There continues to be debate across the country about whether real estate agents should use a buyer representation agreement (BRA) prior to working with buyers.

Some agents say that they would never sign one and have long relied on the trust and the relationships that they have established over the years. They are not concerned with a customer using their services and then later trying to avoid paying them by going directly to the seller or to the listing agent.

Others state that due to the time and financial commitment they are making to buyers, they want to have the BRA signed by the prospective buyers to demonstrate that same level of commitment to them. Others state that they only sign the BRA at the time the first offer is presented.



Based on recent case law and public reaction to buyer representation agreements in general, here are five things to remember:

1) It is hard to claim commission without a signed BRA.

In a recent decision, an agent introduced a buyer to a property without a signed BRA. The buyer went directly to the listing agent and advised the listing agent that they were not working with any buyer agent. The listing agent then had them sign a BRA with them so they were acting in dual agency, or multiple representation.

The listing agent received the full commission payable. The buyer agent sued the listing agent for “unjust enrichment”, stating that they had done the work in introducing the buyer to the property and deserved to share in the commission. The court disagreed, stating that without a signed BRA, no claim could be made.

2) Can a buyer agent sue a buyer directly when no BRA is signed?

This is a difficult area of the law. With no signed BRA, a buyer agent must do more than introduce a buyer to a seller or to a seller’s property. They must also participate in the negotiations for the purchase and have an expectation of being paid commission. Without this, it will be difficult to claim commission from the buyer.

3) Is taking a buyer to court for commission a good idea?

I always try and discourage people from going to court, for the simple reason that decisions are made public and are then shared on the Internet. In a recent case, a buyer brokerage was successful in collecting $12,000 in commission against a buyer who signed a 12-month BRA and then purchased a home during the holdover period. Although this was a good result for the brokerage, there was substantial negative publicity associated with this case, as the media reported that the salesperson signed the buyer to a 15-month contract without explaining it to him and collected commission even though he did not represent the buyer in the actual transaction.

4) What some buyers do to avoid paying commission, even with a signed BRA.

In my experience, buyers will state that they signed the BRA late at night, without any explanation, at the time the first offer was prepared, and that no copy was left with them. They understood that if the offer was accepted, the buyer agent would be paid but if not accepted, there would be no future obligations. This is also the subject of many complaints made to the Real Estate Council of Ontario, by buyers stating they were never made aware when they signed the BRA that the term would be for a minimum of six months.

5) How do I make sure I use the BRA properly?

It is better to properly explain the BRA and have it signed as early as possible in the process, preferably before you are about to prepare a first offer for the buyer. Do it the same way every time. This means that all terms of the BRA are properly explained, including the initial term and any holdover provision. The term of the agreement, even if six months or less, should always be initialled by the buyers, to make sure that it was properly explained.

Always give a signed copy of the buyer representation agreement to each of the buyers immediately upon signing. When you explain agreements carefully, buyers will be less likely to try and avoid paying you commission.

By understanding your rights and obligations regarding the BRA, it is hoped that it can be used as a source of building loyal client relationships and protecting your commission at the same time.

32 COMMENTS

  1. “toprodcr”, I encourage all readers to accept and embrace your ideas. Now that I operate a 3rd. party business outside of the governance of registration, there is nothing better for my company than to see a Buyer Registry become the defacto standard for Registants.

    A Buyer Registry would open yet another dozen opportunities for your associations to be exposed to risk and tremendous opportunity for 3rd parties to attack.

    I suspect in fact “toprodcr” is a non-registrant paid staff from TREB whose staff has been trying to CON membership into embracing their registry service and are singularly focused on making it mandatory just like the Seller Contracts.

    I encourage all TREB members to rise up and demand a BAA registry ( better yet BRA Registry) receives mandatory consent from membership vote.

    I know the non-registrant public shareholders of the Major Franchise Corporations really want you folks to be foolish enough to get a Registry going too, as it would allow Franchise Fees to increase as well.

