Navigating Buyer Brokerage Agreements- A Guide for Home Buyers

Christian: [0:01] Hello there and welcome to another episode of the Awesome in Seattle podcast. This is your host, Christian Awesome, of the Awesome Nossum Group at Wilson Realty Exchange, Inc, and I am joined today by my lovely real estate agent extraordinaire here at the Awesome Nossum Group, Joanna Beecher.

Joanna: [0:16] Hi.

Christian: [0:18] Today we're gonna talk about something that's absolutely critical when you're buying a home, and that's the reason why you have to, by state law in the state of Washington as of January 2024, sign something called a buyer brokerage services agreement. Every single buyer, no matter what, has to sign one of these now, so this episode is all about that, and the first step in that is really choosing the right real estate broker to work with.

Joanna: [0:45] Yep. Okay. We all know that buying a home is a huge decision.

Christian: [0:50] Mm-hmm.

Joanna: [0:50] And when it comes to making the biggest purchase of your life, the last thing you should do is go into it alone. There's a lot at stake-

Christian: [0:59] Yeah … Joanna: financially, emotionally, and even logistically. So let's dive into why it's so important to have a trusted professional in your corner when buying a home in the Seattle area. All right. So first off, let's talk about the elephant in the room. Why not just go it alone? Do you really need an agent? After all, with all the listings online, and it feels like an endless resource of information that you can find online at your fingertips, seems like you could just navigate this on your own, right?

Joanna: [1:29] Ooh, okay. But here's the thing . Speaker: Here's the thing. Here's the thing. The real estate market is complex. Mm-hmm. Okay? There-

Christian: [1:38] To say the

Joanna: [1:38] least … yeah, to say the least. Yes. There are a lot of factors. Yeah. A lot of factors that go into finding the right home, negotiating the best deal, and making sure the entire process runs smoothly.

Christian: [1:48] Mm-hmm. That's where we come in. So as professional real estate brokers, we have over 20 years of experience here on the Awesome Nossum Group team. We know the Seattle area market inside and out. We've been through the ups and downs. We've been through fluctuating interest rates. We've been through the foreclosure crisis and the housing crash of '08. We've seen pretty mu- maybe not everything, but a lot of what's gone on- A lot … over the last 20 years. And there's a lot to n- to really unravel and understand, from the competitiveness of negotiations, the competitiveness of specific houses, having those relationships with other agents- Yeah … that we have, that they know how good of a job we do, so they want to accept our offer versus someone else. And you also gotta negotiate and understand all of the legal and financial details of a transaction.

Joanna: [2:42] Exactly. It's a lot more than just finding a property.

Christian: [2:45] It's way more than just finding… That's, like, the easiest, and actually, the most fun part.

Joanna: [2:48] That's the most fun part. Yeah. We love that part.

Christian: [2:50] Finding that part- But- … or the house is, is, is really easy.

Joanna: [2:53] Yeah. I mean, honestly, like, that being the best part, finding the house- Mm-hmm it's about protecting your interests and- Ensuring you make the best decision possible for yourself. Um, most people are just looking for what works for them.

Christian: [3:06] Mm-hmm.

Joanna: [3:06] And that's great, but buying a home is a lot more than that. It's about understanding more than just what works for you right now. A great broker will understand this part, while also helping you analyze how to not only buy what works for you, but what will help you get the highest return when you go to sell it again in the future. Mm-hmm. You know? Um, those are big pieces Just two of the big- Yeah … pieces of many that are really helpful to have somebody understanding that that's working for you on your team.

Christian: [3:37] Exactly. Let's not forget about the emotional side. Now, as a guy, I'm not, and you can ask my wife this, I'm not necessarily the best at emotions, but I have personally bought and sold numerous houses myself. I have helped hundreds, if not thousands, of probably over a thousand people at this point in my last 20 years- Yeah … buy and sell houses, and I fully understand the emotional side of buying a house. There is a lot of ups and downs, and having, uh, an agent on your team that understands those and can proactively help you understand those and inform you so that you know what's about to happen, so that you don't make some crazy, rash decision that maybe you shouldn't because you're just super excited and you wanna make this offer on this house, even though logistically, maybe this house doesn't make sense for you. So having that emotional rollercoaster, as we like to refer to it in our home buyer class- Mm-hmm … kind of laid out and understood, helps you get through the, the emotional rollercoaster of buying a house.

