Understanding the Changes in Buyer and Buyer Agency Agreement Requirements
The world of real estate is ever-changing, and recent updates have impacted how buyers and agents interact. Whether you’re a first-time buyer or a seasoned homeowner in OBX and Northeastern NC, it’s essential to stay informed about the changes in buyer requirements and buyer agency agreements. In this post, we’ll break down these changes and what they mean for you.
A Look Back: Buyer Agency Agreement in North Carolina
Buyer Agency Agreements have been part of real estate transactions in North Carolina since 1995. These agreements outline the relationship between a buyer and their real estate agent, clarifying the duties and responsibilities of both parties. Understanding these agreements is key to ensuring a smooth and transparent home-buying experience.
The Importance of Disclosure: Working with Real Estate Agents
One of the most important steps in any real estate transaction is understanding your rights as a buyer. North Carolina law requires real estate agents to educate buyers about the different types of agency available, including:
- Seller’s Agent: Represents the seller.
- Buyer’s Agent: Represents the buyer.
- Dual Agent: Represents both the buyer and seller in the same transaction.
As a buyer, it’s crucial to know who is representing your interests and how they are compensated. This disclosure helps ensure transparency and fosters a relationship built on trust.
New Rule Effective August 17: Buyer Agency Agreement Required for Showings
A significant change that came into effect on August 17th is the requirement for buyers to enter into a Buyer Agency Agreement before a realtor can unlock a door to show a home. This means that before you view a property with a realtor, you must have an agreement in place with your chosen agent.
What is a Buyer Agency Agreement?
A Buyer Agency Agreement is a formal contract between you and your real estate agent. It outlines the following:
- Your Responsibilities: As a buyer, this agreement explains your obligations to your agent.
- Agent’s Responsibilities: It clarifies your realtor’s duties and how they will represent your best interests throughout the transaction.
- Compensation: The agreement also outlines how your agent will be compensated. In many cases, the seller pays the real estate commission to the listing firm, which then pays the buyer’s agent. Alternatively, you, as the buyer, may pay your agent directly.
Real Estate Commissions: Always Negotiable
One of the most common questions buyers have concerns real estate commissions. It’s important to know that commissions are always negotiable—there has never been a set rate, and there never will be. Whether it’s the seller or buyer covering the cost, the fee is flexible and open for negotiation. This aspect ensures that every real estate transaction is tailored to the needs of the involved parties.
What’s New: Changes in Advertising Buyer Agent Fees
Another key change following the NAR Settlement is that realtors can no longer advertise buyer agent fees or commissions to each other through the Multiple Listing Service (MLS). This means that agents now need to discuss these fees directly with their clients, enhancing transparency and ensuring that buyers are fully aware of the costs involved.
Dual Agency Explained
Dual agency occurs when one realtor represents both the buyer and the seller in a single transaction. While it’s legal in North Carolina, it’s crucial for buyers to understand that the agent is required to remain neutral and cannot favor one party over the other. If you prefer having someone solely in your corner, hiring a buyer’s agent is the best way to ensure your interests are fully represented.
The Benefits of a Buyer Agency Agreement
Hiring a buyer’s agent and signing a Buyer Agency Agreement offers several key advantages:
- Confidentiality: Your agent is required to keep everything you share confidential, giving you peace of mind throughout the transaction.
- Clarity: The agreement clearly outlines the roles and responsibilities of both you and your agent.
- Security: You’ll have a dedicated advocate working to ensure you get the best possible deal, with full transparency on compensation.
Signing a Buyer Agency Agreement: It’s Not Forever!
One of the common misconceptions is that signing a Buyer Agency Agreement ties you to an agent indefinitely. This isn’t true. These agreements can be limited in scope and duration, giving you flexibility. You can set the terms for how long the agreement lasts and even terminate it if your needs change.
——
Stay Tuned!
Over the next 15 weeks, this series will cover everything you need to know about buyer agency. We’ll discuss what a buyer agent should be doing for you, how they can make the process easier, and why their experience is critical to your success. Whether you’re a first-time buyer, upgrading your home, or investing in a rental property, this series aims to be both educational and informative.
We encourage you to engage with us throughout this series. If you have questions or topics you’d like us to cover, don’t hesitate to reach out through YouTube or social media. Your feedback is valuable, and we’re here to help you navigate the buying process with confidence.
Thank you for following along, and don’t forget to like, subscribe, and share this series with anyone who might benefit from it.
——
Watch the Understanding the New Buyer Agency Changes: How the NAR Settlement Impacts You.Don’t just read about it, experience it with us! Watch this episode on our YouTube channel. Hit the like button if you find the information helpful, and subscribe to our channel for future real estate updates and valuable insights.
