| 2. Selecting A Real Estate Agent Introduction
Agency Disclosure Forms
Understanding Real Estate Agency
The Buyers (Selling) Agent
The Listing (Sellers) Agent
The Transaction Broker (Buyer and Seller)
Understanding How Agents Get Paid Introduction
Beware of an agent that just takes you out looking at homes without pre-qualifying you to determine the price range that fits your budget and one that doesn’t interview you to determine your requirements. All real estate agents have access to the MLS and can show you any home you see advertised by another real estate agent. You will not get a better deal calling the listing or advertising agent, in fact you may end up paying more. Also when you call a listing agent or a large real estate office they will start by showing you in house listings first rather than the homes that meet your criteria. Many buyers choose a real estate agent by accident. They’ll walk into an open house and fall into working with the agent at the open house. Choose an experienced full time agent who will diligently protect your interests, especially in a tough negotiation. Your comfort level is important since you will probably spend a significant amount of time with your agent. You’ll want an agent that understands your needs and desires and promptly returns phone calls or e-mails to answer your questions day or night. Can you talk directly with your agent or do you only get an assistant? Finally, you want an agent who knows the area in detail, and has already previewed many of the homes available for sale in that community. Buying a home is one of the most significant transactions of your life so don’t leave it to chance. More often than not, the keyword in the real estate industry is "sell" rather than "represent". Far too many brokers and agents appear to have an undeclared mission statement that reflects "salesmanship" rather than "representation" of Buyer or Seller. First and foremost, ethically and legally, a real estate agent should be continuously aware of his or her responsibility to the client. Agency Disclosure Forms
These disclosure forms should be discussed and signed at the first substantive meeting with your agent. The forms specify the different types of agency and what your agent's duties to you are. Have your agent discuss these forms with you so you're clear what type of agency and representation is best for your situation. Understanding Real Estate Agency
On the surface all real estate agents seem alike. They all charge similar fees and provide similar services. However picking the wrong agent can cost you thousands. Most buyers don't understand the difference between a listing agent, a buyers agent, a transaction broker or who represents whom in a transaction. A Single Agent represents either the buyer or seller but not both parties. A Transaction Broker represents both parties in a limited fashion. The Buyers (Selling) Agent
The buyer's agent represents the buyer exclusively. He or she has a responsibility to represent the buyer and look out for their interests. Most people hate being fooled or given inadequate information. They want to be presented all the available information at the outset so they can make an informed decision. Under these circumstances most people are willing to accept responsibility for the events that follow. What they don't like is not being informed about something that would have made a difference in how they saw things and how they approached the decision-making process. A buyer’s agent can secure all the information available about a property and share it with you so that you can make informed intelligent decisions about the most important investment in your life. If you decide to use us to help you find your next home we will ask you to sign the relevant agency disclosures and the Exclusive Buyer Broker Agreement which is in effect an employment agreement in which the responsibilities of the parties are set out, and in which you agree to exclusively work with a buyer's agent/broker for an agreed period of time, and in which you agree to pay a commission in the event a listing broker or owner does not agree to compensate your buyer's broker. Signing this agreement does obligate you to work solely with one agent, though there may be a geographic limitation. The Listing (Seller’s) Agent
The listing agent is the seller's agent exclusively. He or she has a responsibility to represent the seller and look out for the seller's interests. The listing agent almost always has a written agreement called a listing contract that specifies among other things, the price, commission amount, and the authorization to put the property in the MLS, split the commission with the selling broker, and put a yard sign in front of the property. The listing agent will share any and all available information about any buyers with the sellers. Information such as the buyers motivation, how much they are willing pay, etc. The Transaction Broker (Buyer and Seller)
There are times when a real estate agent will represent both the buyer and seller in a transaction. This happens when a buyer who is not represented by a buyer’s agent calls on a sign, ad, or Internet listing. The listing agent will show their property listing to the buyer. If the buyer decides to write an offer for the home without employing their own agent they will ask the listing agent write the offer. Before writing the offer, the listing agent has the buyer and seller sign the Transaction Broker Notice which discloses that the agent will not work to represent one party to the detriment of the other party when acting as a transaction broker to both parties. This is perfectly legal but not always in the best interest of the buyer. When you make an offer to buy a house, you are entering a negotiation. The seller wants as high a price as possible and the buyer wants the lowest price possible. If a Realtor represents both sides, there is a conflict of interest, though an ethical Realtor can equally represent both sides. Most Realtors are very ethical and take their responsibilities seriously. However, If the listing Realtor knows how much you are willing to pay for a home or the loan amount you have been qualified for, and that information somehow gets passed on to the seller even though they are also representing you as the homebuyer, you are at a disadvantage. You won’t be in this position, wondering if you’re getting a good deal, if you hire your own agent to protect your interests. Understanding How Agents Get Paid
Many buyers don't understand how their agent is paid. Some think the buyer has to pay a fee for representation. Here's how it works: When a seller lists a property for sale, the listing agreement includes a commission clause that stipulates how much commission the seller will pay. It's usually a percentage of the final selling price, let's say six percent. Typically that 6% commission will be split between the buyers agent and the listing agent at the close. The listing broker lists the home in the MLS notifying all the other brokers that the commission split is 3% to the selling broker. However, in certain situations the buyer pays a commission. For example, the buyer may want to buy an unlisted home from a private party. The buyer can hire an agent to write the contract and pay him direct. But generally with most listed MLS properties the seller will pay the entire commission. | 