Joanna: [4:41] Um- Exactly … Speaker: we help guide you, we help keep you grounded when things feel overwhelming, and, you know, if you've come to our beers and home buying class, which, again, is totally free, um- And fun and fun, and there's free beer, so- Yeah … you can't really go wrong there. We talk about all the strategies that we use to help you navigate the highs and lows without losing your cool, and while making sure you make that informed decision. That's our goal at the end of the day. Yeah, and while it may feel like you can find all the answers to everything on the internet, uh, the truth is, it's hard to know who you can trust.

Christian: [5:13] Mm-hmm.

Joanna: [5:14] It's also hard to get specific area information.

Christian: [5:17] Mm-hmm.

Joanna: [5:18] Not only do the rules of buying a house vary from state to state, but also the customs vary from state to state.

Christian: [5:24] Mm-hmm.

Joanna: [5:25] Area to area.

Christian: [5:26] Area to area, yeah. That's why knowledge matters, and our team, we've seen it all, like we said before. We also have a ton of trusted advisors that we can recommend, from mortgage lenders to home inspectors that aren't gonna screw you over- Mm-hmm to movers, to title and escrow companies, and anything and everything else in between. We have- And

Joanna: [5:48] stagers.

Christian: [5:48] Yeah, stagers. Like, we have- Contractors … we have so many resources that we will gladly share with you when you're our client, because that's what you're gonna need moving forward. Absolutely. That's part of what you get when you work with us.

Joanna: [6:01] So- Why should you choose to work with us instead of trying to do it yourself? It's simple. You want someone who has your back.

Christian: [6:10] Mm-hmm.

Joanna: [6:11] Who understands the ins and outs, the customs, and who knows the current market conditions for your specific buying criteria. Yeah. Buying a home is a massive commitment, and having someone who's focused on protecting your interests and guiding you through every step of the process is invaluable. We never try to sell you anything- Nope … ever, and we're here to help you make informed decisions and find the home that's right for you. In fact, many times we find ourselves talking clients out of buying a home.

Christian: [6:41] Mm-hmm.

Joanna: [6:41] You know, if we spot red flags-

Christian: [6:43] Yeah … Joanna: we're not going to proactively push you to buy anything. No. We're gonna help you learn about those- Mm … and why it would be maybe a better decision to look elsewhere. Yeah, yeah, and we've talked so many people out of buying houses.

Joanna: [6:55] Mm-hmm.

Christian: [6:56] We're- we honestly talk a lot of crap about houses when we walk through them.

Joanna: [7:00] No.

Christian: [7:02] Pointing out the things that you should really be looking for- teaching you about those things, and making sure that you're not buying something that is not a good investment long-term for you. Yeah. Part of that, too, I- I'll just go off script a little, is selfishly, we want to, when you go to sell in 5, 10, 15, 20 years, we're still gonna be here, and we want to be able to have an easier job selling the house that we sold you. I've helped so many clients move up to their second, third, sometimes now fourth house in their lifetime, and you can't do that when you sell someone or hel- help someone buy a crappy house.

Joanna: [7:40] No. ' Speaker: Cause it's not gonna sell for very much. So we're always trying to help you maximize your investment so that when you go, when the house doesn't make sense for you anymore, and you need to buy that next one, you're gonna get the highest investment so that you can afford that next bigger house- Exactly that makes more

Christian: [7:54] sense for you.

Joanna: [7:54] We have clients come to us because they bought- Mm-hmm … a terrible house first, not with us- Yeah … but with someone else who didn't help them in the right way.

Christian: [8:03] Mm-hmm, yes. Yeah. All right. Plus, signing a buyer-brokerage agreement with us isn't about locking you in. No. It's about ensuring that you have dedicated support, and that we're working in your best interest every step of the way. It gives us the chance to focus entirely on you, whether it's finding you the perfect home or even negotiating the best terms.

Joanna: [8:24] Okay, so- Mm-hmm … this is kind of important.

Christian: [8:26] Yes.

Joanna: [8:27] What is in the buyer brokerage services agreement? Ah, yes. I wanna get into that.

Christian: [8:31] Yes, let's-

Joanna: [8:31] Okay … break

Christian: [8:32] it down.

Joanna: [8:32] Well, simply put, as of January of 2024, the State of Washington mandated that every real estate broker must sign a buyer brokerage services agreement with every client before performing any real estate-related activities.

Christian: [8:48] Mm-hmm.

Joanna: [8:49] The agreement lays out who you will be working with as your agent, how long you'll be working with them- How much commission they will get paid, and who will pay it.

