Buyer-Beware Transactions No Longer in Connecticut!!

Both buyers and sellers of real property in Connecticut have the right to representation by a real estate professional in all their real estate transactions.

In a majority of transactions…Sellers through their listing agent…offer to pay the Buying Agent commission from the proceeds of the sale. Few if any Qualified Buyers pay commission directly to their duly contracted Buyers Agent. At time of listing in the multiple listing exchange, the Sellers Agents posts a offer fee (on average ½ of their commission)  for buyers agents state-wide to bring their client to the bargining table.  This is called offering a co-broker or buyer-broker fee to the Agent who delivers a qualified buyer and handles their half of the transaction.   

You Have the Right to be Represented... Contact Chip Now for more info on Buyer Representation.

Consult a REALTOR® to work exclusively on your behalf and sign a contract to establish a client/agent agreement. They say a person who represents himself in a court of law…has a fool for a client. The same may be said for those who buy or sell Real Estate Unrepresented…as every transaction is a complex and multi-faceted process

Advice, experience and good counsel that only a professional REALTOR® can provide will save you time, money and headache in the long run. Contact Chip Now. 

The State of Connecticut passed Buyers Representation laws in 1997 and 1999 that established the Connecticut Real Estate Commission Policy on Agency.

***The following article by Judith I. Johannsen, Assistant Counsel for the Connecticut Association of Realtors Inc. (CAR) appeared in the Hartford Courant on Friday May 27th, 2005.***  

"When sellers have representa­tion, they sign a Listing Agreement with a real estate company. When buyers choose to be represented by a real estate compa­ny; they sign a Buyer Representation Agreement.

Even though buyer representation has been in effect in Connecticut since 1997, many buyers still do not know:

1) that they may have their in­terests represented in a real estate transaction,

2) that a Buyer Represen­tation Agreement is a legally binding contract,

3) what the representation agreement’s provisions mean, and

4) why they are asked to sign one.              

A Buyer Representation Agreement is a written contract between a buyer and a real estate company that al­lows an agent of that company to lo­cate and show properties listed for sale to that buyer.An Exclusive Right to Represent Buyer Agreement means that the buyer will use the services of that company exclusively to find property. Even if the buyer finds the property ultimately purchased, the company is entitled to compensation.While a real estate agent can show properties listed by his or her own company without a signed Buyer Representation Agreement (because the company represents the seller), the Connecticut Real Estate Regula­tions prohibit a licensee from show­ing properties listed by another com­pany without one,All Buyer Representation Agree­ments, to be legally effective, must include certain provisions, some of which are negotiable. Apart from stat­ing the names of the parties to the agreement (the real estate company and the buyer), The agreement must contain a beginning date and an expi­ration date, all the terms and condi­tions of the parties’ agreement, a compensation provision, and must be signed by the buyer and the real es­tate company’s agent. A copy of the fully signed agreement must be given to the buyer.The length of time a Buyer Repre­sentation Agreement is in effect is negotiable. There is no standard, nor­mal or usual period of time and the agreement can be in effect for one week, one month, three months, six months or whatever period of time the parties agree to. The geographical area in which a buyer searches for property is another key Buyer Representation Agreement element and is also a negotiable item. Some buyers know exactly the town or towns where they want to live and can define the geographical area precisely; others are less cer­tain but want to be within a certain number of miles from work or within a specific county,Specificity is good - simply stat­ing “the greater Hartford area” is not clear - not to a buyer and not to a buyer’s agent. Furthermore, knowing the geographical area the Buyer Rep­resentation Agreement covers allows a buyer to engage the services of an­other company in another part of the state without violating the provisions. ­Buyer Representation Agreements must also include a provision ad­dressing the broker’s professional service fee.One of the most misunderstood aspects of buyer representation is how a buyer’s agent’s company gets paid. Most buyers do not want to pay someone to find a property or help with the negotiations and inspections and fully expect that their agent’s company will be compensated by the seller or the listing broker.The fact is that most Buyer Repre­sentation Agreement compensation paragraphs provide that the buyer’s agent’s company will seek compensa­tion from the listing broker or the seller, but if a seller (usually a For Sale By Owner) is unwilling to com­pensate the buyer’s agent’s company or the listing company is not cooper­ating with other brokers, the buyer’s agent’s company will look to the buyer for compensation.Connecticut’s buyer agency policy is user-friendly, but just as buyers ex­pect the companies with whom they sign agreements to honor their prom­ises and obligations, real estate com­panies expect buyers to honor their promises and obligations.

The quick recap: 

1) A buyer wanting representation must sign a buyer representation agreement and be given a copy of it.

2) A buyer representation agree­ment is a legally binding contract.

3) All buyer representation agree­ments must contain certain provi­sions to be legally effective.

4) Some of the terms are nego­tiable.

5) An agent of a real estate broker­age can’t show a buyer another com­pany’s listings without a written, signed buyer representation agreement. 

Contact Chip Now for buyer representation.