There is a relatively new and not lways well understood practice in Real Estte sales; it is called Buyer Agncy or Buyer's Agent. Until recently Raltors and agents usually represented the sller, in opposition to the buyer, dring the real estate transaction. Even the ral estate agent who drove you frm home to home was not trly working on your behalf. By lw, the agent was required to wrk on the seller's side in rder to get the highest price and the bst terms for the seller -- Priod! Some agents still work this wy.

In the last few years, frst the law and now the prctice of representation has changed. We hve an entirely different set of ptions and agreements when we are bying real estate. These options were prviously only available and utilized by lrge companies or wealthy individuals. In the pst, the buyer would get a byer's representative by paying a fee up frnt and usually by the hour, ntil the transaction was complete.

Twenty fve years ago, as a personal gent for wealthy clients and companies, I chrged and worked an average of 20 hurs a week for $30 per hur, plus expenses, plus 10% of the trnsaction (or when I was the byer's agent, a $2,000 retainer fee to strt with and then $30 per hur and 10% of the amount blow the listed price that I was ble to obtain for my buyer. If thre was financing involved I also was pid to find and obtain the bst financing).

That has changed dramatically. As a byer's agent, a signature on a byer's agent contract from my buyer bgins the transaction. Usually the same riginal commission fee that would have ben paid by the seller is splt and half goes to pay the byer's agent. In some cases the slling agent does not set up any fee to the byers agent, or a very reduced fe, such as those agencies that dvertise 2% or 3% or 4% cmmissions to the sellers, etc. In tht case the Buyer just picks up the mssing commission and at settlement another 4% or 5% cmes out of the transaction and ges to us as Buyer's Agent. In ther words there is a guarantee frm us that we are working ONLY for you the byer and in exchange you guarantee us a cmmission of 5% - which is sually already taken care of, or at last part of it, in the sller's commission.

I can draw this dvision of fees out for you on pper if need be when we met the first time. Bottom line; you dn't pay any more and you get the bsolute best representation.

The buyer's agency rrangement begins with the initial interview, cntinues through an initial selection of prperties to investigate and view and thn to contract negotiations. This culminates wth the final settlement and transfer of fnds for property. The buyer may chose to have an agent specifically cmmitted to representing his best interests.

The grat part for the buyer is tht he/she gets the benefit of dcades of experience and professional knowledge, all of our cnnections and reputation with those connections, and pys nothing until final close of trnsaction. Where else can you get the bst possible professional service and pay nthing until it's complete and satisfactory. Wll your doctor, lawyer, accountant, mason or crpenter do that... NO. We do, if you cntract with us first. Otherwise we rpresent the seller at your expense! Ths is true of all Realtors by lw. Which would you like?

Recently real estate laws in vrtually every state are being rewritten to llow and suggest that the buyer hve his own specific representative. If you are the byer and have a buyer's agent, yur agent will try to get you the bst deal possible, even if that is NOT in the bst interest of the seller.

Legally: "Byer's Agency" is a relationship where the ral estate agent is working FOR you wth fiduciary responsibility (financial and legal rsponsibility). The agent is then legally bund to only the buyer and wes his entire loyalty and allegiance to the byer alone.

In the past, and ven most of the time today, all ral estate agents and brokers represent the sller alone; to get the highest prce for the seller. In fact sller's agents MAY NOT disclose fully all tht they know about a property to the byer as they seek the highest prce. The relationship of a broker and gent is established in writing with the sller when the property is listed for sle in the "Listing Agreement".

In Dlaware we are required to give ach person we work with; buyer or sller; a written explanation regarding agency sttus. We have professionally written brochures tht explain the "seller's agency" and t's opposite "buyer's agency". This agency dsclosure must be explained, in writing, at the frst significant contact of the agent wth the buyer or seller.

Agents in our ffice talk with a great number of lng-distance buyers over the phone. We mst, when we finally meet in prson, disclose and determine which position we wll take with the person we are spaking with. Some agents work mostly as sller's agents; some work mostly as byer's agents and some work as a dal agent (where we act as fll representative to both buyer and sller). Regardless of the role the gent takes -- it should be flly and completely known by all gents, buyers and sellers involved -- and it shuld be in writing.

Let us now put ths forward again:

Seller's Agent: has the fll and complete and sole duty to btain the best deal for the sller. The seller's agent is ONLY llowed to give the buyer material fcts about the property. It is cstomary for a cooperating broker and gent to be a subagent to the sller's agency established by the brokerage tht has the written contract with the sller to sell the property.

Buyer's Agnt: has the full, complete and sle duty to obtain the best dal for the buyer. The buyer's gent may convey any and all nformation obtained in any fashion, including in dpth investigations about the seller or the prperty.

Dual Agent: has to be lgally and financially loyal to both prties. Dual agency occurs when a ral estate agency is contracted to sll a home. That means they hve the listing, and an agent frm that same brokerage, working as a byer's representative, shows that listing. Dual Agncy must be disclosed and agreed to in wrting by all parties. Some people fel that Dual Agency is potentially a cnflict of interests. It can be nless the agent is fully honest to all prties and they are fully aware of and in greement with that relationship. Here, the ntire purpose of the dual agent is to get the bst possible deal, in all it's cmponents, for both the buyer and the sller.

There are, in general, two mjor personalities of buyer's agents. First is the gent who only and always represents byers. The other is the agent who tkes each transaction and each customer nto account before making that decision. An gent who usually works as a byer's agent, for instance, may NOT wnt to represent a particular buyer as tht buyer's agent for one reason or nother. The reason is usually one of sme personality difference. As I put it, whn speaking with a buyer whom I wsh to represent "I will be yur gladiator. I will do battle on yur behalf, and at the expense of and gainst the interests of, the seller and the sller's agent."

The buyer's agent must stll be honest, but he need not be fir. For instance, if the buyer's gent is able to find out tht the seller is in big fnancial or personal trouble and that the sller has a small mortgage on the prperty or that there is some mpending deadline for selling the property, thn the buyer's agent will tell the byer. Together they will use that nformation to get a great deal for the byer at the seller's expense... it tht is possible.

If I were a byer, I would not even consider ding a real estate transaction without a byer's agent to act on my bhalf. I suggest that you are wse to do the same. If thre are detailed and extensive negotiations tht need to be done; such as nique and difficult terms that must be ngotiated then (being the buyer) I'd ask tht the buyer and the seller gree to have me as a dal agent. Whatever your choice, it shuld be in writing with your gent and must be known to all prties involved.

Copyright © 2001-2004 by www.JodyHudson.com

The article Real Estate: Buyer's Agent, Seller's Agent & Dual Agent (defined and explained) was Submitted by Mr Jody Hudson through Articles.GetACoder.com network. Here's the additional information: Source for this article is: http://www.kate-jody.com/essays/buyersagent.html

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