The BRA – Buyer Representation Agreement
As of August 17, 2024, buyers will legally be required to sign the Buyer Representation Agreement, also referred to as the BRA. This agreement clearly spells out the relationship between the brokerage and the buyer, and it includes compensation should the buyer go into escrow on a property. Properties will not be allowed to be viewed without this signed document.
Although this document has been available for use, it will now be a requirement. And, depending on what each seller decides to do in regards to cooperating brokerage compensation, the buyer may be responsible to pay all or part of their brokerage compensation. The buyer’s agent will need to contact the seller’s agent at the time of requesting a showing to discover what the compensation will be. This will then be shared with the buyer so they understand what, if any, additional expense is involved with each listing.
THE SHIFT FOR SELLERS
For sellers, the MLS will no longer share what the seller compensation will be to the brokerage that brings the buyer, referred to as the cooperating brokerage. This compensation has always been negotiable, but as of August 17th it can no longer be included on the MLS. When a seller signs the Exclusive Right To Sell Agreement it will note what the seller will pay to the listing brokerage, often a percentage of the Purchase Contract price. It will also note what, if any, compensation the seller will pay to the cooperating brokerage at the close of the transaction. In regards to the cooperating brokerage compensation, the seller can pay the entire amount, a portion, or none.
BENEFITS TO THE SELLER
At first glance, a seller may feel that it is in their best interest to not include cooperating brokerage compensation. But, is this the wisest choice?
1. It may reduce the buyer pool, the number of buyers who would be interested in the property, due to shifting a sizable expense to the buyer. Buyers may choose to forgo looking at a property for this reason.
2. Buyers may still present a Purchase Contract which includes the seller covering all or part of the cooperating brokerage compensation. The seller can accept, reject or counter any portion of the Purchase Contract.
As an Accredited Buyer’s Representative (ABR) I am certified through the NAR to assist both sellers and buyers in navigating what may appear to be a confusing change to the Buyer/Seller process. But, each party has a number of options, and it is in understanding these options that helps to clear the way for a successful transaction.
BUYERS: Feel free to contact me to receive your complimentary Your Home Your Way brochure, provided by the NAR.
SELLERS & BUYERS: I am happy to answer all your questions, whether you plan to list or purchase now or in the future.
