There’s nothing more frustrating than spending a lot of time showing homes to a buyer, only to have them decide it’s not time for them to make a move right now.
Wait – yes there is. There most certainly is.
It’s even more frustrating when you spend time showing a buyer a bunch of properties, and then they DO buy – with someone else.
That’s why you need to protect yourself with a buyer’s agreement.
Protection Through a Buyer’s Agreement
A buyer’s agreement protects you, but it also protects a buyer by listing clear expectations from each party.
A seller generally has an agent protecting them and representing their interests. A buyer needs the same thing – not just to show a home, but to walk them through the buying process, negotiate on their behalf, and connect them to the professionals that can help finalize a deal.
As a Realtor®, you can’t afford to provide these services for free. Your time is valuable, and you don’t want to spend dozens of hours with someone only to have them make an offer through their cousin, or aunt, or some other random person.
It’s not in a buyer’s best interest to represent themselves, especially with a builder or FSBO. They simply don’t have the leverage to make the deal work out in their benefit, and are likely to be taken advantage of.
Talking to a Buyer About Representation
A lot of agents are afraid to require a buyer’s agreement because they think it will scare off the buyer. In fact, there are a lot of websites that unfortunately advise a buyer to avoid getting “locked in” to something that they may not want.
You can help your buyer understand the idea, however, by focusing on how it’s a benefit to them. Explain that you have the expertise to walk them through every stage of the process and that they are at risk if they try to negotiate alone.
Also, let them know that if they aren’t happy with working with you, they can terminate the buyer’s agreement. Create a notice window – perhaps two weeks – and make sure that any home you’ve already shown will still result in you getting a commission if they buy it.
At the same time, protect yourself by creating a termination clause on your end. You don’t want to be stuck with a nightmare buyer either – so make sure you can end the agreement if needed too.
While it’s 100% true that a buyer’s agreement protects you from them wasting your time, you never want to say it this way. Focus on how the agreement helps them.
Make a Buyer’s Agreement Part of Your Process
Having a standard process for both buyer clients and listing clients will help make onboarding and working with clients much easier.
Just like you (hopefully) have a marketing process that includes updated business cards and print marketing, make a buyer’s agreement a part of your day-to-day operation. You deserve it – and so do your clients.
Do you insist on a Buyer’s Agreement? Why or why not? Share in the comments!