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The Sitzer|Barnett decision changed the way our industry practices real estate for the foreseeable future. The resulting changes in practice required us to unlearn old ways of doing business and relearn an entirely new way of doing business.
We provide a large amount of information related to working with buyers, sellers, landlords, and tenants on how to complete buyer representation agreements, indemnity agreements, listing agreements, addendums, amendments, cancellation and termination agreements, and even lease agreements. I have received training.
Here are seven things to keep in mind when using new forms since Sitzer. Barnett era:
Buyer’s representative
Working with buyers or prospects by properly documenting the business relationship is what Postsitzer is all about. Barnett’s world. There are a variety of options for buyer representation agreements, from exclusive agreements to limited tour agreements to single property referral agreements.
Be sure to choose the contract that best suits your relationship with the consumer, and make sure that even if the contract is not exclusive, both parties can convert it into an exclusive contract if they wish.
Please make sure you complete all fields and do not leave anything blank that could compromise your ability to receive compensation, such as:
Term: Make sure you complete the term according to your state’s deadline limits (if applicable) or to the satisfaction of both you and the buyer. For example, California law currently states that a buyer agency agreement may not exceed three months.
Pay close attention to timing if a contract expires, enters or ends while the buyer is making an offer. Make sure you and the buyer understand what happens in the contract. Will it be automatically extended until one of the above activities is finished or do I need to modify it to set up an extension?
Property Type: Make sure you complete this in a way that accurately reflects your search results for area, property type, price range, and other criteria. Be careful not to make the range too narrow. Your ability to receive compensation may be at risk.
At the same time, you don’t want the scope to be so broad that it’s difficult to really determine what the survey is (say, an entire state) unless you’re actually involved in a real estate survey that covers that area.
Agent Relationships: Be sure to understand what this section of the buyer agency agreement says and whether it refers to another agent disclosure that the buyer will need to sign.
Some states, such as Florida, have different representation agreements depending on the type of representation entered into, such as transaction brokerage, sole agency, and no-agent purchaser agreements. Be sure to understand the differences when determining the appropriate contract for your business relationship with a buyer and whether you can move to another type of agency relationship if applicable in your market.
