Because most people don’t spend their lives buying and selling real estate, they don’t put much thought into the idea of negotiating the real estate agent relationship. You choose an agent because they’re supposed to be a professional that you can trust.
The overwhelming majority of real estate agents are good people who want to do right by their clients. But, as is usually the case, a few bad eggs mean that buyers and sellers need to be careful before entering an agreement to buy or sell a home.
Finding the Right Agent
In a hot real estate market, the good agents emerge from the fold pretty quickly. The same is true for the more unsavory agents as well. I had first-hand experience with the latter a few years ago when buying a home in the Denver area.
I talked to a number of realtors but didn’t get the results I wanted. Ultimately, I succeeded in reverse engineering a home purchase. I was fortunate to find someone who was looking to flip a house in my desired area, approached them directly, and worked out a deal.
However, after the sale, one of the agents I spoke with earlier in my search contacted me. He claimed that I owed him a 2.8% commission. Keep in mind, that I never signed anything with this agent and found my home 100% on my own. Needless to say, with no legal leg to stand on, the realtor in question quickly disappeared when confronted with reality.
Nevertheless, this should serve as a reminder that there are people out there who will invent relationships in order to make a buck.
When you do find the right agent, you will need to sign one of two different agreements depending on what you’re doing. If you’re buying it’s an exclusive right to buy, and if you’re selling it’s an exclusive right to list (sometimes simply referred to as an exclusive right to sell).
One of the most important aspects of these agreements is that they lock you into working exclusively with that agent for a given period of time. Regardless of whether you’re a buyer or a seller, it’s in your best interest to negotiate these agreements with your real estate agent before signing anything.
Exclusive Right to Buy
This is especially true with an exclusive right to buy. Generally, you don’t want to sign with a buyer agent until your current home is under contract or is very close to being under contract. Of course, people who don’t already own don’t have to worry about this.
Timeline is very critical in real estate. You don’t want to be locked-in to using an agent who suddenly becomes unavailable for some reason. So, if your agent disappears on you, then you need a way out of that agreement. This ensures that you can complete your home purchase in a timely manner that is convenient for you.
Exclusive Right to List
An exclusive right to list differs in terms of timeline because sellers must sign one before the MLS will list their house. Therefore, sellers need to sign this agreement earlier in the process than the right to buy agreement.
At BlueMatch, our clients have to sign an exclusive right to list to satisfy the MLS requirement, however, we clearly indicate the terms of this agreement in black and white. Our right to list is a non-binding agreement, meaning there is no minimum time period that you need to spend with us. You can walk away at any time, for any reason with no questions asked.
Not only does this give you freedom in the home sale process, but it also keeps us accountable. A non-binding agreement forces us to be client-centric, to focus on your needs, and to ensure that you have a positive home buying or selling experience.
Give Yourself an Out
We believe that customer-focused terms in a right to buy/list agreement should be the norm in the real estate industry. Therefore, we’ll even provide our exclusive right to list terms to people who don’t sign with BlueMatch. A good agent won’t bat an eye at terms like ours. If you present them to an agent and they seem leery of the terms, you might consider talking to some other agents.
The bottom line when negotiating with your real estate agent is to make sure you have an out for yourself. Negotiate the terms up-front, before you sign anything. Doing so can save you a ton of time, effort, and money down the line.
To learn more about the BlueMatch process and to get a free consultation, whether you’re buying or selling your home, contact us.