I’d like to buy a home, and my salesperson has suggested I should sign a Buyer Representation Agreement – is that necessary? What do I need to know? (Part One)

You don’t have to sign a Buyer Representation Agreement (BRA) in order to work with a real estate brokerage, but it might be a good idea to sign one because your rights and obligations in dealing with the brokerage will be established in writing.

Businesses rely on word-of-mouth referrals, so most salespeople and brokers are usually eager to resolve complaints to the consumer’s satisfaction through frank and open conversation. In the unlikely event you have a dispute that cannot be resolved, it’s always better to have a signed contract rather than an oral agreement should you feel the need to take legal action.

There’s another advantage to signing a BRA: you will become a client of the brokerage. As a client, you can expect a fiduciary duty from the brokerage and its employees. That means they must follow your lawful instructions, protect any confidential information you give them, and promote your best interests in the transaction.

The alternative to working with a brokerage as a client is to work with one as a customer. “Client” and “customer” may sound alike, but the brokerage won’t owe you a fiduciary duty if you sign a Customer Service Agreement. Your salesperson may help you complete your transaction, and they must treat you with fairness, honesty and integrity, but they are not required to keep your motives for buying or your price limits confidential.

Here are a few basics about BRAs. A BRA is a binding contract that commits you to work the brokerage when you’re in the market to buy a home. It can be as broad or as limited as you and the brokerage agree. It establishes your price range, as well as property types and geographic areas that will instruct your salesperson’s search for suitable properties, determines the commission amount and how your salesperson’s brokerage will be compensated, and establishes how long the contract will be in force. If the commitment is more than six months, this date must be initialed to ensure consumers understand how long the contract will stay in effect. The contract will also highlight any special service or rebate arrangements you may have with your salesperson.

It’s best to read through the brokerage’s BRA line by line with the salesperson to make sure you understand the relationship. Since you will need a lawyer who is insured to practice real estate law to complete the final transaction, you may want to hire one early in the process and ask them to review the document.

If you have a question for Joe about the home buying or selling process, please email information@reco.on.ca.


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Joseph Richer is Registrar of the Real Estate Council of Ontario (RECO). He is in charge of the administration and enforcement of all rules that govern real estate professionals in Ontario. You can find more tips at reco.on.ca, follow on Twitter @RECOhelps or on YouTube at http://www.youtube.com/RECOhelps.

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