Q: We were given a buyer-broker agreement the day after we signed a contract to buy a house. Do we have to sign?
A realtor that helped us find a home to buy gave us buyer-broker agreement the day after we signed a contract to buy a house. We now close on home in a week and she is making us sign the buyer-broker agreement. She never told us we would have to sign any agreement with her brokerage prior to making the offer/signing home purchase contract. She never told us of a $450 admin fee or that if we voluntarily walk away from the house, we would have to pay 2.5% of the purchase price to her. Her name is already listed in the home purchase contract with seller paying commission. What happens if we don’t sign the buyer-broker agreement? We don’t feel comfortable signing a back dated agreement that we never knew about prior to making the offer and now could potentially pay 2.5% of purchase price to realtor if sale falls through.
A:
You misunderstand the document, and who pays the buyer's agent. Our lawyers are also licensed brokers, so we understand your question. It is the SELLER that pays the entire 6% commission, which is then SPLIT in some way with YOUR buyer's agent. The 2.5% you refer to DOES NOT come out of your pocket. The SELLER is paying, because your agent brought a willing buyer to the deal.
Now, your agent should have had the documents executed before the deal. But even if you refuse to sign, the seller will pay the entire 6%. If you don't have an agent, it just means the seller's agent keeps all the commission money.
If you have questions, still, please contact a lawyer in your County. For an hour of his/her time, you can have your entire contract reviewed and explained.
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