Hello, homebuyers! If you’re about to embark on the exciting journey of buying a home, you’ve probably heard a lot of buzz about the new regulations. And let me tell you, while the chatter may be focused on commissions, fees, and agents, I believe the focus and chatter need to be focused on you, the homebuyer. Just like bringing a baby home for the first time, adapting to these changes will take time, but it’s a milestone in your life, that over a short amount of time, we learn to embrace. I have no doubt homebuyers will shortly embrace these changes and slowly forget what it was ever like to do things the old way. (You can have immediate access to samples of all the new forms at the end of this post)
This post is all about you—the homebuyer. I aim to ensure you understand how these changes will impact you and what you need to know moving forward. There are changes impacting sellers as well, I’ll write another post just for home sellers.
Three Big Changes for Homebuyers
- Signing a Contract with an Agent
You can no longer pick up the phone and request to see a home with any agent. Moving forward, you must first sign a contract with an agent that discloses fees/commissions. Just like sellers have been doing for many years. But don’t worry—I’m here to explain what this means. - Increased Expectations
Homebuyers will now have contractual expectations from their agent regarding follow-up, length of contract, and attentiveness. The only expectation from the buyer is loyalty in return. - Commission:
Sellers/Listings can no longer use the MLS to offer buyers’ agents a commission. This means the buyer’s agent commission is the buyer’s responsibility. This fee will be negotiated in the new Buyer Representation and Broker Compensation (BRBC) Agreement. The seller no longer has buyer compensation in their contract, only Listing agent compensation. This does not mean the buyer, along with their offer, can request the seller pay their buyer’s agent commission.
The Three Contract Options: Dating, Engagement, and Marriage
- Contract Option 1: Dating
This contract allows you to view up to three homes over 30 days and requires a compensation agreement. Think of it as getting to know the agent—like a first date. - Contract Option 2: Engagement
If you like the agent but need more time, you can enter into a Buyer Broker Agreement (non-exclusive) for up to 90 days. This is like being engaged—you’re committed but not exclusively tied to one agent. - Contract Option 3: Marriage
You’ve found the agent you trust and love, so you agree to a 90-day exclusive contract, which can be extended. This is the “marriage” stage—you’re all in.
Key Takeaways
- Open Houses don’t require a contract.
- Viewing homes with an agent requires signing one of the abovementioned contracts.
- Commissions are negotiable— This is a must with your agent. Who will pay, how will commissions get paid, and what happens if you cannot afford a commission? Don’t hesitate to discuss this with your agent.
- Be careful about what you are signing – Ensure you are not signing contracts every time you see a home with a new agent. This can land you some financial obligations; no one wants that for a buyer. Take your time and understand the nuances of these contracts.
- Seller Listing Contracts: Stay tuned for my next post, which will focus on changes for home sellers.
Before you commit to any agreement, it’s essential to familiarize yourself with what you’ll be signing. Whether you choose to have me represent you in purchasing your next home or decide to work with another agent, having the correct information is critical. This proactive step ensures you are well informed about the latest regulations and contract terms, empowering you to make confident decisions when selecting an agent to represent you in your home-buying journey. That’s why I am providing a sample of the contract you’ll be asked to sign.