Contracts in general tend to be difficult for people to sign. There is a finality to it. Obligation. If you've bought a home in Ontario, you've likely seen this form.
There are reasons that this form is used that protect both you as the buyer, and us as the REALTOR. When you sell your home, for example, you sign a contract (the Listing Agreement) before your house goes on the market. For some reason, buyers are hesitant to sign the same type of contract.
Here are some reasons that should help you make the decision to sign the Buyer Representation Agreement (BRA) before you start working with your REALTOR:
- you know what duties the real estate brokerage (ie the company with which your REALTOR is affiliated) owe you throughout the process, including negotiating the best deal for you
- you have peace of mind knowing that your REALTOR is obligated to give you full disclosure about any properties listed on MLS, along with other professional advice as you continue to work together
- you know that your REALTOR is protecting your best interests from the beginning of the relationship, through the offer process, and up to and including the closing day
- your REALTOR will give you expert advice on knowledge of properties, neighbourhoods, and the market
You may be nervous signing a buyer's contract. Here are some misconceptions that buyers have about signing this contract before the offer process begins:
- you have to buy a property within the time frame listed in the contract. Wrong! You and your REALTOR decide on a reasonable length of time to find your home in this contract. If you don't find anything you like, you can hold off on your search, sign an amendment to this contract to extend the time frame, or choose another REALTOR if you're not happy with the service you got the first time around.
- you have to pay your buyer's agent a commission. This statement isn't necessarily wrong, however the vast majority of buyer's agents are paid by the seller of the home you buy. When you're interviewing REALTORs to act as your buyer's agent, make sure they explain this clause to you so you understand exactly what it means.
- the BRA only protects the REALTOR ensuring they have a commitment and security from you. In fact, signing the BRA early will ensure that you get the best service that actually works in your favour.
By law, a buyer's agent should present you with this document before the home-buying process begins. If they don't, ask to see it! Buying a home is a complicated process, and the more you learn early on the better prepared you'll be when it comes time to make an offer on your dream home.