Prices are good. Interest rates are low. It’s a great time to go shopping for a home. Your first step toward homebuying may include searching on the internet, filling out contact forms for more information on properties, visiting model homes or driving neighborhoods you like and calling phone numbers on real estate for sale signs.
Before you speak to a real estate agent or sales person at a builder open house, you should know that their duties depend on whom they represent. If you are serious about buying a home, you should understand the types of relationships defined by state law that a real estate broker can have with you.
At first contact with any real estate agent or broker, you should be presented with an “Information About Brokerage Services” statement. All real estate licensees are required to present this form to prospective buyers and sellers as soon as any “substantial” discussion about real estate occurs.
If you have contacted an agent off the internet, a yard sign or an open house, it is likely that the agent represents the seller of the home you are considering. Anything you tell this agent will be shared with the seller. Any excitement you show will sway negotiations from you to the seller should you decide to buy that home.
You can choose to work with the listing agent or builder representative, but it’s best not to share with that agent anything you don’t want passed on to the owner. All brokers are obligated by law to treat you honestly and to provide you with information specific to the condition of the property. Only a broker or agent representing you will have your best interests in mind.
If you choose to have a broker or agent represent you, you should enter into a written agreement that clearly establishes obligations, including how and by whom the broker will be paid. You have the right to choose the type of representation, if any, you wish to receive.
Types of Agency:
Seller Agency: A broker who lists a property for sale, through a written listing agreement, represents the owner. A builder’s representative in a model home represents the builder. When you see an agent’s name and company on a yard sign, both the company and agent represent the seller of the home. If you visit a web site, the agent’s listings are seller represented homes.
Buyer Agency: A broker who agrees to represent a buyer’s best interest in the purchase of a property. While a verbal agreement can create an implied agency agreement, only a written agreement can be enforced. Should you choose to have a buyer’s agent represent you, there should be a written agreement which describes the terms of your relationship and the responsibilities of each party so that there are no misunderstandings.
Intermediary: A broker or agent can also act as an intermediary. Both the buyer and seller must give written consent for this relationship to occur. This consent must specifically include the obligations of the intermediary to both parties. Within the same real estate company, it is possible for you to have an agent represent you and another agent represent the seller. This places the broker in the position of being the intermediary. Keep in mind that your agent in this situation may show you other companies’ listings as well.
For more information on buyer agency in Texas, contact me or call 512-266-2606.