Buyer-Broker Agreement in St. Joseph & Elkhart: What to Know

by Timothy Vicsik

Do I Need to Sign a Buyer-Broker Agreement When Buying a Home in St. Joseph or Elkhart County, Indiana?

Buying a Home in Indiana

If you're preparing to buy a home in St. Joseph or Elkhart County and wondering about the current process for working with a real estate agent (Realtor), here's what you need to know. Starting mid-July 2024, a new policy from the National Association of Realtors® (NAR) requires agents to secure a signed buyer-broker agreement before assisting buyers.

This policy ensures:

Clarity: Clearly defining the agent-buyer relationship and outlining agent fees.
Commitment: Prohibiting agents from showing homes without an official agreement.
Transparency: Setting clear expectations for services and compensation.

While these stipulations have already been standard practice in many places, including Indiana, this nationwide policy strengthens transparency and ensures that all parties are on the same page from the outset.

What Is a Buyer-Broker Agreement?

A Buyer-Broker Agreement is a contract between a homebuyer and a real estate agent that outlines the agent’s duties, compensation, and the buyer’s obligations.

Here’s a closer look at its key elements:

Establishing a Working Relationship
Signing this agreement formalizes your partnership with your agent. It legally obligates the agent to represent your best interests during the home-buying process — from negotiations to market analysis and paperwork guidance.

Seeking more information about buying or selling in Indiana? Check out these helpful resources:

Compensation Clarity
This agreement specifies how your agent will be compensated, typically through the seller’s commission, meaning no direct cost to you. However, in cases where the seller doesn’t offer a commission, the agreement may require the buyer to pay. Reviewing this section carefully helps you understand any potential financial obligations.

Exclusivity
Most buyer-broker agreements are exclusive, meaning you agree to work solely with that agent for a specified time. This benefits both parties — your agent commits fully to your search, and you gain dedicated service. Non-exclusive agreements exist but are rare.

Scope of Representation
The agreement outlines the agent’s duties, such as finding properties, negotiating offers, and providing market advice. It also specifies your responsibilities, like maintaining communication and honoring scheduled showings.

Cancellation Terms
The agreement includes cancellation terms, ensuring flexibility if the partnership doesn’t work out. These terms protect both parties and ensure you can terminate the contract under specific conditions.

The New NAR Policy and What It Means for You

The new NAR policy introduces significant changes for buyer-agent relationships. Agents must have a signed buyer-broker agreement before showing properties, ensuring transparency and clear communication about services and compensation.

Another notable update prohibits the display of buyer-broker compensation on Multiple Listing Service (MLS) listings. Instead, compensation is negotiated directly between the buyer, seller, and their agents or arranged through seller-offered concessions like closing cost support.

These changes reflect a broader industry shift toward transparency, consumer choice, and clarity in real estate transactions.

Buying a home in St. Joseph or Elkhart County is a big decision, and understanding your rights and responsibilities as a buyer is crucial. For more on how the NAR settlement impacts homebuyers and sellers, visit their official page.

Tim Vicsik
RE/MAX 100
www.ND-Condos.com
Tim@TimVicsik.com
(574) 329-9587

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Timothy Vicsik

Broker Associate | RB14051798

+1(574) 329-9587