A Buyer Agency Agreement is Not a Legal Requirement in Colorado Springs Real EstateStatistics show that more than 90% of prospective home Buyers surf the internet to look at homes before they contact a Realtor. When someone contacts a Real Estate Professional, we will often look at houses with them to understand what they are looking for. Many Buyers believe that when they work with a Realtor to find their new home, that the Agent gets paid for showing them houses. That is not at all the case.
Many Real Estate Agents will require you to sign a Buyer Agency Agreement with them before they will show you even one house. In the State of Colorado, that is not legally required, and we do not recommend that you do that prior to a first showing, especially if this is an Agent with whom you do not have an established personal or professional prior relationship.
Although Colorado laws govern the transaction, every Realtor has their own way of identifying and showing properties, interacting with Clients ~ it is as individual as there are personalities. So what happens if you get to the end of the first day with this new Agent with whom you have signed a binding agreement, and you find that you do not mesh well, or that you don’t like the way they do business, or that none of the homes they have shown you meet your needs?
My opinion is that it is necessary to work with someone a few times to make sure they are someone with whom you interact well, someone that you respect, someone who understands your needs. Then you can determine if that Agent is someone with whom you would like to enter into a binding working relationship.
After you have established that foundation, then it is in your best interests, and protects you, the Buyer, to consider ‘settling down’ and committing to a relationship. Interestingly enough, when you commit, your Realtor is then committed to you. When you sign a Buyer Agency Agreement with your Realtor, you then become a Client and not merely a Customer. And the scope of that is not just about showing you houses.
Even in the house-showing phase, there is extensive MLS investigation, computer searches, and phone calls to other Agents to “narrow the field” so we are not wasting your time looking at homes that don’t fit your needs. But if you are a savvy surfer, these are things that you can, with some time investment, accomplish yourself.
We can show you one house, we can show you a hundred homes (we sincerely would rather not). We can work with you one day before we write an offer for you to purchase a home, or we can work with you for months. Our job really begins when you identify the home that you would like to pursue.
A good Realtor will make sure you have been pre-qualified for a loan before you ever start looking, so when you are ready to begin the process of purchasing, we are ready to hit the ground running. We will present and negotiate offers, keep track of deadlines, follow inspections and appraisals, walk (trudge) through the loan approval process, secure Title Commitments, and hundreds of other details to make a smooth transaction.
One of the most important aspects of entering a binding relationship is that, as a Client, we can fully negotiate (advocate) on your behalf, something that we cannot do if you are merely a Customer. To be in that position, we must sign a Buyer Agency Agreement. This Agreement is an instrument that protects YOUR interests, and is not something of which you should be afraid.
In that Buyer Agency Agreement, the following points, among others, will be addressed:
- A general description of the type of property for which you are looking
- How long the Buyer Agency Agreement will be in effect
- What duties and responsibilities your Agent will perform
- What information we will NOT share without your informed consent
- What our legal relationship to you as a Client entails
- How your Agent will be financially compensated (generally NOT by YOU)
- You acknowledge that you are not the Client of another Realtor
- Acknowledge that we will not unlawfully discriminate against any Seller
- Inform you that you have the right to legal and tax counsel
- That the State of Colorado governs the laws of the Contract
- Enumerate any provisions that might be unique to our relationship
- That you have a right to contact local officials about possible sex offenders in the area of any home that you are considering purchasing
So make sure you have the facts before signing a Buyer Agency Agreement. Feel free to call Mimi Foster, with absolutely no obligation, and I will be happy to answer questions you might have about this process.