    • Ross:
      You have given a very interesting perspective, thank you.
      I cannot think of any benefit a buyer database would have for members.

    • Haha. So wrong. I am a lic Broker with 20 years experience as well as having worked in the public sector( municipal, provincial and federal) as has been mentioned in another post; some forward thinking provinces have already adopted mandatory agreements. Ontario is just slow to follow and Realtors typically abhor change. Remember electronic lockboxes?

      • I encourage all MLS systems to embrace electronic lockboxes and to sign agreements with these American companies to empower the members of your associations. I was so stupid when I was a member of the committee determining if mandatory or even optional electronic lockbox services provided through the conduit that was my local MLS, that I actually asked the Questions that through the answers provided by Supra and the others proved the risk those providers were causing MLS systems in Canada who used them.

        I was stupid I should have kept my mouth shut and allowed the Board to commit 1/4 of a million dollars and years of additional compulsary monthly payments to those companies. I should never have revealed, detailed and proved FINDERS FEES were being paid by these companies to Board staff in order to get their business or that those under table disclosures could be found right on those companies websites.

        Toprodcr I suspect bringing up electronic lockbox contracts for entire MLS systems only means you are in fact an paid staff on an MLS system currently looking to set up electronic lockboxes and YOU are the one getting the under the table referral fee.

        Sure give ComFREE and all the mere posters in your board/association bulk discount access to electronic lockboxes asking all your members to financially commit to support those FSBO companies and 3rd party tech companies attacks on your business for even less and less dollars.

        My company will simply inform any seller using an electronic lockbox supplied by an MLS of the PIPEDIA breaches their listing agent just made. Alongside of a RECO compliant way of having their listing terminated and the way a consumer complaint needs to be laid as a result of non-disclosure.

        Thank you Toprodcr your work for TREB is awesome.

    • Typical old school dinosaur thinking only of cost rather than benefit. Maybe you should write to the Alberta and BC re associations telling them how wrong they are. I am not going to be dragged into any more conversations with you as you are a conspiracy theorist

        • Electronic Lockbox use requires a series of permissions be authorized which violate PIPEDIA requirements unless Sellers and Buyers have been fully informed of what the ekey or iSupra useage requires.

          Android and IOS ekeys all require extensive permissions for both the homeowners and the agents data be released to Supra. No conspiracy theory here simply read the settings you agree to before you click install.

          By tracking lockboxes on Google Supra authorizes Google to utilize all the information about showings on all electronic lockbox homes.

          Remember when agents on your mls were caught selling new listing addresses to moving companies?? Do you wonder why your sellers are being called for all types of moving services the moment that electronic lockbox goes on??

          Again don’t believe me simply call the Privacy commissioner in your home province, tell them what and who you are giving this information to and ask them what written authorization you need from your sellers.

          I did an our MLS did not get electronic lockboxes. Maybe they have now because that referral fee was almost as good as Point2’s

  2. This should be a fairly simple discussion, as we are encouraged to work with contracts regarding our activities, and representing Buyer’s is an integral part of what we do. Contracts are, by their very nature, intended to remove the potential for any misunderstandings, and that should always be a positive thing towards enhancing an experience to feel like a professional one. Should there be shortcomings in a, current, industry (standard form) Contract, then the best way to expose any flaws is by using it, and getting feedback. A Buyer Representation Agreement (BRA) sometimes known as a Buyer Agency Agreement (BAA) — should be no exception to this. Is there a single Industry Form or Contract that hasn’t evolved over time, to become a stronger or clearer document? Current concerns should be brought to a “Forms Committee”.

    The proper use of Buyer’s Agreements can only serve to ultimately make us more accountable to consumers. When these Agreements are recorded and filed with a practitioner’s brokerage, it also increases the potential opportunity for the Managing Broker to have a higher level of awareness, of this aspect of a registrants activities. When Buyer’s Agreements are used, they should motivate the practitioner to have a keener sense of when they may be exposing themselves to a potential conflict of interests, as a result of trying to juggle several Buyer’s simultaneously — who may all, in fact, be looking for largely the same home, in the same neighborhood. How many real estate practitioner’s have ever turned down a new Buyer prospect, because they realized they already had clients looking for a home that too closely fit, the same criteria?

