LOVELAND – When purchasing a home in Colorado, you have the option of working with a buyer’s agent. Your agent will work on your behalf and has certain legal responsibilities. If you’re a first time buyer, these buyer agency FAQs may help you better understand this option.
What are a buyer agent’s legal responsibilities?
Buyer agents owe you a fiduciary, which includes confidentiality, care, obedience, accounting, diligence, and disclosure. The buyer agency form outlines specific tasks and responsibilities for both you and your agent.
Why is there exclusivity?
Real estate agents have time to service a limited number of clients and they get paid only on commission. Your agent will spend time working with you, showing homes, answering questions, providing valuable advice and guidance, etc., which can be very time consuming. Naturally, he/she will want some type of commitment from you.
Do I need a different agent for each town?
Most real estate agents service multiple communities in the area, so you can work with just one agent for your home search. However, in cases where your search area is unusually wide, you may end up needing to connect with more than 1 agent. Buyer agency agreements are location-specific, so you can have more than one buyer agent if each covers a different area.
Who pays the buyer agent’s commission?
In most cases, the listing agency for a home will offer co-broke compensation to any buyer agent who procures a ready, willing, and able buyer. Essentially, the seller pays their listing agent and that agent splits the commission with the buyer agent. Be sure to ask your buyer agent what should occur if the co-broke commission is less than the amount listed in your buyer agency agreement.
Is there a time limit to buyer agency relationships?
Yes, all buyer agency agreements have a start and end date. Should the date lapse, you may extend it further.
Do I need a buyer’s agent?
Technically, no. However, there are many benefits to working with a buyer agent. Listing agents work on behalf of the seller. Although they must treat you honestly and fairly, they must put the seller’s best interests first. Given that buying a home is one of the biggest investments that you will make in your lifetime, it seems only fitting that you should have someone looking out for your best interests. That would be your buyer’s agent!
Can my buyer agent assist me with for-sale-by-owner properties?
Yes, your buyer agent can assist with properties not listed in the MLS system. Your agent will need to approach these properties slightly differently. Ask your agent for more information on this.
Do I need a lawyer if I have a buyer’s agent?
Real estate agents are not allowed to practice law. They will provide you with valuable guidance during the home buying process, but they cannot give you legal advice on contracts and other specific legal matters. You have the right to hire an attorney for your Colorado home purchase.
Can my buyer agent refer me to an attorney, home inspector, and other service providers?
Yes, agents can provide you with a list of service providers that they recommend. It is important that you perform your due diligence to determine which best fits your needs.
What should I do if I have additional questions about buyer agency?
Contact a real estate agent. They can discuss your options as a buyer and answer all of your questions about buyer agency, the Colorado market, and other real estate related topics.
By Suzanne Plewes, RE/MAX Alliance in Loveland. Suzanne Plewes is a broker associate at RE/MAX Alliance. Write to 750 W. Eisenhower Blvd., Loveland, CO 80537, call 970.290.0373 or e-mail firstname.lastname@example.org.