Christian: [8:58] Yeah. So let's break down, uh, break that down a little bit more. So the first step is choosing who you will be working with as your agent/broker, and whether that's gonna be an exclusive or a non-exclusive relationship. Personally, we, when we're working with first or second-time homebuyers, we work exclusively with them. When it comes to investors, that's where most investors, I'm an investor as well, investors are working with whatever agent brings them the deal that meets their buying criteria, 'cause they've done this a ton of times. It's

Joanna: [9:30] not for their home home- It's not for their forever home … that they plan to live in forever. Yeah. It's just for, you know, financial-

Christian: [9:36] Mm-hmm … Joanna: purposes. But also, I wanna say- Mm-hmm … when we exclusively work with someone, the reason we really like to do that, which I think we just kind of explained in a roundabout way, was just we wanna make sure that you know that we are giving you everything we got. Mm-hmm.

Joanna: [9:50] And we want that from you, too. And if it's hard to commit to that, if a buyer is wanting to shop around on you-

Christian: [9:58] Mm-hmm … Joanna: I think everybody would know how that feels- That's not fun … in any circumstance. It's not great. So we wanna make sure that we're committed to each other for a really great process. Mm-hmm.

Joanna: [10:08] Yeah.

Christian: [10:09] Now, the next step is choosing a timeframe. Now, the default on the contract, on the Buyer Brokerage Services Agreement, BBSA, as we like to call it- Mm-hmm … is 60 days. We work with you to figure out that timeframe. We don't really necessarily care what we write on there. Often, we will just, by, by default on our team, we'll just say 365 days, because that way there's no pressure on you.

Joanna: [10:32] Yeah.

Christian: [10:33] Um, and if you need to take a break, or you don't want, you're not finding the house that makes sense for you in those 60 days, you're not stuck. You don't have to keep signing these agreements over and over again.

Joanna: [10:46] Now, this doesn't mean you can't cancel the contract. Mm-hmm. If you're not liking how things are going with us, or you don't feel like we're a good fit anymore-

Christian: [10:55] Mm-hmm

Joanna: [10:55] you can always do that. You can always cancel that. Yeah. That is a good thing to know. With any buyer brokerage services agreement, whoever you sign that with-

Christian: [11:02] Mm-hmm … Joanna: you can cancel it, okay? Yes. Moving on though- Mm-hmm … uh, the big, one of the big pieces I know everybody wants to talk about is for the commission that gets- Yeah paid to your buyer agent. Mm-hmm. Because we don't work for free. Hey, do you? Um. No. Anyway. No one does. So the seller technically pays for both the listing agent and the buyer's agent's commission. Now, is that negotiable? Yes, it is. Mm-hmm. Always has been, but it usually falls somewhere between 2.5 to 3% of the final sales price. Now, if the seller does not list that they are offering a commission to the buyer's agent, okay, that can still be negotiated into the deal, meaning that we will still figure out a way, hopefully, for the seller to pay it. Mm-hmm.

Joanna: [11:51] Okay?

Christian: [11:52] And sometimes the seller won't. So this law changed again January of 2024. We're the end of 2024 right now. I have not really seen, maybe in .1% of listings, where a seller isn't paying a commission- No … to the buyer's agent. Like-

Joanna: [12:10] There's only been a few times this year that I've even had to negotiate up on the percentage paid- Mm-hmm … like from a 2% that was offered up to a 2.5%.

Christian: [12:20] Mm-hmm.

Joanna: [12:21] So just know that it's, we can always talk through this. We can always work through negotiations to make something that works the best for you.

Christian: [12:30] Yeah. Yeah. And again, the majority of the time, if not all the time, can't say all the time, but majority of the time, the seller's still paying our commission. That's the way it used to always be- It was always negotiable, but it pretty much always happened. The same is pretty much happening now. There's no… We're not seeing it. I mean, maybe it happened in the future, but we're really not seeing that- Not yet … be an issue, and I don't really expect it to. Uh, it's actually in a seller's best interest if they wanna get their house sold-

Joanna: [12:58] Mm-hmm

Christian: [12:58] to offer that buyer-broker commission.

Joanna: [13:02] Quick reference to another episode in our podcast that discusses the history of this-

Christian: [13:07] Yes … Joanna: and why it's all turned out this way. Mm-hmm. All right, so if you're ready to take the next step in your home buying journey and you've signed that buyer brokerage services agreement and now you're like, "Hmm, what happens next? I wanna work with the Awesome Nossum group." If you've already come to one of our free beers and home buying classes, then you know that the next step is to schedule a free strategy session with us. Mm. You can do that right on our website, AwesomeNossumGroup.com/strategysession. If you haven't come to a class, you probably should.