    A Buyer who signs a Buyer’s Contract, is more likely to be truly proactive, and have made all the proper financial arrangements to be able to finalize a purchase. And they’re more likely to be serious about buying in the near future. How many real estate practitioner’s have shown properties to Buyer prospects who weren’t properly pre-qualified, and how many have even written offers for such individuals? We have an obligation to make sure whenever we show someone’s home, we are as sure as we can be that the Buyer(s) can likely complete a purchase.

  3. I have the pleasure of being a bit on the inside of Agency in BC. I am privileged to sit with Brian Taylor of Bull Houser Tupper law firm when developing courses. Listening to him speak about best practices, he basically says every buyer should demand their agent use a BAA.

    This is what the council has been told by the public they wanted and the council has told Realtors they need to deliver. But remember the BAA works for both client and the Agent.

    Have alook at this article from Alberta. where BAA’s are mandatory.

    http://www.edmontonjournal.com/touch/story.html?id=9916179

  4. Simple solution. Make the BAA mandatory. Have each board’s mls create a database of registeted buyers(mandatory) and create a mandatory acknowledgement form to prove a buyer received a signed copy of the agreement and when. I have been asking for this over 10 years and it is still not done and there are still problems.

    • toprodcr:
      Unfortunately, your simple solution is not so simple and not so necessary.
      These are the reasons why I think that way.
      1.) purpose of the BAA is to have a written contractual agreement that states what obligations the Realtor and the Consumer have, in addition our code of ethics “requires” it.
      2.) most boards have reverse prospect match, to help match buyers with properties, and creating a database would be duplication and waste of money for the boards
      3.) you don’t need to re-create the form, showing buyer has received a true copy, because the buyer has to sign an acknowledgment on the existing form.
      Sincerely,
      Rita Giglione, Broker
      Royal LePage Exceptional Real Estate Ser
      http://www.ritagiglione.com

      • buyer database on the board site is voluntary – my proposal is mandatory. that way it is easy to see if a buyer is already signed up with another agency. You clearly missed my point as I am advocating mandatory not voluntary. your answer is frustrating to me as that is exactly the mindset I am trying to change but obviously you have formed an opinion which sounds unlikely to change. I just hope new realtors entering the profession will not have the same dinosaur attitude. BTW I celebrated 20 years last month as well as being a Broker so I DO KNOW a little of what I am talking about. Save you ethics issues for someone who cares (but obviously not enough to make change)

        • toprodcr:
          Re: Buyer Database
          I don’t think making it mandatory, just to verify if a buyer is signed up with another buyer is compelling enough reason. Most professionals establish this with buyers before they start to work with them.
          Besides, I would guess that most Realtors get the BAA signed the same day they get the offer signed.
          Now only if Realtors can understand that when they work with sellers they get a LISTING SIGNED, likewise, when they work with BUYER CLIENTS they should get BAA signed. Imagine trying to sell a home without a listing contract, never heard of it.
          I also have a long successful history in real estate, and continue to enjoy it. http://www.ritagiglione.com
          As far as ethics are concerned, they are one of the cornerstones of our success.
          Sincerely,
          Rita Giglione, Broker
          Royal LePage

    • There’s absolutely no need for a mandatory database, not to mention the myriad of issues, management and regulation that it would create including the membership complaints about the waste of money.

      Again, a BAA shouldn’t be about locking a client down even though that is a part of it. Its about communicating what each others role is, it’s about creating transparency and it’s about a higher level of professionalism.

      The number of clients jumping ship are fewer today because we as an industry are improving our STANDARDS. The higher those standards the less we have to worry about these types of clients. But the numbers didn’t even warrant this type of database then and they sure don’t warrant one now. It’s a bad solution to a small problem.

