The biggest change requires home buyers to have a written BUYERS AGENCY AGREEMENT (legal contract) with a buyer agent BEFORE touring properties. Members of NAR (National Association of REALTOR) in South Carolina have already used a buyer's agency agreement for years. Still, the new agreement will be more detailed and require a longer explanation to home buyers. The changes do not allow for home showings without a written agreement for buyer agents.
Another big change is that when a home is listed for sale in our local Multiple Listing Service (MLS), the REALTOR Association is no longer allowed to post the compensation (commission/fee) the seller will pay a Buyer's Agent to sell the home. A Real Estate Buyer's Agent must contact the listing agent/office or find someone with that information directly.
When you hire a Buyer's Agent and sign an agreement (legal contract) with a Buyer's Agent, you will identify in that agreement how your Buyer's Agent gets paid. This means that the home buyer may be responsible for making sure the Buyer's Agent is paid.
Here are some examples of how your buyer's agreement (legal contract) could play out
When the seller places the property for sale they may agree to pay a commission to both seller and buyer's agent. As an example, the seller agrees to pay a total commission of 6% when the property is sold. If the buyer does not use a Buyer's Agent then the listing agent gets the full 6% commission. If the buyers have a buyers agent the commission may be split between both agents. The difference is that the buyer has a real estate agent working for them. Either way, the seller is paying the 6% commission on the sale of the property and the home buyer does not save any additional money.
Consumers must understand when they contact the new Construction Real Estate Company/Agent that sits onsite or a real estate agent with the sign on the front yard of a home they are contacting the SELLER’s Real Estate Company/Agent. By law, the SELLER’s Real Estate Company/Agent legally works for the SELLER and by LAW the Company/Agent must represent and negotiate in the best interest of the SELLER. While most Real Estate Agents try to be fair, the listing Company/Agent is representing the SELLER and is bound by Real Estate License Laws, the Law of Agency, and their Code of Ethics. The listing Company/Agent can't tell you if the home is overpriced or give you negotiating advice.
We feel a Buyer's Agent is important for a home buyer. Understand that a listing agent has the legal requirement to represent the SELLERS best interest. In part that means getting the highest price and best terms for their client (The SELLER). A Buyer's Agent has the legal responsibility to represent the BUYER and try and get you the best price and best terms for their client (the buyer). It is important when entering into a Buyer’s Agency Agreement that you understand what you are agreeing to and for how long. Please talk to your buyer's agent in depth about how the new changes will affect your home purchase.
