If you haven't purchased a home in the last few years, something about the process may surprise you.
You call a real estate agent and say:
“I'd like to see this house.”
And the agent tells you that before you begin touring homes together, you'll need to sign a written buyer agreement.
Your first reaction might be:
“Wait. I have to sign a contract just to look at houses?”
I understand why that can feel strange, especially if the last time you purchased a home, you simply called an agent and started looking.
The rules surrounding buyer representation changed significantly in 2024, and Louisiana has its own law concerning written buyer agreements.
So let's talk about what a buyer agreement is, why you're being asked to sign one and what you should understand before you do.
First: Your Agent Didn't Make Up This Requirement
This is probably the most important thing I want buyers to understand.
If I tell you we need a written buyer agreement, I'm not suddenly putting paperwork in front of you because I don't trust you or because I'm trying to pressure you into buying a house.
In Louisiana, state law requires a buyer agreement between a broker and buyer in certain residential home buying circumstances.
In addition, real estate professionals participating in the MLS covered by National Association of REALTORS® practice requirements must have a written agreement with a buyer they're working with before touring a home together.
These changes became effective in August 2024.
So if you purchased your last home before then, the process may feel different this time.
That's normal.
What Is a Buyer Agreement?
At its core, a buyer agreement puts the relationship between you and your real estate broker in writing.
It should explain important things such as:
What services the broker will provide.
The terms of the relationship.
The broker's compensation or how that compensation will be calculated.
The responsibilities agreed upon by the parties.
Think about it this way:
Sellers have traditionally signed listing agreements establishing their relationship with the brokerage representing them.
Now buyers should also expect their relationship with their real estate professional to be clearly documented.
I actually think the transparency can be a good thing.
You should understand who is representing you, what services you're receiving and how your real estate professional may be compensated.
Do I Have to Sign One Before I See a House?
If you're working with a real estate professional subject to the NAR/MLS practice requirements, the written agreement needs to be in place before you tour a home together, whether that tour is in person or a live virtual tour.
That doesn't mean you need to sign an agreement simply to call me and ask questions.
We can talk.
We can discuss the buying process.
You can ask me about my services.
You can decide whether I'm someone you want to work with.
But once we begin working together and touring properties, the appropriate written agreement needs to be in place.
What If I Go to an Open House?
This is an important exception.
If you walk into an open house on your own, you generally do not need to sign a buyer agreement simply to tour that open house.
The agent hosting the open house is typically there on behalf of the seller or listing brokerage, not necessarily acting as your buyer representative.
You can look at the house.
You can ask questions about the property.
And you don't have to sign a buyer representation agreement merely because you walked through the door.
If you later decide you want an agent to represent you as a buyer, that's when the representation conversation becomes important.
Does Signing a Buyer Agreement Mean I Have to Pay My Agent Out of Pocket?
Not necessarily.
This is probably the second biggest concern I hear.
Buyer agent compensation can come from different sources depending on the transaction and the agreement.
Louisiana law specifically allows a buyer agreement to provide that broker compensation may come from the buyer, seller, listing agent or a combination of sources.
A seller may agree to pay some or all of the buyer broker's compensation.
A buyer may also ask for compensation to be included as part of negotiations with a seller, when appropriate.
But seller paid buyer broker compensation is not guaranteed.
That's why we need to talk about compensation before we start looking at homes rather than waiting until you've fallen in love with one.
I want you to understand what you've agreed to and what the financial possibilities are.
No surprises.
Real Estate Commissions Are Negotiable
This is another important point.
Real estate brokerage compensation is not set by law.
There is no standard commission required by the government, the National Association of REALTORS®, an MLS or any other organization.
Compensation is negotiable.
Your written buyer agreement should clearly explain the compensation you've agreed upon with your broker or how it will be calculated.
That's a conversation we should have openly before you sign.
What Am I Actually Getting From a Buyer's Agent?
This is the part of the conversation I think matters most.
A buyer agreement shouldn't simply be about what an agent gets paid.
It should also make clear what you're receiving in return.
