[joshkathy]

Hi all,

We're contemplating a move to Connecticut from California and will be visiting Connecticut to look at communities and houses as a part of the decision process. Prior to showing us houses our realtor said Connecticut law required us to sign an "Exclusive Right to Represent Buyer Agreement.' I checked this out and she is correct, but looking at the fine print in the 4 page document blew me away. It required the buyer to pay 2 1/2% of the sales price to the agent. This is really foreign to me because in California, the seller is the one who pays the commision of 5-6% of the sales price which is shared between the buyer and seller's agent...the buyer doesn't pay anything in commissions. Can anyone enlighten me on what is standard practice/legal in Connecticut regarding expectations for a buyer?

[frogcreekwoods]

I've never heard of the buyer paying a percentage to the realtor. In these hard times I think the realtors have had to lower their usual 6% fees, and maybe she's trying to make up the difference through you. I'd run from this realtor.

This link may help but I found it a bit confusing: Who Pays the Fee


You do not have to have a Buyer's Agent in CT, but if you find an agent that you really like and trust, it can be a good idea.

Good luck!

[toddb]

I would be very careful about signing anything, particularly something that 1) forces you to pay a fee as the buyer, or 2) restricts your ability to find something on your own. I can understand an agent wanting to use a buyer's agreement, restricting you from using other agents, but if you are also shopping on your own then you should be able to make a deal without using this agent. Doing that can sometimes save you some $$ as the seller will not need to pay the full 5-6% fee.

[Rich Lee]

This is a duplicate thread. The paragraph that you read is built into the agreement as is the part that also includes "We normally collect our commission from the Seller, but..."

FYI - We are a Buyer Agency state vs a Sub-Agency state. Sub-agency is legal here (where both agents represent the SELLER), but it requires the seller's consent.

[LRPct]

Just as Rich has tried to point out, typically the buyers broker is paid through a split with the selling brokers commision. When a seller lists their property the commision is ALWAYS negotiatable. But, most common is 5.5 - 6 %. It's just not worth the trouble, time, and expense of marketing for most brokers to agree to any less than that. So, TYPICALLY the a sellers broker and buyers broker will split the 6%. Or if the seller decides to be unrepresented the seller broker will have the whole 5.5 or 6 % to them selves.

The clause you were reading in the contract is in there in case a buyer decides they want to purchase a property that may not be on the MLS, or may be a forclosure or shortsale or for some other reason does not provide the full 3%, (or whatever is listed in the contract) commision. It is there to simply protect the broker from not being compensated for their time and energy and resources in finding their client a home/property.

Keep in mind, you of course have say in length of the contract. If the broker agrees, it could be set up for as little as one day, or even on one particular property. There's ways to make everyone happy and protected as well. If one particular broker/agent isn't willing to take the time to explain these types of things to you, I'm sure another will. good luck

[Scott R]

As the prior poster indicated (but which still may not have been as clear as you need it to be), the clause was likely related to situations where you decide to purchase a "for sale by owner" home, where the seller is not offering anything to brokers (because they justly despise them ). Your agent still wants their cut and is then expecting you to pay it. If you think that you might want to buy a "for sale by owner" home like that, you should clarify the details with your buyers agent. If you're still planning on using that agent to assist in the closing, it is reasonable to have to pay them something, but if you found/viewed/bought a "for sale by owner" without any assistance by the buyers agent, then you shouldn't be obligated to pay them anything, IMO, and you should make sure that it's written into the contract as such.

Having said that, there aren't a lot of "for sale by owner" homes that aren't also willing to pay a commission to a buyer's agent. We sold our last two houses on our own but offered the buying agent 3% (we also went through a flat-fee service to get our house listed in the MLS).

FWIW, on the buying end this last time, we used an "Exclusive Buyer's Agent" which is someone who isn't affiliated with a realty firm that sells houses. The idea being that they don't have a conflict of interest whereby they might steer you towards one of their fellow listing agent's homes. That's the idea anyway. My personal opinion is that they're still not necessarily working in *my* best interest, as they still want to make a commission (and as big a commission as possible) and to do so in as quick a manner as possible. So they might push you towards more expensive houses than you ought to be focusing on, and who knows what the buying/selling agent discuss in private, so all sorts of collusion could be going on there. I have no reason to believe that the agent I used did any of that, mind you, and would be happy to pass her name on as a reference. But as a businessman/entrepeneur myself, I see no reason to believe that an exclusive buyer's agent would necessarily be above any of that.

Another alternative which I considered, and might try the next time (if we should ever move again), is a realtor who gives you a "kickback" (so to speak) of their cut of the commission. So if they're getting 3%, they might give you 20% of that 3%. One such company that offers this service is ziprealty.com. I don't know if they're any good (one of the potential buyers of my last house had an agent through them).

[joshkathy]

Thanks so much for the explanations. I took the contract and marked it up the way I wanted it (reduced term to 6 months, only agreed to be locked in to properties actually introduced by the agent, and crossed out the provision saying I would pay the commission). Surprisingly, all the changes were instantly agreed to, and our agent explained that provision had been added in the case of foreclosures and short sales. Again, thanks for the replies.

[kareng531]

Hi - I'm a licensed CT/NY Realtor - my CT Exclusive Right to Represent Buyer document (CT must be in writing) is 2 pages and there is reference to a % that could be due by the buyer but my form pertains to a property should a commission not be offered as eg - For Sale by Owner (FSBO),Foreclosure/ShortSale - and the Buyer still wants the Brokerage Firm/agent to represent them and is willing to pay the commission. A discussion/consultation prior to signing any forms should take place when going over any documents so that any questions can be answer and that all parties understand its contents since clarification might be needed whereas you may misconstrue its meaning differently.
Hope this helps - KG, Realtor - Keller Williams Realty

[EUPL]

You can sign the Exclusive Right to Represent Buyer document once you select the property you want to make an offer on.