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Two Rules For Buying

By Judith Johannsen - published in The Hartford Courant, 5/15/2009

Here are two rules to remember when buying a house:

1) A buyer with representation has an educated agent working for them. This agent helps explain how to form and negotiate an offer and how to navigate the financing and inspection processes.

2) An unrepresented buyer is on her own.

A buyer is legally entitled to have representation, just like sellers are. The state’s real estate commission requires a real estate licensee to explain buyer representation to their clients and ask each buyer to sign an agreement before showing any properties.

A buyer who chooses to be unrepresented can see only the properties listed by a real estate company. A represented buyer can see that company’s listings and more.

Some buyers balk at signing a buyer representation agreement, mostly because they don’t want to sign a contract with someone they‘ve just met. Surprisingly, some lawyers (who apparently do not understand Connecticut’s real estate regulations) advise their clients not to sign. These lawyers must think this approach protects their clients, but in fact it forces them to go to every real estate company who has listings they want to see. This is not one stop shopping - it’s multiple stop shopping with many different agents. And most importantly, it’s shopping with agents who represent the seller’s interests, not the buyer’s.

Agents who fail to explain buyer representation do not understand their basic legal obligations. And, agents who show properties listed with other companies without a valid buyer representation agreement are violating state real estate regulations and risk being fined or losing their license.

A buyer who chooses not to be represented but wants to see a company’s listing anyway will be asked to sign a disclosure notice (not a contract).

Judith I. Johannsen is assistant counsel for the Connecticut Association of Realtors Inc. Connecticut Association of Realtors Inc. is Connecticut’s largest professional trade association representing more than 18,500 real estate professionals engaged in all aspects of the real estate business. Founded in 1920, the association is dedicated to enhancing the ability of its members to conduct their business successfully while maintaining the preservation of private property rights.

The use of the term REALTOR is exclusive to the members of the REALTOR Association and signifies their allegiance to a strict Code of Ethics.