Buyer Representation Agreement Flashcards

Buyer Agency Agreement

A written contract between a buyer and a real estate agent that establishes a fiduciary relationship and outlines the agent's duties, compensation, and the scope of representation.

Buyer Agent Compensation

The fee paid to a buyer's agent for representation services, which can be paid by the buyer, the seller, or split between parties as negotiated in the buyer agency agreement.

Buyer Agent vs Transaction Broker

A buyer agent owes full fiduciary duties to the buyer, while a transaction broker facilitates the transaction without representing either party and owes limited duties to both.

Buyer Broker Duties

The fiduciary obligations a buyer's agent owes to their client, including loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care.

Buyer Consultation

An initial meeting between a buyer and agent to discuss the buyer's needs, explain agency relationships, review representation agreements, and establish expectations for the home-buying process.

Buyer Due Diligence

The buyer's right and responsibility to investigate a property's condition, legal status, and suitability before completing a purchase, typically during a specified due diligence period.

Buyer Loyalty Obligation

The duty of a buyer's agent to act solely in the buyer's best interest, avoiding any conflicts of interest and putting the buyer's needs above the agent's own financial interests.

Buyer Pre-Approval

A lender's conditional commitment to provide a mortgage loan up to a specified amount, based on verification of the buyer's income, assets, credit, and employment.

Buyer Rebate

A portion of the buyer agent's commission returned to the buyer at closing, legal in most states as a way to reduce the buyer's closing costs.

Buyer Representation Disclosure

A form that explains to the buyer the types of agency relationships available and the duties associated with each, required to be provided before substantive discussions begin.

Cooperative Compensation

The practice of a listing broker sharing commission with a buyer's broker, historically offered through the MLS but now prohibited from MLS display under the 2024 NAR settlement.

Dual Agency from Buyer Perspective

A situation where one agent or brokerage represents both the buyer and seller in the same transaction, requiring informed written consent from both parties due to inherent conflicts of interest.

Exclusive Buyer Agency

A representation agreement where the buyer works exclusively with one agent for a specified period, and the agent earns compensation regardless of who finds the property.

MLS Changes Post-Settlement

Modifications to Multiple Listing Service rules following the 2024 NAR settlement, including the removal of buyer agent compensation offers and new requirements for showing access.

NAR Settlement Rules (2024)

The 2024 National Association of Realtors settlement fundamentally changed how buyer agents are compensated, requiring written agreements before showing property and prohibiting cooperative compensation offers on the MLS.

Non-Exclusive Buyer Agency

A representation agreement allowing the buyer to work with multiple agents simultaneously, with only the agent who procures the property earning compensation.

Procuring Cause

The agent whose actions were the primary reason a real estate transaction was completed, determining which agent earns the commission in a sale.

Showing Property Requirements

The rules and procedures an agent must follow before showing property to a buyer, including having a signed buyer agency agreement and coordinating with the listing agent.

Steering

The illegal practice of directing homebuyers toward or away from certain neighborhoods based on race, color, religion, sex, national origin, disability, or familial status.

Termination of Buyer Agency Agreement

The legal ending of a buyer representation agreement, which can occur through expiration, mutual consent, breach, or specific termination provisions outlined in the contract.