Joanna: [13:39] Yeah.

Christian: [13:40] They're totally free. We host them every single month, different neighborhoods all around the Seattle, general Seattle area.

Joanna: [13:46] We'd love to see you.

Christian: [13:47] We would love to see you there. Um, they're usually at really cool bars- Breweries … or,

Joanna: [13:52] or breweries Restaurants. Yeah. Yeah.

Christian: [13:54] All sorts of different places, and the venue's awesome. The food, if they have food there, is great often. Free beer, that doesn't suck either. No. So- And- You can find out where we're doing our next class always- Yeah … at beersandhomebuying.com (opens in a new tab). And,

Joanna: [14:09] yeah, I mean, it's a great way to learn about the process- Mm-hmm … in a relaxed setting, get expert advice from- Mm-hmm … not only us cool kids, but a top mortgage lender.

Christian: [14:18] Yep.

Joanna: [14:19] And you can ask all the questions that you already have, or you'll come up with some, I guarantee it- Yeah … when you're at the class. Yeah. Um, but if you can't come to a class and you'd like to chat with us, either sign up for a strategy session or text or email or call us. I'm really good with texting. Mm. Our info is right on our website, AwesomeNossumGroup.com.

Christian: [14:39] Yep.

Joanna: [14:40] Mm-hmm.

Christian: [14:40] Very simple. Very simple. Yep. So if you were to sign up for a strategy session, that's where we're going to guide you through the entire process and help you build that roadmap. We don't care if your timeframe is, "I wanna buy a house next week," or, "I wanna buy a house in three years." Doesn't matter to us. We're just here to help you build that roadmap so you know all the steps you need to take- Mm-hmm … in order to meet your goal of buying a house in a timeframe that makes sense for you. We're, like we said before, we're never gonna pressure you to do something. It's really just helping you understand what you need to do to get there.

Joanna: [15:17] Exactly. And okay, I wanna say that- Mm-hmm … the biggest takeaway from this episode that we want you to get-

Christian: [15:23] Yep … Joanna: is signing the buyer brokerage services agreement with us isn't a big, scary thing. It is all about you- Yes … Joanna: and keeping this as transparent and fully informed of a process as we can. It's not about trapping you into- Mm only working with us. Um, our reputation -- Speaker: Yes … Joanna: is very important to us, and it's too important for that, so as is providing of awesome service- Mm-hmm … to you, our clients. So if you wanna check us out on Google, I mean, we may have a few pretty phenomenal reviews, I think. I think we have almost 100 or so.

Joanna: [15:57] Oh, stop bragging, Christian. Four or 500 reviews. I'm like, eh. You know. Okay. Yeah,

Christian: [16:01] yeah. Um, so yeah, when you're ready to start this next exciting, exciting chapter in your life, remember that working with a real estate broker isn't just about finding a property. It's about ensuring that you make the right choice, that you make the right decision, informed decision, navigating the emotional ups and downs, and really making this an entire process smooth and easy and as stress-free as possible. And we have, as the Awesome Nossum Group, created a pretty unique way of navigating this whole- Mm-hmm … entire process that works extremely well. Like Joanna alluded to, look at our reviews. We have tons of people that we've helped purchase a house that explain how our process works and how it's different than the majority of agents out there.

Joanna: [16:48] Yeah, and God forbid it actually also be fun.

Christian: [16:50] Exactly. We do

Joanna: [16:51] have fun. And it's fun.

Christian: [16:52] Yeah.

Joanna: [16:52] So yeah.

Christian: [16:53] That's it for this episode of the Awesome in Seattle podcast. Thank you so much for listening. I hope you got a lot out of it. I bet you did, 'cause we shared a lot of great advice today- Hope so … if I do say so myself. And if you're scared of signing that buyer brokerage services agreement-

Joanna: [17:07] I hope you're not anymore … Speaker: I hope you're not. Exactly. Yeah. But if you are and you wanna chat- Mm-hmm … Speaker: we will chat with you, answer any additional questions you might ever have. Just reach out. Yep. We already explained. Go to our website, AwesomeNossumGroup.com. All our contact info's on there. Yep. Happy to go through this and over this with you. And again, you will have to sign this with any agent, broker that you work with, no matter what, moving forward. So it's best that you understand it, that you can take the fear away by answering all your questions and understanding what it is you're signing and getting yourself into, and I hope this episode helped with that. Yep. Same.

Christian: [17:42] All right. Well, thanks for listening, and we'll see you next time on the- Thanks, guys … Awesome in Seattle podcast