  5. I am sorry, but some are missing the main point.
    Getting a Client to sign a BAA before signing an offer, is a “requirement” that ALL Realtors have.
    I do not work with buyers unless BAA is signed.
    RECO CODE OF ETHICS
    Section :14
    “If a Brokerage enters into a buyers representation agreement with a buyer and the agreement is not in writing, the brokerage shall, before the buyer makes an offer, reduce the agreement to writing, have it signed on behalf of the brokerage, and submit it to the buyer for signature”.
    Sincerely,
    Rita Giglione, Broker
    Royal LePage
    http://www.ritagiglione.com

  6. Mark, terrific article on the subject with great points to keep in mind, thank you. I generally agree with Brian Martindale when he comments on stories, this is the first time I must completely disagree with him. In Brian’s thought process why would he even sign Listing Agreements with his sellers? I have been using Buyer Agency Agreements since 1995 and teach classes to real estate agents on their use and how to incorporate them in their business model to increase the level of their professionalism. The key here is to increase the level of professionalism and bring even greater value to the home buyer. It is NOT about us, it is always about the client….plain and simple and a Buyer Agency Agreement defines the agreed upon terms of the relationship which can only be a benefit to both parties. If an agent uses them to simply “list” a buyer they miss the professional aspect of the use of it, if an agent uses the agreement to provide clear understanding of the responsibilities of each party they are in my opinion raising the bar of our profession and how can that be so bad. In my classes, I show how the buyer client will benefit from engaging an agent and committing to the agent as the agent in turn is committing to them. In fact, if an agent uses an agreement and fails to perform, they can be sued for breach of contract so any agent intending to tie up a buyer with one is setting themselves up for trouble. In the 20 years I have used them, I have had a few that I could have sued and did not as it is not worth the bad karma that goes with it. In the same 20 years of using them, I have had most every client wow’d by the whole process and referred others to me that expect to sign one even though in my market I would think around 5% of the agents currently use one. I do agree with Hard Working Realtor’s comments sans the commission part. The agreement between an agent and the client is between them and them only, and the buyer client can top up the commission if the agreement provides for that but at least in my jurisdiction, whatever is paid out to a coop agent is what is paid out. The fact is it is not about the commission, it is about the service….the service and value we provide to a client before we receive dollar #1 and we provide so much knowledge and expertise with no retainer or fee so if we wish to be considered a Professional we must act like a professional.

