If you are shopping for a home, you should know the difference between a buyer’s agent and a listing agent.
A buyer’s agent, sometimes known as a “buyer’s broker,” works only for the home buyer, and is legally bound to represent the best interests of the buyer.
A listing agent is the agent who contracts with the home seller to get the home sold.
Although some people will buy homes from the listing agent of a home (say, you drove past a home for sale and called the agent on the for sale sign, or you went to an Open House and later enlisted that agent when you put in your offer.
More than likely you were dealing with the listing agent), you’re better served if you use a buyer’s agent when purchasing.
The job of a listing agent is to get the best deal for their client, the seller.
However, the job of a buyer’s agent is to represent the buyer and get them the best deal on the home.
Realtors who specialize in representing buyers often have the ABR (Accredited Buyer Representative) designation after their name.
The accreditation means they have taken advanced training in negotiation and have completed at least five transactions in which they served solely as a buyer’s agent.
You can find a list of buyer’s agents on the website of the Real Estate Buyer’s Agent Council, rebac.net.
A buyer’s agent will often have you sign a contract to work with them exclusively for a certain period of time.
Realize some of those contracts say that they will get paid a certain percentage of the sale price of the home you buy.
Typically, their payment will come from the seller, but know that some contracts say that even if you buy from a For Sale By Owner, or your friend, who was not listed on the Multiple Listing Service, you will still owe the agent a commission.
Tip: Have the contract limit the agreement to homes for sale in the MLS, or only by sellers under agent representation, given that many FSBOs might still pay a listing service to put their home on the MLS.