Do Buyers know the difference in a Listing Agreement and a Sales Contract?

Recently there have been many instances of blog posts relating a concern about Buyers not having or understanding Representation. I myself encountered a nice young couple who declined Buyers Representation and during the previewing tour the Mr of the couple told me he would rather work only with listing agents to save the buyers agent commission.

This attitude is not only wrong it is completely goofy. OK, maybe not Goofy but delusional. A listing contract with a seller and a brokerage spells out the amount of commission to be paid on the sale of the property. It is a contract between the parties of Seller and the Listing Agency.

In that Listing Agreement (at least here in Texas) there are specific terms of what constitues a sale. AND there are specific terms of how much percentage of the sale will be paid to the Listing Agency and the Selling Agency (the buyers agent).

Some agreements can say if the Listing Agent is the Selling Agent the commission can be some less. Many agreements do not say that. The agreement is between the Seller and the Agency of Brokerage, it is not a public document.

On the MLS sheet there is a Buyers Agent percentage listed that will be the buyers agent fee. Often it is 50%. Again, this amount is specified in the ORIGINAL LISTING AGREEMENT.

A sales contract is a contract with a BUYER to a Seller. In Texas, the Sales contract does not Address the commission between agents. The ratification page discusses that and it is not a part of the Sales Contract.

In essence a buyer who thinks he may save money by-passing a Buyers Representative is sadly mistaken. Somewhere there is a person getting paid that portion of the LISTING AGREEMENT. IF you are being offered representation and you decline it that is certainly your choice and it is totally legal, but do you really know that you are giving up the most powerful part of your negotiations? You are in essence showing a full hand to the Sellers Agent.

If you would like help with your Austin homebuying process give me a call.. I CAN HELP YOU.

Gail Tassey, Realtor® 512-217-9482.. http://austincomeshome.com