At Agents for Homebuyers, we have a strong commitment to buyer agency. If you are considering asking a real estate broker to help you find a home, you can choose to have that broker work with you either as a “buyer agent” or as a “transaction broker.” The difference is both simple and dramatic. A buyer agent (BA) commits to representing you and your interests. A transaction broker (TB) must remain completely neutral between the buyer and seller. In Colorado, neutral transaction brokerage is the default position. This means that a broker must act as a TB unless they have a signed buyer agency agreement with you.
The Transaction Broker's role
The Colorado real estate contract prohibits Transaction Brokers from doing anything that might be interpreted as advancing your interests over those of the seller. A TB has no obligation to make you aware of all the homes on the market that meet your needs. When showing homes, a TB should not bring negative features of a home or neighborhood to your attention. That could hurt a seller’s chances of selling their home, or benefit you by preventing an unwise purchase. When you’re negotiating an offer or inspection issues, a TB should not provide any consultation. Almost any useful advice they could give would violate their legally mandated neutrality. A Transaction Broker can open doors so you can see houses. They can transfer money and papers back and forth, but that is really all their job entails.
You Deserve a Buyer Agent Who is Committed to You
Just like any licensed real estate broker in Colorado can sign a contract to sell your home, any agent can sign a buyer agency agreement to help you buy a home as well. In a buyer agency agreement, a broker commits to representing your interests, accepting a higher level of responsibility and liability. We hope it’s obvious that any buyer who works with a broker that is not representing them under a buyer agency agreement is probably making a serious mistake.
The Agreement Protects and Obligates Both Buyer and Agent
Just as a buyer agent is making a commitment to represent your interests, a buyer agency agreement creates obligations for you as well. Read the agreement carefully and ask questions. It’s not a bad idea for a real estate attorney to review it before signing. We would strongly suggest asking for a clause that gives you the right to terminate the contract if you’re not satisfied with the work your broker is doing for you.