Buyer Representation Agreement
It’s important to understand the Buyer Representation Agreement (sometimes called the “Buyer Agency Agreement”) and why your real estate sales professional will want you to sign this type of representation contract.
In Ontario real estate sales professionals must adhere to the Real Estate Council of Ontario ethical guidelines (among many other rules and regulations that RECO administers) for how they conduct themselves and their business practices.
The Buyer Representation Agreement not only contractually obligates you to work exclusively with your chosen REALTOR® it also changes the way that your REALTOR® must work for you.
RECO defines relationships between buyers and real estate sales professionals in two ways:1) Customer2) Client
A buyer “Customer” is not under contract with a REALTOR® and can work with any real estate sales professional, at any time during their home search and sales agreement transaction.
This comes with a very big caveat: A REALTOR® that is not under a representation contract with a buyer has the duty to provide brokerage services to the Customer but has as their primary duty an obligation to the Seller.
A buyer “Client” has specific legal and ethical obligations due them from their real estate sales professional, most importantly the REALTOR® must be working in the Client’s best interest. This duty comes from the RECO Code of Ethics (Section 4) and it enforces that price negotiations, opinions, disclosures and agreements with third parties are handled with the Client’s best interest as the primary objective. It continues with requiring that the REALTOR® informs a buyer client of properties that meet the buyer’s criteria regardless of the commission or other remuneration (Section 19). Failure to work in the buyer client’s best interests are subject to disciplinary action.
As a buyer when you sign the Buyer Representation Agreement you protect yourself, legally and contractually, throughout the home purchase process and have your selected real estate sales representative working strictly on your behalf, not for the seller of the property.
Stated another way: A REALTOR® working with a buyer customer (not client) must provide brokerage services to the customer but is obligated to work in the interests of the seller.
For additional information watch this short video or visit the Real Estate Council of Ontario website.
The real estate sales professionals and staff of World Class Realty Point Brokerage* adhere to the standards as set out by RECO.
When buying a home contact us to receive World Class service and buyer representation services that outshine the competition.