Looking for a home? Hold On…..Not so fast! What you need to know.

Looking for your dream home now requires business first, showing second and a “hold on… not so fast” component.

What Home Buyers Need to Know Post-National Association of Realtors Settlement

The recent settlement between the National Association of Realtors (NAR) and the Department of Justice (DOJ) introduces several changes that will affect how home buyers approach the house-hunting process. Here’s a guide on what buyers need to know to navigate the market effectively in light of these changes.

As of August 17,  2024 ALL AGENTS in the United State are required to meet with potential buyers BEFORE SHOWING A HOME to explain compensation – Who, what, why, when and how to a prospective buyer.  The buyer must sign a Buyer Broker Agreement BEFORE the Agent can show the home because the settlement determined this is required for Transparency in Compensation.

• What Changed:
  • Buyer Agents are required to disclose compensation prior to showing a home.
  • Buyers Agents must have a signed Buyer Broker Agreement prior to showing any home.
  • The co-broker fee will no longer be published in the MLS.
• Buyers will know prior to touring a home: 
  • how much the buyer will need to pay for their Buyer Agent to represent them.
  • how much a seller is offering a co-broke fee to buyers to attract buyers.

• Seller’s offering of a Buyer Co-Broker Compensation is negotiable (as it always has been) :
  • Now your Buyer Agent must request a Broker Compensation Agreement directly from the Listing agent of each home you want to see.
    • This will let buyers know prior to seeing a home how much of a co-broke fee the seller is offering.
  • A buyer may need to pay a portion or all of their Buyer Agent compensation depending on the seller’s co-broker offering.
  • Buyer will need to consult with their lender after receiving the co-broke information to know if they can afford the home. 
  • A buyer can ask their agent to show them only homes that a seller is offering a co-broke fee BUT this request must be done in writing.

The Buyer Broker Agreement:

• Can be signed for a single home and showing date or a determined length of time.
• Can be updated at any time.
• MUST  include the specific compensation the buyer agrees to pay their Agent.
• Agents may require a Retainer fee depending on your house hunting needs. 
• Some Buyer Broker Agreements are exclusive. Make sure you know what you are signing.
• As of August 17, 2024: If you ask an Agent to show you a home without a Buyer Broker Agreement prior to entering the home, you are asking the Agent to violate a requirement and the agent will face being reported, fined (in some areas we understand the fine is $7,000) and may lose their license. 

                                       Call/Text or e-mail me with any questions.

Erin Estes, PLLC, Tried and True!   Associate Broker    erine@cwbanker.com    (928)202-8125                                      

 Coldwell Banker Northland – Cottonwood, AZ