Kelly ( Kailash ) Awasthy Sales Representative

Kelly (Kailash) AwasthySales Representative

TheBuyerRepresentationAgreement

Who Represents the Purchaser?

Kelly AwasthySales Representative

DID YOU KNOW?Ontario Law requires the

PURCHASER’S AGENTto represent the SELLER

when NEGOTIATING an OFFER

Kelly AwasthySales representative

Did you know?The PURCHASER’S AGENT MUST

negotiate the highest possible price for the Owner

or the Purchaser’s agent can be sued

by the Owner!


Did you know?Ontario now offers the

PURCHASER a better OPTION!


THE OPTION?A

BUYER REPRESENTATION

AGREEMENT(B.R.A.)


What is a B.R.A.?A relationship by which the

purchaser enters an agreement with another party (The Agent)

to act on his behalf.


Costs to the Purchaser?There are no additional costs for

ANYONE!The Seller pays the Agents’

Commissions, as usual!


How does this affect the Purchaser?•His or her legal status is dramatically affected.•The purchaser’s legal status changes from

that of a “Customer” to being the “Client”• The “Client” has “Rights” to which a

“Customer” is not entitled.


What is the REAL difference?To whom the agent owes the duties of “Loyalty,

Confidentiality, and FULL DISCLOSURE”!With this Agreement in place, they are OWED by the Agent to the Purchaser,

rather than the Seller.


What does this mean to a Purchaser?FIRST...• The Purchaser’s Agent is no longer obliged to disclose pertinent

information about the purchaser to the Seller, which could affect the

selling price.• By the time a purchaser is ready to make an offer the agent has

often gathered significant information that the purchaser would not want the seller to have.

• Information the Agent would have been obligated to disclose!


AND....With Buyer Agency (Representation),

the Purchaser’s Agent can now disclose to his or her Client (the Purchaser) anything about the Owner the Agent learns that might enhance the Purchaser’s, not the

Owners, negotiating position.


What else?Secondly...• The Purchaser’s Agent is now free (of liability) to negotiate

the best possible price for the Purchaser. To use his or her negotiating skills to assist the Purchaser to buy at the lowest possible purchase price.

• The Agent can now attempt to save the Purchaser Thousands of Dollars through his or her legal duty of “Loyalty” to the “Client”.


What are the Purchaser’s obligations?• To be a binding Legal Agreement “Something”

must be given in return for “Something” received.

• In this case, the only “Something” that the Purchaser gives in return is “LOYALTY” to their Agent.


What about the Commission?• The commission, as has long been common practice, is

paid out by the “Proceeds of the Sale”, as outlined in the listing agreement.

• When the lawyer collects the proceeds of the sale, he sets aside the commissions to be sent to the listing brokerage and distributed to the Buyer’s Agent from there.

• Since this does not at all affect purchase price, the question of who pays commission becomes irrelevant!


Why would the Owner agree to this?

The net result to the Owner does not change!

• The Seller still makes the final decision on what price they will accept for the property.

• The Seller still pays the same percentage of commission, and ultimately, still net the same!


The Advantages of Buyer AgencyBuyer Agency allows the agent to act in the Purchaser’s best interests in several areas including the following:

• Home selection• Negotiating price• Financing• Closing date• Disclosure


Home SelectionBecause of the Agents obligation, under

the terms of a B.R.A., to guide the Purchaser, not the Seller, he or she can now draw on the Agent’s knowledge to

advise the Purchaser on buying a particular home or of buying in a particular area.


Negotiate Price• The Seller may be willing to accept thousands less than

the Buyer is willing to pay.• For most Sellers, there is a range between what they ask

and what they hope to get.• However, in many cases, there is another price: The price

the Seller is willing to accept!• With Buyer Agency, the Agent is empowered to negotiate

the absolute best price the Seller will accept.


Clause Selection• Without Buyer agency, the contract, by law, must be

written “in the best interests of the Seller.”• However, there are several clauses that should, from time

to time, be included, such as a Home Inspection, Termite Inspection, Environmental Inspection that may not be beneficial to the Seller.• With Buyer Agency in place, the contract must be written

in the “best interests of the Buyer”!


FinancingThere may be certain financing available such as

Seller Take Back, that may save the Buyer thousands of dollars that the Seller may not appreciate, however be willing to accept. By

having Buyer Agency agreement the Agent can explore these options.


The Closing Date• In a traditional Offer Negotiation, both Agents

work for the Owner and, therefore, try to persuade the Purchaser to accept a closing date suitable to the Seller’s requirements.

• With Buyer’s Agency, the Agent is required to negotiate the best closing date for the buyer!


Disclosure -The Single Greatest AdvantageWould it effect your Purchasing or Pricing decision if you knew:

• The Seller would accept less due to Financial difficulties• The Seller would accept less due to Marital difficulties• The Seller would accept less than Fair Market value for any other reason• You could purchase a Private for Sale in the area for less money• Future construction plans for the area• Factors which could positively or negatively influence the Future value of the area• Another property might be more desirable

With Buyer’s Agency, your Agent must, and will, disclose any such vital information or advice to which he or she has knowledge or access!


Why Buyer Agency?The Buyer’s Agent can negotiate a better purchase

price and more favourable terms.

The “best interests” of both parties, not just the Seller, are being protected.

Documents

Kelly ( Kailash ) Awasthy Sales Representative