    • Hi Jeff:
      I understand what you are saying and where you are coming from on this issue. But this particular issue is tied to the cold hard reality of there being too few registrants like you (and a few others who have commented herein on this subject, both pro and con vis a vis my opinion) out there, but far, far too many unlike you (the incompetents, the ethically challenged) out there which the public in general does not want to be tied to on a contractual basis when looking to buy vs. sell. It is the vast majority of the public’s preferences that we should be paying attention to and not just industry insider’s (our) ideas when it boils right down to satisfying our benefactors’ expectations. What ‘we’ think should be the way to do business (as we debate amongst ourselves) with consumers does not hold much weight with most consumers as evidenced by the low regard with which we are held throughout the population. If there were only one-third the number of registrants in the field, and they all were actual professionals in behaviour and attitude, then the BAA could work well for all concerned in my opinion. But that is not the case. My oppositional opinion is based upon the current state of affairs regarding the highly overpopulated membership. Sadly, this service vocation/business has almost always been overpopulated.
      You are a teacher and you must defend what you are teaching. Using the BAA has worked for you and your clients, and I am quite sure that using the BAA has worked for other registrants and their clients as well. But I would wager that those numbers are a very small minority (you say about 5%). Therefore I would submit that you are a member of the small minority of actual professionals in your geographic area. But you and ORE want the skeptical public to put their trust in all the rest of the registrants just as they do you, and the public suspects that the majority of registrants are not trustworthy enough to do so. Whether the public perception is right or wrong on that score is irrelevant, because in human affairs perception is reality. It is the public sentiment that we must pay attention to, and not so much our own.
      The skeptical public does not believe that most of us do much of anything for them as buyer representatives unless we are guaranteed a commission, and even then many think that we do very little, and you know as well as I that that is often the case. That embedded psychology of industry distrust is what leaves a bad taste in the publics’ mouth. Telling the public to sign this contract with us because it is an industry requirement and/or we will not work with them isn’t going to change public opinion on a scale large enough to change the negative optics in favour of winning public support for our vocation. We are too far gone, thanks to the powers-that-be in their ivory towers who have their concepts of what we should be doing locked-in from fifty years ago. The old-school “lock ’em up, sell, sell, sell, collect those commissions and keep those mega-dollar-dues-dollars a rollin’ in from as many of you registrants as we can dupe into jumping onto the merry-go-’round” mentality is the foundation upon which public distrust of us as an industry is based. Injecting more professional-style documents into the mix will not work until there is only a limited number of actual professionals offering up those documents, and I don’t see that happening any time soon.
      I used to use the BAA, but only after an Agreement of Purchase and Sale had been inked by all parties to the transaction and the deal had gone solid. Then my clients (who had become my clients via ratification, which is legally binding) felt very comfortable signing same.
      I believe you to be a professional Realtor, as do I believe the same of others who contribute herein, but for the majority slashing about out there who ‘do’ use the BAA as a tool to tie buyer clients up for far too long (six months and more on end)…no way. If a Realtor is quite confident of his/her ability to get the job done, he/she need only ask a potential client to sign the BAA to be in effect for thirty days, and if satisfied with that Realtor’s performance at contract’s end then, another thirty-day BAA can be signed, and so on if necessary. That would be the ‘only’ way that I could currently support the voluntary use of the BAA…by true professionals only, and that eliminates the majority of registrants currently licensed in my opinion. Ergo, I remain in opposition to potential clients across-the-board being influenced to sign a BAA at all, because the odds are that the registrant trying to tie that consumer up is not a professional worthy of that contractual obligation. That is also what the public thinks en masse. The public does not care what we are told to think of ourselves by our managers/trainers, CREA and ORE in general, and that is what we have to focus on going forward. We are thinking too much about our own interests as we try to convince everyone that that is not the case at all. We are fooling ourselves. We are like the contemptuous inward-looking Roman Empire just before the Mongol hoards steamrollered it into oblivion. All the good guys/gals went down with the old guard. The Mongols didn’t care.

      • Brian, thank you for your reply to my comment, I have always respected your comments over the years in other articles and highly agree with your response now. I feel the fault lies in how our industry has a low threshold for entry and how brokers want their desks filled with agent inventory rather than a high level barrier of entry and brokers selectively hiring agents. There are many quality licencees out there with a small number that hurt our public experiences and I would hope that eventually these damaging licencees will be filtered out.

        The consumer as well bears responsibility in interviewing their agent and those that offer value and experience would then succeed. This is a difficult subject as ultimately it is all about the consumer and until we as an industry move past the “list-em” mentality to the “professional” attitude, things will remain the same.

  7. Now 20 years later and still confusion exists on what is and is not legally allowed by Registrants.

    Registrants are prohibited from using the Offer to negotiate commission. In early 1995 the Registrar realized a “flaw” in the legislation and using the Code of Ethics removed the ability of the Buyer Brokerage to negotiate commission/fee payments duly authorized by the Buyer from being part of the Offer Negotiations.
    In recent years RECO created a new form that was another work around, yet not supported by the Act, in order to address ComFREE and mere postings to ensure the Code of Ethics was not being violated in RECO’s sole and absolute opinion.

    Since Mid-1995 Registrants have been expressly prevented from using the Offer to negotiate fees and that includes altering Co-Op fees used to satisfy BAA.

    This move by RECO has disenfranchised every Buyer and caused serious financial hardships on Buyers by requiring CASH instead of financing to satisfy many BAAs. So the question remains why has ORE universally remained silent on this issue?

