Buyer Representation Policies & Best Practices
Buyer Coverage When Out of Town (Policy & Best Practices)
This is policy for company deals and best practice for personal.
If you haven't physically met with the person before (this would be your first meeting,) then you need to hand them off to another agent. If it's a personal deal, that usually means referring them to another agent. If it's a company lead, that means handing them off as a reassignment. This is considered best practice if it's a personal deal and a policy if it's a company deal.
If you've met with the client in the past and developed a rapport, then you want to work out something fair with another agent (usually in our office.) That's generally paying someone or offering a % of the commission (if it's a multi-hour showing) or asking for a favor if it's a quick showing (or asking for a favor if you have an informal partnership with an agent and it's a long showing.) You want to make sure and email whatever you worked out so that everyone has something to reference later.
Buyer Rep Agreements (Policy & Best Practices)
This is policy for company deals & best practice for personal.
Due to the commission lawsuits of 2023, it's important to be transparent about your commission and present a buyer rep agreement early in the process. Many brokerages require buyer rep agreements as their contract package and we do not. The reason we don't is because most agents at those brokerages get them signed late in the process, which doesn't nothing for the client or agent in the way of transparency (which is the important piece here). Here is our process:
- Use our Buyer Rep Agreement, which is easier to understand and is less intimidating.
- Read and understand the buyer rep agreement. We have an easy cancellation policy because we want clients to work with us because they want to work with us. Our agreement does not have a termination date, but is over when they buy a property or if either party (us or them) gives written notice that we want it to end - a simple email or text message.
- Introduce the agreement early in the process. Our email template "LCQ #4 Buyer Rep Agreements" stays updated and is a great template to leverage.
- Build rapport with your client! Show them properties 1-2 times and let them know that you will ask them to sign the buyer rep agreement. Then ask them to sign the agreement. Use ABOR's "Limited Services" form for compliance prior to getting the full form signed.
Escalation Clauses (Policy)
We always recommend against escalation clauses. A buyer may only present a contract with an escalation clause in Texas if that clause is written by an attorney. Agents may only present a contract with an escalation clause with broker/manager approval (if written by an attorney.)
Sending Any Document for Signatures
Any time you send any contract (purchase, listing agreement, sdn, etc...) for signatures, you want to first send it to your clients to review in email. When you send the email, bullet point the highlights of the document and finish by saying "In the interest of time, I'm going to go ahead and set this up in Docusign, but please let me know if you have any questions or concerns." You're communicating that you're here to help them understand the contract and that you're not pushy.
No Biased Vendors / Inspectors
Home inspectors are inherently unbiased. It's their job to provide a report based on current code. However, when you have to bring in specialists to inspect specific systems, many are inherently biased because they also perform repairs on that system (and some get commissions if they "find" more problems!) It's important to always advise and refer the best inspector/vendor for every system, and an "unbiased" is a top quality you should always look for. Lots more info here (please read it if you're not familiar!)