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A Buyer Representation Agreement, or Buyer Agency Agreement, establishes the agency relationship between a buyer or buyers and their Designated Agent and spells out the terms of this relationship in writing.

According to the Louisiana Real Estate Commission, Designated Agency is defined as the relationship that is presumed to exist when a licensed real estate agent engaged in any real estate transaction works with a client unless there is a written agreement providing for a different relationship. This means that whatever real estate agent you are working with directly during your home search are legally considered your designated agent. This should be the only agent you discuss the details of your finances, negotiations, and any other confidential information with.

Some buyers choose not to commit to working with a Designated Buyer’s Agent and prefer instead to reach out to multiple agents across brokerages somehow believing that this will give them access to more properties. However, this is not generally the case since all Realtors have access to the same listings via the MLS. While there is nothing legally stopping a buyer from doing this, this practice is unfair to the agents when they are unaware of what the buyer is doing. Also, this can cause legal issues for the agents/brokers involved when more than one agent believes they are the one who introduced you to a particular property (known as procuring cause) and everyone could end up in litigation.

Our company just doesn’t do business like that. We choose to ask that our clients sign a Buyer Representation Agreement to affirm that our agent is their only Designated Agent. The contract terms specify the length of this agency relationship, the properties that are covered under the agreement, the amount of commission that will be paid, and who is responsible to pay it. The services provided by your Designated Agent are outlined in the document as well. Typically, the buyer receives these services at no cost because their agent’s commission is covered by the offer of compensation to the cooperating broker in the MLS. Occasionally, there may be certain circumstances where the buyer would pay the commission directly, such as a For Sale By Owner with no offer of compensation from the seller, but this will always be disclosed by the agent in the Buyer Representation Agreement as well as verbally during the Buyer Consultation.

Should a buyer choose not to sign the Buyer Representation Agreement, our agent may choose not to work with them on their purchase. While it is not a legal requirement to have a Buyer Agreement in place, refusal to sign one would be an indication that the consumer does not want to have a Designated Agent and as such our agent may feel uncomfortable acting in that capacity. The terms of a Buyer Agreement are always 100% negotiable, so we should always be able to find terms that are mutually agreeable to all.    

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