ALWAYS CHOOSE A REALTOR®

Only certain real estate agents meet the qualifications necessary to be a REALTOR®. Some agents have licenses that allow them to sell real estate, but they are not committed to the higher standards of professional ethics and integrity upheld by REALTORS. There is always a risk in using an agent with lower standards--insist on a REALTOR®.

ARE ALL REALTORS ALIKE?

No. There are four basic types of REALTORS: Seller Agents, Exclusive Buyer Agents (or Brokers), Dual Agents (including Non-Exclusive Buyer Agents), and Transaction Brokers. (In the state of Texas there are no Dual Agents or Transaction Brokers permitted. Instead, where allowed, they are called Intermediaries.)

1. SELLER AGENTS -- list property and represent the seller. Remember If you are buying a home and call the listing company, it is the legal obligation of the company's agents to get the highest price and best conditions for the seller. Any information given by a prospective homebuyer to the seller agent must be told to the sellers. This includes any reference to the buyer's financial and personal data, potentially increasing the cost of the home by thousands of dollars.
2. EXCLUSIVE BUYER AGENTS -- represent homebuyers--never sellers. These agents are required by law to get the best price and best terms for the homebuyer. All consumer advocates recommend that homebuyers take advantage of the benefits offered by Exclusive Buyer Agents, including:
• Professional NEGOTIATION of price and terms favorable to the buyer.
• CONFIDENTIALITY of the buyer's financial and personal information resulting in increased strength throughout the negotiating process.
• DISCLOSURE of all discovered weaknesses and strengths of the property.
• OBEDIENCE to all requests of the homebuyer. This agent works for the buyer and listens to the buyer's needs for finding the right home.
• 100% LOYALTY to the homebuyer--providing guidance and counseling throughout the entire process.

Exclusive buyer agents are specialists in the home buying process. This higher level of professional service for buyers has resulted in an average of over 5% savings and greater satisfaction for homebuyers. Because these agents do not list property, they do not have company listings to try to sell to you first. Instead, all homes are available to homebuyers without bias, including For Sale By Owner, New Construction, and MLS (other Realtor listings) homes.

DUAL AGENTS

Dual agents are real estate agents whose company lists property, but act as buyer agents on those properties. Unfortunately for both buyers and sellers, dual agents are legal in most states. While dual agents attempt to justify this practice, consumer advocates warn NEVER to use a dual agent. The National Association of REALTORS wrote that the practice of dual agency is as dangerous as playing Russian Roulette.

If a real estate company lists property and represents the seller--you can strongly doubt any attempted claim that their agents can properly represent homebuyers.

TRANSACTION BROKERS

Transaction Brokers are also known as a facilitators, finders, and statutory agents. These are true non-agents because there is no liability for wrongdoing. This attempt by a growing number of real estate agents to avoid the responsibility owed to buyers and sellers is legal in a few states (including Florida and Colorado). Services by transaction brokers are substantially reduced from those of true agents, and should be avoided by both sellers and buyers.

CHOOSING AN EXCLUSIVE BUYER BROKER

Steps to ensure the selection of a quality Exclusive Buyer Broker include:

1. Be sure the Exclusive Buyer Broker is a REALTOR® whose company does not take listings.
2. Use only Exclusive Buyer Brokers who have access to For Sale By Owner, New Construction, and Realtor MLS Homes.
3. Membership in a national organization assures a higher standard of quality service (for example, Buyer's Resource, The Buyer's Agent, National Association of Exclusive Buyer Agents (NAEBA), etc.).
4. Insist upon signing an Exclusive Buyer Agency Agreement (or contract). This agreement assures that the real estate agent and company are committed to the buyer exclusively. Those companies who do not use this agreement are not able or willing to make a full commitment to you. At the signing of this agreement, many Exclusive Buyer Agents require a small retainer fee, which is usually refundable at closing. This retainer represents a mutual commitment of the buyer and agent.
5. Be sure that the Exclusive Buyer Agent uses a Purchase and Sale Contract that is "buyer friendly." (Most contracts are seller oriented.) Your Exclusive Buyer Agent will negotiate terms and conditions in the contract that offer greater protection to homebuyers.

BUYING A NEW HOME: SHOULD I USE AN EXCLUSIVE BUYER AGENT?

Yes. It is just as important to use a qualified Exclusive Buyer Agent REALTOR® in purchasing a new home. Benefits include:

1. Knowledge and history of various developments, helping match the buyer with the right community.
2. Knowledge of builders' pricing strategies help buyers determine best negotiating strategy.
3. Knowledge of other builders of equal and greater quality help buyers get the best builder for the money.
4. Knowledge of builders' reputations regarding quality, follow- up and financial stability, help prevent problems after the sale.
5. In many cases, lower prices of other concessions are offered to buyers with buyer agents, as builders consider these agents as "multiple sources of buyers." Individual buyers buy only one home; buyer agents bring in many buyers.

Be sure, however, to use only Exclusive Buyer Agent Realtors who can help buyers with both new and existing homes. So-called new home specialists often do not have access to or knowledge of existing homes and have monetary relationships with builders.

SELLING YOUR HOME: CAN AN EXCLUSIVE BUYER AGENT HELP ME?

Yes. An Exclusive Buyer Agent only represents homebuyers and does not take listings. These agents, however, work with hundreds of listing agents. They know which ones will aggressively market your home and which ones only give a good listing presentation.

If you are selling your home as a For Sale By Owner, certain Exclusive Buyer Brokers can often suggest ways to advertise your home and even advertise it on the Internet.

(Parts of this page of information are compiled from Smart Money, Money Magazine, The Wall Street Journal, and other consumer oriented publications.)

http://www.buyersresource.com/Bchoosingra.html