The Best Choice For Homebuyers
For most homebuyers, purchasing a home is the most significant and complex financial endeavor they may ever undertake. But by choosing a REALTOR with an ABR designation, they’ll have more confidence in their buying experience, as they’ll be working with an agent who goes the extra mile. An ABR doesn’t just signal an agent’s robust real estate knowledge but also their best-in-class service.
Specialized training
Established track record
Proven experience
DESCRIPTIONS OF AGENCY
There are agents, and then there are agents. Yes, it sounds confusing. That’s because the term “agent” is often used casually, referring to any real estate practitioner. But an agent also refers to someone with whom you’ve established a formal agency relationship—someone who represents your best interests in a real estate transaction and owes you fiduciary responsibilities. Agency relationships are usually established in writing with buyer agency agreements, and require the following from your agent:
- loyalty
- obedience
- disclosure
- confidentiality
- reasonable care and diligence
- accounting
THE BIRTH OF BUYER AGENCY
For many years, real estate was practiced in a manner that extended agency relationships only to sellers. Any agent who brought a buyer to the table was actually working as a sub-agent to the seller.
This all began changing in the 1980s, when buyer agency started gaining momentum in residential transactions. Today, you can’t assume that you will automatically receive full fiduciary responsibilities from the agent you’re working with as a potential home buyer without a Buyer’s Agency Agreement.
That’s why it’s vitally important to talk to the agent or broker early in your working relationship about his/her agency status.
This table outlines how your status may affect the level of service to which you are entitled:
| Are you a buyer-customer or a buyer-client? Services will vary depending on your agency status* |
|
| If you are a CUSTOMER (no agency relationship), an agent will: | If you are a CLIENT (agency relationship), your agent will: |
| Maintain loyalty to the seller’s needs | Pay full attention to your needs |
| Tell the seller all that they know about you | Tell you all that they know about the seller |
| Keep information about the seller confidential | Keep information about you confidential |
| Focus on the seller’s property | Focus on choices that satisfy your needs |
| Provide just the material facts | Provide material facts as well as professional advice |
| Only provide price information that supports the seller’s listing price | Provide price counseling based on comparable properties and their professional insights |
| Protect the seller | Protect and guide you |
| Negotiate on behalf of the seller | Negotiate on your behalf |
| Attempt to solve problems to the seller’s advantage and satisfaction | Attempt to solve problems to your advantage and satisfaction |
* This chart is for general illustration purposes only. Agency laws vary by state, and specific terms of individual agency contracts will vary from one agent to another.
YOU MAY NOT KNOW IF YOU’RE A CUSTOMER OR A CLIENT.
Depending on the laws in your state, you may find yourself working with someone who is actually negotiating for the seller, not you the buyer. The best way to be certain your interests are being considered and protected is to sign a buyer agency agreement with a trained buyer’s rep, which clearly establishes client-level services and spells out what services you can depend upon.
WHAT ABOUT DUAL AGENCY?
In some cases, it will become necessary for your real estate professional to deviate from the single-agency model. For example, a buyer-client may become interested in a house that also happens to be offered for sale by a seller-client of their buyer’s rep, or by the same brokerage firm. How can a buyer’s rep, in this instance, maintain complete loyalty to their buyer if he or she also owes complete loyalty to the seller?
Obviously, they can’t. But, depending on the real estate license laws , and your status with the brokerage firm, the manner in which this situation is handled will vary. If your agent hasn’t supplied a disclosure statement, you should ask for it. It spells out the different categories of agency services they provide and how they address dual agency.
Almost all states require disclosure of dual agency and often require that a buyer’s rep (or his or her brokerage firm) only act as a dual agent with the written consent of all parties to the transaction. In such a situation, the brokerage agrees to endeavor to be impartial between both parties and will not represent the interest of either party to the exclusion or detriment of the other party. Neither will they share the confidential information of one party with the other party. This is how brokerage firms and their agents strive to create win-win situations for everyone involved.
Even though the laws concerning agency can vary from one state to another, one thing that is constant throughout the U.S. is the obligation for all REALTORS® to comply with the National Association of REALTORS® Code of Ethics.
ABR® VS BUYER’S REP
A buyer’s representative (or simply buyer’s rep) is a licensed real estate professional who represents prospective home buyers in their property transactions.
If you’ve formalized an agency relationship, typically by signing a buyer’s rep agreement with a buyer’s rep, you can expect him or her to:
- Understand your specific needs and wants, and locate appropriate properties.
- Introduce you to a trusted lender that can assist you in determining how much you can afford (pre-qualify your mortgage).
- Preview and/or accompany you in viewing properties.
- Research properties to identify any problems or issues you should consider.
- Advise you in formulating your offer.
- Help you develop your negotiation strategy.
- Provide a list of potential qualified vendors (such as inspectors, attorneys, lenders, etc.) for other related services that may be needed.
- Keep track of all the details throughout the entire transaction—to closing and beyond.
In other words, a buyer’s rep should make your home-buying experience as smooth and successful as possible. But not all buyer’s reps are equal. A buyer’s rep who has earned the Accredited Buyer’s Representative (ABR®) designation has made an extra effort to raise the bar with additional training and experience in serving you, the homebuyer. If you work with an ABR®, you can feel more confident that you’ll receive the highest level of buyer-representation services.