    Finally I am so happy to see the term BAA being embraced by the community instead of BRA.

  8. The BRA is not to be feared or maligned or understated. Anyone working without one is a fool and will quickly see their business take a turn for the worse. They are absolutley necessary in this environment of discount commissions brokerages and “mere postings”. There is nothing more detrimental to your income stream than spending hours, weeks, months working with a buyer only to find the perfect home but…wait for it, the commission being offered is $1.00 or some other inadequate. Good luck trying to retrieve your hard-earned commission from either the seller or buyer at that point. I don’t care how loyal your buyer appears to be (they may even be family), you ain’t going to collect. Having the conversation up front, explaining your value for the fee paid, makes things very comfortable. Without a BRA you risk working for free or for very little in return for your time. It’s very easy to give your buyers an analogy using their own line of work and they quickly get it. Don’t want to sign? NEXT!

    • Western Realtor:
      This fool never used a BAA and never had the rug pulled out from under him by any of his clients. His business never took a turn for the worse. He never looked at his chosen occupation as a Realtor as being an “income stream” producer. He actually offered to help Realtor-skeptical folks with their real estate concerns by giving advice about how to navigate buying or selling ‘without’ a Realtor if they felt up to the job. Some of them immediately changed their minds and decided right there on the spot to work with him. This fool knew that to display an altruistic nature to consumers would result in business flowing his way sooner or later and that displaying a commission-guaranteeing-centric attitude would turn off some.
      The BAA is designed by its use to nab everyone’s wallet in the bud, whereas this fool’s non-manipulative way was simply to extend a helping hand to everybody, whether or not everybody was inclined to be locked up with a commission-hungry salesman. Yes, I worked for free now and then; so what? I never worked with only one client at a time; I usually had numerous clients and many more potential clients on my mind at any one time. I never counted dollars per hour in my mind, calculating if I was working for nothing or not. People showed up at my kiosk out of the blue asking for my advice because they had been talking with friends, relatives or neighbours who had spoken about my generous offering of my time and expertise. What goes around comes around. You can’t guarantee that by utilizing straight-jacket contracts that people have to be talked into signing my friend. You are a dollar counter, not a satisfied consumer counter, and that is the problem with the overall mindset of Organized Real Estate, starting from the top on down. It is a handed0on-down pernicious entitlement psychology that has been embedded within the communal psyche of the real estate community for ever. This fool had to be steadily on guard not to be sucked into that vortex of thinking and acting against his natural way of being, and I am glad that I was an outsider in that regard.

  9. I disagree with Brian that the BAA is so bad. Like any tool, when used correctly it’s a very effective document. And just as agents might take advantage of their buyers so too will buyers take advantage of us without one.

    It’s a great way to sit down with a potential client and define each others expectations. This can be done in a very professional manner and for my company it also acts as a filter ensuring we are spending our time with the most serious of clients. And hey, if they’re not comfortable they can simply move on…no harm no foul.

    But where Brian is correct And where I’ve seen misuse is when agents use the agreement simply as a means to secure higher than posted fees. And often it’s done on the sly.

    Agent to the Buyer; “So my fee is 2.5%, but no worries Mr or Mrs Buyer, my fees are taken care of in the transaction by the seller”.

    Agent to the Listing Realtor; “as you see in the agreement I have a BAA that states I get paid 2.5%”

    The honest discussion about fees is still not happening nor is there anything that states whether or not the buyer has been made aware that listing may not offer what is deemed to be “traditional fees”.

    So yes I agree with Brian on this. It’s seems the industries intentions are good, but as we take a step forward, seems we can often fall back two or three.

    • Hard Working Realtor:

      Your comment ” Agent to the Listing Realtor; “as you see in the agreement I have a BAA that states I get paid 2.5%”
      The BAA is between the Buyer and Buyer’s Agent. If the Seller was offering less than 2.5% selling commission, then your Buyer has to pay you the difference.
      It has nothing to do with the Listing Agent.
      Sincerely.
      Rita Giglione, Broker
      Royal LePage Exceptional Real Estate Ser
      http://www.ritagiglione.com

      • Exactly Rita that’s the whole point. But has the buyers agent discussed “the what if the fee or commission being offered is less than what’s stated in the BAA?

