buyer's agent (Austin: real estate, broker, how much)

[austin_c0wboy]

In the state of Texas, is it legal for a real estate agent to be a buyer's agent as well? Any recommendations?

[austin-steve]

Yes. It's very common for agents and buyers to enter into a Buyer Agent agreement.

[austin_c0wboy]

When you say "Buyer Agent Agreement"...you mention the person acts like a real estate agent and buyer agent?

[austin-steve]

There are real estate agents licensed in Texas. If you want to purchase a home and wish to use an agent (who is probably also going to be a Realtor), then you hire that agent to represent your interests. That makes that real estate agent your Buyer's Agent.

The Seller will have a real estate agent who is the listing agent (also probably a Realtor) who represents the Seller's interests.

[FromCalitoSteinerRanch]

Originally Posted by austin_c0wboy

When you say "Buyer Agent Agreement"...you mention the person acts like a real estate agent and buyer agent?

Are you currently in CO?

[johnrex62]

Originally Posted by austin-steve

There are real estate agents licensed in Texas. If you want to purchase a home and wish to use an agent (who is probably also going to be a Realtor), then you hire that agent to represent your interests. That makes that real estate agent your Buyer's Agent.

The Seller will have a real estate agent who is the listing agent (also probably a Realtor) who represents the Seller's interests.

You need to point out that unless the buyer and agent have a contract specifying financial compensation from the buyer to the agent there is still a fiduciary relationship between the "buyer's agent" and the seller which puts the agent in a primary seller's agent role. If the agent acts in a manner that puts the seller at a disadvantage in the transaction the seller has legal recourse against the agent. Only with that employment contract does the agent truly become a buyers agent.

I do not recall if a legally contracted buyers agent is permitted to ethically collect the selling commission from the selling broker or not if the buyer's contract is mute on the issue.

The best course of action is to spell everything out in your contract to avoid misunderstandings.

[johnrex62]

Originally Posted by austin_c0wboy

In the state of Texas, is it legal for a real estate agent to be a buyer's agent as well? Any recommendations?

Unless specifically contracted all real estate agents are sellers representatives whether they know it or not since the seller pays the commissions and the selling agent is acting on behalf of the listing broker.

Many present themselves as buyers agents, but there is no legal relationship unless a specific contract in entered into by the buyer and real estate agent.

[austin-steve]

Well, I was trying to keep it as simple as possible. Yes, without a written Buyer Agent agreement, any agent helping a buyer is acting as a sub-agent for the Seller.

There was an interesting survey done by the Texas Association of Realtors trying to ascertain why so few agents in Texas actually use a buyer rep agreement. In a nutshell, agents seem to be afraid that asking a buyer to commit to an agency relationship will scare off the buyer, so the agent simply ignores the buyer rep agreement until an offer is actually written. That's not the correct way to do it.
Here is the article if you're interested.
Using buyer rep agreements/Texas Realtor

As for my wife and I, we have all buyers sign a Buyer Rep before we even leave the starting gate. Yes, some refuse and we part ways right there, even though our simple one-page agreement states that it can be terminated by either party at any time, so it's not locking a buyer into anything, but it explains all the things we are legally suppose to make clear when working with buyers.
Steve

[austin_c0wboy]

No I'm not from CO. Typically how much does the buyer's agent get from the sale? The commission is paid through the seller correct?

[austin-steve]

Typically how much does the buyer's agent get from the sale? The commission is paid through the seller correct?

Technically, you pay the commission but your agent first seeks to collect from the Seller. Whatever amount you and your agent agree to as the Buyer Agent Commission will be the amount the agent is paid. Read the Buyer Rep agreement carefully.

99% of the listings in the Austin MLS offer a 3% commission to the Buyer Agent. If you become interested in a listing that offers more, you would have to pay the shortage. Some listings offer a Buyer Agent bonus or more than 3%, in which case your Buyer Rep agreement will dictate whether the overage is rebated to you or kept by the Buyer Agent.

Personally, I rebate the overage because I don't need it and I don't want there to be even the implication that I would recommend one listing over another due to a better commission. Most commonly, the excess commission comes into play when dealing with new home builders. Insist that your Buyer Rep agreement has any bonuses or overage coming back to you. I can't think of a valid reason for an agent to keep it, though some will argue with me about that.