Thursday, June 16, 2011

When is a Fee Agreement great to use??

When is a Fee Agreement great to use??

                  - from a Realtor's prespective:
Use a Fee Agreement when the seller is not represented by a REALTOR®. That is - when you have a Buyer interested in a For Sale By Owner (FSBO) property.
                  - from the Seller's prespective:
Sellers that attempt to sell on their own believe they do not need the services of a professional Real Estate Agent.  The Fee Agreement provides that clear distinction for them - the Seller is very specifically NOT represented - only the Buyer has representation by the REALTOR® using the form.  The Agreement simply secures an accepted remuneration amount to be paid by the Seller for the Buyer's Agent, should this 'specific' Buyer purchase the home.  A By Owner Seller often appreciates the opportunity to do business without being required to be under a contract with the REALTOR®. 

The Buyer's REALTOR® still owes a duty of care to the Seller and should  provide a condition in the written contract of purchase and sale, giving the Seller time to seek legal advise regarding the contract.
If the Seller is represented by a REALTOR® who tells you to bring a fee agreement for your commission, that will ensure remuneration for the Buyers Agent only.  If the REALTOR® providing agency to the Seller expects to get paid, the vehicle they should use is not a Fee Agreement but an Exclusive or MLS listing contract.

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