        Is the buyers agent using that agreement to avoid properties offering less than what is stated in the BAA?

        Has the buyer been told they may have to make up the difference?

        It’s not as simple as signing an agreement, it’s about ensuring that those signing the agreements understand the full implications of signing such an agreement.

  10. As Realtors we are required to get a Buyer Agency Agreement signed by our Clients at the “earliest opportunity and before an offer is signed”.
    That is how I explain it to Buyers, and they understand it and sign it….and it is also easier, once rapport has been established.
    Sincerely,
    Rita Giglione, Broker
    Royal LePage Exceptional Real Estate Ser
    http://www.ritagiglione.com

  11. This whole jumbled-up Canadian real estate transaction industry, as overseen and governed by a hodge-podge of national, provincial and local boards’ salaried bureaucrats (who operate in a vacumn without accountability to its dues payers) and elected short-term registrant volunteers from the trenches, remains mired in a constant state of amateur-hour disarray of contentious issues (as highlighted by Mark’s words on this issue ), which is only one contentious issue in Pandora’s Box of many others.
    For the record, I refused to trot out the BRA whilst meeting with potential clients. The last thing that I wanted folks to think about me as a person (quite aside from being a Realtor) was that I was right-off-the-bat trying to tie them up contractually with me for a stipulated period of time within which time period they might change their minds about me and want to go elsewhere, but that they would nevertheless be bound to me for potential financial compensation for thereafter doing nothing other than talking them into signing “right here on the line”…the BRA. My attitude was that if I could not conscientiously present myself as a trustworthy and knowledgeable advocate, and thereafter perform my duties as expected by my clients-by-ratification going forward on a continuing basis, then I deserved to lose the loyalty of those folks, bearing in mind that there are always fickle people out there. That kind of nothing-is-guaranteed forward-thinking mindset is what keeps us on our toes and stops us from taking folks for granted.
    Taking clients for granted is much easier to do if we have them legally contracted to us. I would submit that convincing folks to sign a BRA allows one to ignore clients here-and-there, to put them on the back burner so to speak, whilst pursuing new clients in order to build a repository of contracted-for almost-guaranteed business/future commissions. The negative psychological aspect that the BRA injects into the equation left a bad taste in my mouth from the very minute I was made aware of its existence. There is a valid reason why I continue to feel that way.
    If there were seventy-percent less registrants in the field, and ninety-five percent of those remaining registrants were actually fit to be designated as “Professional Realtors” (there are always some bad apples in any barrel, professional barrels or not) then I would agree with the use of the BRA. As it currently stands, we have an over abundance of failures-in-waiting (remember Cliff Baird’s statistics whereby eighty-five percent of newbies who enter the fray today will be history within three years, and fifty-five percent of same will be history within ONE year?) who are being told by Organized Real Estate to lock’em-up via BRA contracts.
    Question: Why?
    Answer: So that when a signed-up client realizes that the ‘acting’ Professional Realtor, who, via initial-meeting orderly recitations of slick scripted texts in conjunction with implementation of psychological maneuvers (as learned either by design or by osmossis from in-house pros who employ such manipulative tactics without thinking as a general matter of being) is not what he/she originally appeared to be, that that client would feel duped and might want to escape the clutches of that sales person.
    “Professionals” who value themselves and their level of personal expertise don’t need a legal straightjacket within which to control their clients. If a Professional Realtor loses a client here-and-there for reasons that only make sense to those former clients, so be it. Thems’ the breaks; that’s life in the real world.
