What Is a Buyer-Broker Agreement?

What Is A Buyer-Broker Agreement?

Real estate professionals spend a lot of time and energy on a property project. It often takes more than one agent or broker to finally make a deal happen. However, all of this hard work can be in vain if the owner decides to sell on her own or switches to another realtor. 

All of this can be managed and prevented with the help of a buyer-broker agreement, or agent’s representation agreement, as it is called in some corners. It is an example of something many new agents mostly miss, and as a result, they lose a lot of opportunities. 

Here, we will discuss what a buyer-broker agreement is and how realtors can convince their clients to sign one without sounding too demanding:

What Is A Buyer-Broker Agreement?

An agent’s representation agreement guarantees that the agent who signed the agreement will receive the commission upon the sales of the property even if the deal takes place through another agent. It holds the benefits for a buyer’s agents and ensures that a buyer’s agent’s professional activities will be compensated. 

Despite the claim by some veteran agents that such an agreement might poison the realtionship between the client and the agent, this in so many cases protects agents from being victims to disloyal clients and losing commissions, which is basically their main source of income. 

In some states such as Georgia, it is mandatory to sign a BBA and agents may not have the choice to rely on the loyalty of a client. In most other states, it remains an option but still highly recommended.  

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How to Make Clients Sign A Buyer-Broker Agreement?

Signing an agreement that limits the amount of control in the way owners can sell their property is a bit daunting on their part. A seller might be selling for many reasons, and the fate of the deal might as well be very crucial to them at that stage of their lives. So, they will try hard to be involved. he agent can follow these steps to make sure there is a mutual understanding on this subject and everyone wins in the end:

  • Communicate the reasons behind this agreement effectively with your client
  • Explain the significance of this agreement for the client 
  • Educate your client on the legal implications of the agreement
  • Clarify every section of the agreement
  • Convince the client that you are their partner not employee


Bottom Line

Real estate business remains one of the most relationship-based businesses, and the way parties interact might influence their lives and career. As a result, it is very important for both sides to make the terms of partnership clear in advance. The bottom line is that agreements like the BBA will be words before that might avoid dozens of conflicts after. 

For more information about real estate basics and their implications for real estate agents and brokers, please check out the blogs we have put together here:

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The opinions or information expressed in this article are those of the author and do not necessarily reflect the official views, policy, or position of Realtyna. The information on Realtyna’s Website is general, for informational purposes only, and is not to be relied upon or interpreted as real estate, legal, accounting, or other professional advice or a substitute. Please discuss anything related to the certification process, professional advice or legal procedures with your MLS providers.

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