Unless you’ve been living under a rock, you’ve heard about the recent NAR lawsuit and its potential consequences. Here’s the short version: The way buyer’s agents get paid is going to change. Now, buyer’s agency agreements will need to be signed, commissions will need to be clearly disclosed ahead of time, and commission percentages won’t be advertised in the MLS. While sellers can still contribute to your commission, this rate is negotiable. When this news first broke, many buyers’ agents thought the sky was falling. However, now we know you can still thrive as a buyer’s agent in this market; you just need to adapt. Here are three steps you can take to make sure you get paid in this new landscape:
1. You need to prequalify buyers now. Just like before, buyers will start their home searches by calling agents. This is where you can use the LPMAMA script to set up an appointment time and secure their business. If you don’t already know, the LPMAMA script is a tried-and-true script that reminds you to hit the key points on the phone to prequalify your buyer and set an appointment. It stands for Location, Price, Motivation, Agreement, Mortgage, and Appointment. By asking the buyer questions about these items in order, you can focus on your buyer’s wants and needs before discussing ability and what they need. Reach out if you have further questions about this script.
2. Your clients need to sign a buyer’s agency agreement. Now that you’ve set an appointment and secured a relationship, you need to get your client to sign a buyer’s agency agreement. Many agents used these in the past, but they will be required in the wake of the NAR lawsuit. This covers what services you will provide and how you will be compensated for those services. It also gives you exclusive rights to represent your client. These are no longer optional; you need to get your buyer to sign one if you want to get paid.
3. How to make sure you get paid. After the NAR lawsuit, there will need to be much more communication between the seller’s agent and the buyer’s agent. While you are entitled to a certain fee, as spelled out in the buyer’s agent agreement, the seller may or may not cover some of that fee for your buyer. Here’s the good news: These commissions can be rolled into the mortgage, which will make negotiations much easier. However, you still need to communicate and negotiate with all the parties involved to make sure you get paid what you are owed.
Remember, the exclusive buyer’s agency agreement makes sense to your clients when you explain it in plain language. You need to practice getting comfortable asking clients for a fee; it won’t be guaranteed anymore. Call or email me if you’d like to practice role-playing this scenario or if you have any questions about this topic. I look forward to hearing from you!