    When the above inevitably occurs, a Professional Realtor simply continues on with his/her day, reciting in his her head “NEXT!”, whereas an insecure commission-chasing sales person overtly constrains folks by invoking the terms of the previously signed BRA contract ‘against’ a client who might not have felt entirely comfortable with signing the BRA contract (unfortunately for him or her) in the first place or who was unaware of the ramifications of signing his/her rights to change Realtors away. The BRA contract removes the right for a signatory to potentially make a free choice to abandon that ship and its captain that he/she might misguidedly have signed on with. The odds are high that a consumer will have signed on with a rookie captain on a leaky ship, thanks to ORE’s keep-the-membership-ranks-chock-full-of-dues-paying-amateurs inward-looking self-serving policies.
    I don’t blame anyone for giving real estate a try under its current free-for-all arrangements, but I ‘do’ blame ORE bureaucrats for allowing just ‘anyone’ to give ‘er a try, and thence for trying to shove this BRA thing down their throats as a means for almost guaranteeing a commission in what should be a professional environment based upon a practicing meritocracy wherein nothing is guaranteed but one’s well-educated, well-experienced, advocate-based efforts.
    Now then, if the real estate transaction profession operated under other than a race-to-the-bottom commission-driven “We will perform best for the least!” (but don’t hold ‘us’ to that, but ‘we’ will hold ‘you’ to the terms of the BRA) model with a limited number of practitioners, the BRA would not be needed.
    The BRA appeals to the commission hungry types first and foremost. That personality type reminds me of a multitude of gulls screeching and fighting with one another as they descend on a garbage dump with each arrival of a garbage truck as it empties its load of gull-goodies. Too many gulls working the the dump and squabbles over food break out all over the place. Then a smart head honcho gull who gets a small piece of all of the action gets an idea. Have all of the gulls sign agreements with the truck drivers that guarantee that the drivers of choice will dump stuff only on each signatory gull’s personal piles of garbage as scattered her-and-there. Then those gulls can for awhile ignore certain piles that don’t have the probability of a quick feed whilst feeding off of fresh signed-for dumps all the while searching out new positions for piles-in-waiting. Voila, a professional pile-builder is born which can strategically wait until its various piles beckon here-and-there for attention as garbage mysteriously appears when signatory drivers inevitably dump stuff on a pre-existing contracted-for pile. The gull does not have to work as hard for his meals nor fend off competitors who likewise have their own piles under contract, and the drivers are not harassed by screeching hoards of poop-dropping hungry gulls as they exit their trucks.
    Dr. Seuss I ain’t, but I am realistic, thus skeptical, about underlying motives of hungry commissioned sales people and their industry gods.
    If you (registrants) want to help people with their real estate related concerns, if you know that you are competent enough to properly do that and thereby earn a living by doing so, then do that. You will always lose a few here-and there. It is within the natural order of things for that to happen, almost on a regular basis. However, if you are chiefly concerned with extracting the maximum amount of commissions from members of the public by contracted legal force, and you don’t care about what disillusioned former clients-who-have-been-forced-to-pay-up and members of the public in general think of you because, what the hell, there are millions more marks where they come from, then use the BRA. By doing so you will continue to brand yourselves as commission-sniffers who put money first, commission-providers’ concerns and feelings second.

    • You agree with getting the BRA signed once 80% of the competition have been removed. Optimistically it likely would not be needed if that were the case. The real issue here is not the registrants but the unintended consequence of the industry stacking dues paying realtors to the rafters for which an entire sub industry is now dependant. It would be interesting to know of the 110,000 Realtors how many people are employed directly in sub industry on salary, pensions and benefits are now dependant on those BRA producing commissions. I expect like a cruise ship its around 2:1

    • Excellent. My feelings exactly on this issue as well as the unnecessary bureaucracy created to supposedly govern the Real Estate industry.

  12. Hi Mark, Thanks for an enlightening article. certainly the negative media coverage aspect of BRAs, whether aimed at the buyer or the broker, plays a significant factor in how brokers will approach clients about signing the agreement.

    Should such a matter head to the courts, what are the liability issues, if any, that face both parties?

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