Why Are You Being Asked to Sign a Contract?
So, you’re ready to buy a home. You’ve started scrolling through listings, maybe even picked out a few dream houses. Then, you reach out to a real estate agent, and they hit you with a question you didn’t expect:
“Before we start, would you mind signing a buyer agreement?”
Wait… a contract? Just to work with an agent?
Yes—but don’t panic! A buyer agreement isn’t some sneaky fine print that locks you into an unbreakable contract. It’s simply a professional agreement that lays out expectations between you and your real estate agent.
But do you really need one? What are the different types? And, most importantly, is it in your best interest to sign?
Let’s break it down.
What Is a Buyer Agreement?
A buyer agreement, also called a Buyer Representation Agreement or Buyer-Broker Agreement, is a contract between a homebuyer and a real estate agent.
It defines:
- The agent’s responsibilities (helping you find homes, negotiating, handling paperwork, etc.).
- How long you’ll be working together.
- Whether you’re exclusively committed to that agent or free to work with others.
Think of it as setting the ground rules for your home search. Without an agreement, you could spend weeks working with an agent—only to switch agents at the last minute. That’s frustrating for them, and it can lead to confusion for you.
Are Buyer Agreements Exclusive? The Different Types of Contracts
Not all buyer agreements are created equal. There are different types, and knowing which one you’re signing can make all the difference.
1. Exclusive Buyer Representation Agreement
This is the most common type of buyer agreement, and it means you’re committing to working only with one agent for a set period.
- If you buy a home during this time—even if you find it on your own—the agent is typically entitled to a commission.
- It ensures the agent is fully invested in your search because they know their time isn’t being wasted.
- Some agreements cover specific geographic areas or types of properties (for example, single-family homes but not commercial properties).
Best for: Buyers who want a dedicated agent who will prioritize their home search and advocate for them throughout the process.
2. Non-Exclusive Buyer Agreement
This contract allows you to work with multiple agents, but only the one who ultimately helps you buy a home gets paid.
- You’re not locked in to a single agent.
- Agents may be less willing to dedicate time to your search since there’s no guarantee they’ll get paid.
- This option is best for buyers who aren’t ready to commit but still want professional help.
Best for: Buyers who want flexibility and want to test out working with different agents before committing.
3. Open Buyer Agreement
This is the most informal arrangement—there’s no written agreement at all.
- You can work with as many agents as you want, whenever you want.
- Since there’s no commitment, agents may not prioritize your home search.
- Some agents may refuse to work without an agreement, meaning your options may be limited.
Best for: Buyers who are still casually looking and don’t want any formal obligations.
Why Do Real Estate Agents Use Buyer Agreements?
Buying a home is a team effort between you and your agent. But without a formal agreement, things can get messy.
Real estate agents:
- Spend hours researching properties, setting up showings, and negotiating on your behalf.
- Work on commission, meaning they don’t get paid unless you buy a home.
- Want to ensure loyalty and a clear working relationship.
For buyers, a buyer agreement protects you, too. It spells out exactly what your agent is responsible for and ensures they’re working in your best interest—not just trying to close a deal.
What Should You Look for Before Signing a Buyer Agreement?
Before signing any agreement, pay close attention to these key details:
- Length of the Agreement – These contracts typically last 30, 60, or 90 days. Make sure you’re comfortable with the timeframe.
- Exclusivity Terms – Is this a locked-in commitment or are you free to work with multiple agents?
- Termination Policy – What happens if you’re unhappy with the agent? Can you cancel? Some agreements allow termination with written notice, while others require a specific reason.
- Commission Details – The seller usually pays the commission, but in rare cases, buyer agreements may include a clause requiring you to cover part of the agent’s fee if the seller won’t.
- Geographic and Property Type Scope – Make sure the contract covers the areas and types of homes you’re interested in.
Never be afraid to ask questions before signing. A good agent will walk you through everything.
Should You Sign a Buyer Agreement?
For most serious homebuyers, signing a buyer agreement is a smart move because:
- It guarantees personalized service from a committed agent.
- It ensures your agent is actively looking for the best properties for you.
- It clarifies expectations on both sides, preventing misunderstandings.
If you’re unsure, ask for a shorter term or a non-exclusive agreement to test the waters before making a longer commitment.
And if you’re a real estate agent, sharing this guide with buyers helps set clear expectations—making for a smoother, more professional relationship from day one.
FAQs: Quick Answers for Homebuyers
Q: Do I have to sign a buyer agreement to work with an agent?
A: Not always, but many agents require one before they invest time in your search.
Q: Can I break a buyer agreement if I’m unhappy?
A: Most agreements have a termination clause, so check the contract for details.
Q: Does a buyer agreement mean I must buy a home?
A: No. It simply means that if you buy during the contract period, that agent represents you.
Q: What happens if I find a home myself while under an exclusive agreement?
A: If you signed an exclusive agreement, your agent may still be entitled to compensation—even if they weren’t directly involved. Read the terms carefully before acting on your own.
