate professionals across the state feel that buyer agency agreements are a good thing and available to everyone.
“Real estate agents are educating buyers about how real estate works, what transactions and representation are like, and they should have been doing that years ago. The only difference is That means we have to do that now,” said Ken Sachs, designated broker at the Spokane-based brokerage firm. professional real estate services.
“Thank you to the members of Congress, because it makes them better practitioners, better professionals because they have that duty.”
While the contracts themselves are required, the Washington state agency says they come in many shapes and sizes and can be tailored to each customer’s needs.
“The buying process can be a long one, so most say you need a commitment of at least four to six months,” said Amy Breech, a Seattle-based broker at the brokerage. . keller williams-Branded hill team. “However, we also have the ability to limit contracts to specific properties or for a specific number of days, allowing us to meet the specific needs of our clients.”
Based on the language of the law, agents are required to sign a buyer representation agreement before a buyer and seller sign a home sales contract, but the law requires agents to sign the contract “as soon as possible.” I encourage it.
For many agents, this often means having clients sign a contract before taking them on a home visit. This can make things difficult for both the agent and the buyer, as they may not know right away if they are the best fit for each other.
However, Washington state contracts come with the option to make the relationship exclusive or non-exclusive. Real estate experts say this non-exclusive option is especially helpful when meeting and working with new clients.
“It’s like a date,” Sacks says. “So you’re talking to a potential buyer, and the result of that conversation is that you’re going to provide real estate services as defined by law, so you need to sign a contract, but the buyer is not interested in you. You may be hesitant because you only know a lot.” It’s 10 minutes, so I’ll sign a non-exclusive contract. ”
Sachs said if the buyer and agent decide to work together, they can amend the contract to an exclusive arrangement.
Designated intermediaries like Saks are part of a state-wide mechanism responsible for ensuring agents sign buyer representation agreements.
“At the corporate level, we have file reviewers who work off a checklist. They know what to look for, and if they can’t find it, they’ll ask,” Sachs said. “At the state level, licensing departments are addressing this issue by conducting audits.”
Additionally, you cannot pay a commission to an agent unless both the buyer and seller have a buyer brokerage agreement in place, which is executed before the transaction contract is signed.
“Of course everyone has complied, because if you don’t you don’t get paid,” Bills-Clark said.
Washington real estate experts believe that buyer agency agreements benefit both buyers and their agents; Consumer Federation of America (CFA) disagrees.
In a report published in February written by CFA senior fellow Stephen Brobeck, the watchdog group said the contracts contained “unfair clauses” that primarily protect agents and brokers. Consumers were warned that this was possible.
“The industry is given significant freedom in drafting contracts, with real estate agent associations typically drafting the contracts and then giving agents and brokers the power to amend them,” the report said. states. “So while contracts must comply with state laws such as agency and confidentiality, these contracts are written to benefit agents and brokers.”
Although the CFA does not like buyer representation agreements in their current form, Washington state real estate professionals believe that agents should consider buyer representation agreements positive, even if the contracts are modified under the terms of the NAR settlement agreement. I think it should be taken as such.
“I think this gives us a better opportunity to differentiate ourselves from our competitors,” Bills-Clark said. “I see it as an opportunity to not only explain your values, but also explain the home buying process and set expectations for buyers about what to expect and how the process will unfold.
“I feel like it increases the respect and integrity of our team for agents. That’s something we should embrace.”
