Exclusive Buyer Representation Explained
Exclusive Buyer Agents (EBA’s) never take listings and never represent sellers. We only represent buyers and never engage in “dual agency” (representing Buyer and Seller in the same transaction) or “non” agency (called Transaction Broker in Colorado). You do have choices and the more that you understand those choices, the better your buying experience will be. Some of the following information is a bit technical and will be of interest to consumers who want to make a really informed choice of representation.
The “Old” Rules
The practice of real estate in Colorado always favored real estate firms’ ability to earn compensation for both the buyer’s and the seller’s “sides” of transactions. The fact that ALL broker members of the Colorado Real Estate Commission were and are from these traditional companies probably has much to do with that result.
The “automatic” relationship was that brokers always represented sellers unless a consumer knew enough to ask for something better. Somehow most brokers allowed buyers to believe that they were being represented while continuing to do what was best for the seller. (Or maybe what was best for the broker.)
Some of this began to change during the 1990’s following more consumer awareness and subsequent disclosure requirements. However, the new “automatic” relationship, while given the professional sounding title of “Transaction Broker”, is one that does not allow the broker to be an advocate for the buyer or for the seller. “Dual Agency”, the practice of one company representing both buyer and seller, was made legal and the uninformed public continued to be denied the level of representation that they seemed to prefer. Consumers continued to ask more pointed questions and the answers became very uncomfortable for traditional brokers who were trying to protect their ability to be paid for both “sides” of a transaction.
Changes For A New Millennium
In 2002, following major lobbying and political “persuasion’, the traditional real estate firms were able to promote passage of laws that allowed two brokers from the same firm to offer “agency” level service to the buyer and to the seller in the same transaction. The law simply ignored the fact that those brokers are sharing the same office, administrative support, fax machine or perhaps are even married to each other. There is no required disclosure of these “defacto” conflicts of interest or disclosure of the potential for the now illegal practice of undisclosed dual agency. The same law severely limits the ability of this so-called “designated broker” to obtain assistance and guidance from the Employing Broker or from other more experienced brokers in the office. You can immediately see that this system promotes an environment that limits the true assistance, representation and advocacy provided to you. There are several relationships available that provide the illusion of representation. In the end, if you are working with an individual or company that has listings and that also works with and for buyers, it is impossible for you to have the same level of service and loyalty as when you work with a company whose only business is to serve your needs as a real estate buyer.
The Informed Buyer’s Choice
The benefits of exclusive representation become obvious to you when you think about initial offers, price negotiations, repair negotiations and financing. Not only are we always on YOUR side in the process, but also our “buyers only” focus means that we have more experience meeting your needs.
Exclusive Buyer Agency will come to you with no additional cost and provide you the level of service and loyalty that you deserve throughout the home buying process.