In a real estate transaction, it is important to know the difference between a customer and a client. The difference is a document referred to as the Buyer Representation Agreement. When a Buyer Representation Agreement is in place, you are a client. If this agreement is not signed, then you remain a customer. Unfortunately, the counseling that can be given as a customer is limited. It is assumed, according to the Texas Real Estate Commission, that ALL agents represent the seller unless this Buyer Representation Agreement is signed. This agreement is in place to protect you and Meredith. This eliminates any concerns that too much information is being provided or that the Seller is not being properly represented. The following chart has a great outline of why it is beneficial to be a client instead of a customer.
As a best practice, Meredith will always enter into a written buyer representation agreement with every buyer. This way, there is no ambiguity about who Meredith works for or where her loyalty lies. As her client, she can give you her full professional opinion at all times and answer any and all questions that you have. Furthermore, the agreement clearly spells out Meredith’s duties to you: Obedience, Undivided Loyalty, Full Disclosure, Confidentiality, Accountability, Reasonable care and diligence. A buyer representation agreement also outlines the duties of both parties:
A. The scope of Meredith’s responsibilities in serving you, the buyer, and how compensation will be handled.
- Note that compensation is paid for by the seller, so the buyer doesn’t actually compensate Meredith. This is standard practice and is negotiated between the listing agent and the owner.
B. The expectation of the buyers loyalty to Meredith
- After the Buyer Representation Agreement is executed, it is important that you always announce representation up front to other real estate agents (at open houses), builder’s sales agents (if touring new home models), and For Sale By Owners because, by law, they need to know that you have representation.
The terms of the Buyer Representation Agreement are set between you and Meredith. There are no set terms or standards in the scope of properties that will be shown to the buyer or the time period of the buyer representation agreement. This is why it is important to have a buyer consultation, this meeting is where these perimeters can be discussed and any questions or concerns can be addressed at that time.