What is a Buyer’s Agent?

Buying or selling a home / real estate is a complicated  and ever-changing process. According to the 2023 National Association of REALTORS® Profile of Home Buyers and Sellers, 89% of buyers purchased their home through a real estate agent or broker. Most people use an agent but may understand how agency relationships function. Most home buyers do not realize that you can choose your own buyer’s agent, if you want one and how much your choice of representation will enhance the ease of your purchase.

So…Why Would Do You Want One?

You want someone on your side to walk you through the transaction. It’s a sometimes confusing process and your agent can guide you through it all.  Having a buyer’s agent is like having a real estate fairy godmother. A buyer’s agent represents a buyer, just like the listing agent represents the home seller. It is just in recent years that the laws have changed—previously, all the agents involved in a transaction represented the seller. Luckily, now Buyers can have equal representation when buying real estate. The relationship is created through a Buyer Representation Agreement and is sort of like “going steady” during your purchase—you both make a commitment to work with one another. Your agent will hold your hand throughout the process and make sure that everything is proceeding along towards closing. It is optional to hire a buyer’s agent, but you should highly consider it in one of the biggest financial transaction sof your life. Update:  As of August 17,2024, Realtor® members are required to have a signed Buyer Representation Agreement before showing any homes.

What’s the Catch?

You must decide what is best for you. In most cases, it is in the buyer’s best interest to have a rep. The buyer’s agent is bound by contract to advocate for the best interests of the buyer. What is the cost? It’s negotiable.  Buyer’s agent fees are determined by the individual brokerage and fees are not fixed and are negotiable.

How to pay for an agent?

There are multiple ways for a buyer’s agent to get paid in a transaction.  Compensation structures are not standardized and are negotiable, so it depends on your agreement with your agent. In many cases of properties listed on the MLS, the buyer’s agent is paid by the listing agent (through a “co-op” fee) or via seller buyer agent compensation offer.  UPDATE: As of August 17, 2024, offers of buyer agent compensation are no longer allowed to be advertised via MLS, so your agent will find out in advance if your buyer agent fee will be covered before touring each property.  The buyer’s agent is bound by contract to advocate for the best interests of the buyer (YOU) only! There are times when the buyer must pay out of pocket for representation—typically if the buyer is purchasing a “For Sale By Owner” property or if the listing does not offer buyer agent compensation.  If there is an out of pocket commission on your purchase, fee schedules/options will be discussed well in advance, so there will be no surprises.

It’s simple, really—the most important reason to have a representative is that someone is looking out for YOUR best interests in the transaction. There are many factors that go into successful negotiations and sometimes a bump or two in the road to closing. A good buyer’s agent can save you thousands and give you numerous tips and tricks that will make the process much smoother and the benefits will stretch out well beyond closing day.

Have more questions? Call us or check out our FAQ on buyer representation HERE.

Lisa E. Priest loves a well-written contract and is an East Texas Area REALTOR® with Picket Fence Realty, Inc. You can reach her via phone or text at 903-948-3343 or read more at BuyPalestine.com.