When I'm representing you in the purchase of a home, my job involves much more than unlocking doors.
Depending on your transaction and our agreement, my work may include helping you:
Understand the buying process.
Establish objective property search criteria.
Identify properties that meet those criteria.
Coordinate showings.
Evaluate asking prices and comparable sales.
Understand the terms of an offer.
Prepare and negotiate an offer.
Evaluate seller responses and counteroffers.
Navigate inspections.
Address repair negotiations.
Work through appraisal issues.
Coordinate with your lender, inspectors, title professionals and other parties.
Monitor contractual deadlines.
And help keep the transaction moving toward closing.
Opening the door is the easy part.
The real work often begins after you decide you want the house.
Why Having Your Own Representation Matters
The seller may have a real estate agent representing the seller's interests.
That agent's responsibilities are to the seller within the scope of that agency relationship.
As a buyer, you should understand who represents your interests and what type of relationship you have with the real estate professional assisting you.
That's one of the reasons putting the relationship in writing can be valuable.
It creates clarity before we're in the middle of negotiations involving your money and a major purchase.
Don't Be Afraid to Read the Agreement
Please do.
I want you to understand what you're signing.
Ask questions.
How long does the agreement last?
What services will be provided?
What compensation have you agreed to?
Under what circumstances could you owe compensation?
Is the agreement exclusive?
What happens if you want to change or end the relationship?
What geographic area or type of property does it cover?
Don't sign something you don't understand.
A professional real estate relationship should begin with a clear conversation, not pressure.
What If I'm Already Working With Another Agent?
Tell me.
This is important.
If you've already signed an exclusive buyer agreement with another real estate broker, that agreement may affect whether another agent can provide you with certain real estate services.
Don't assume that you can simply sign another agreement because you found another house or contacted another agent.
If you're unsure what you've signed, review your existing agreement.
And if necessary, seek appropriate legal advice regarding your contractual obligations.
Can the Buyer Agreement Be Changed?
Depending on the agreement and circumstances, the parties may be able to mutually agree to modify its terms.
The agreement itself should be reviewed carefully so you understand its duration, scope and any provisions addressing modification or termination.
Again:
Read it. Ask questions. Understand it before signing.
That's advice I would give you about any important real estate document.
Why I Think This Can Actually Be Good for Buyers
At first glance, more paperwork doesn't sound like an improvement.
I understand that.
But there's another way to look at it.
Before we spend weeks looking at houses together, we have a conversation about expectations.
You understand what I'm going to do for you.
I understand what you're looking for.
We discuss how I'll be compensated.
We establish our working relationship.
And then we go find your home.
There's clarity on both sides.
I would much rather have that conversation before we start looking than discover a misunderstanding when you're ready to make an offer.
Buying a Home in Lafayette or Acadiana? Let's Talk Before We Start Looking.
If you're thinking about purchasing a home in Lafayette or the surrounding Acadiana area, don't let the buyer agreement requirement intimidate you.
Call me before you're ready to tour houses.
We'll talk about what you're looking for, your price range, financing, the buying process and how buyer representation works.
I'll explain the buyer agreement and answer your questions before I ask you to sign it.
And if you're a first time buyer?
That's perfectly fine.
If you haven't purchased a home in 10 or 20 years and everything seems different?
That's fine too.
My job isn't simply to show you houses.
It's to help you understand what you're doing before you make one of the largest purchases of your life.
Let's start with a conversation.
Melanie Nash, Broker/Owner
National Realty of Acadiana LLC
Lafayette, Louisiana
nationalrealtyacadiana.com
Local Expertise. Personal Service. Proven Results.
National Realty of Acadiana LLC provides equal professional service without regard to race, color, religion, sex, disability, familial status, national origin or any other characteristic protected by applicable law.
This article is for general informational purposes and is not legal or financial advice. Buyer-agreement requirements can depend on applicable law, MLS rules, brokerage practices, the property and the type of transaction. Real estate brokerage services and compensation are negotiable and are not set by law. Buyers should carefully review any agreement before signing it and consult an attorney regarding questions about their legal rights or contractual obligations.