|In Wisconsin, there are essentially four types of
agents. The first two are listing agents and subagents. As a
buyer, you should be aware that these "traditional"
agents have a legal obligation to loyally work toward getting the
highest price and best possible terms for the sellers.
Not too long ago, these were the only types of agents with whom
buyers could work. Fortunately, times have changed. Back around
1992, a third type of agent began to emerge and has since become
accepted in the Greater Madison Area, as well as in other parts of
the nation. This third type of agent is known as the buyer's
agent. (In Wisconsin, in the absence of a written agreement
between a buyer and a buyer's agent--not to be confused with our
state-mandated agency disclosure form--buyers are either
working with a listing agent or a subagent.)
The principal difference between the buyer's agent and all
other agents is that a buyer's agent has a legal obligation to
loyally work toward getting the buyer the lowest price at
the best possible terms. Everything that the buyer's agent does, except
in one particular--and frequently occurring--circumstance,
must be performed with the intention of creating the maximum
benefit possible for the buyer client.
This one exception occurs when the buyer's agent has requested,
and been given, contractual permission by their buyer client,
at the outset of the relationship, to transition into what is
known as a dual agent--which also happens to be the fourth and
final kind of agent recognized in Wisconsin.
With dual agency, also known as "multiple
representation," the buyer client agrees at the outset
of the relationship to allow their buyer's agent to stop
representing their best interests, if they wish to purchase ANY
home listed by their buyer agent's COMPANY. When this
happens, both the seller and the buyer have lost their advocacy in
the transaction as their former agents must then transition into
intermediaries in the negotiations, prohibited by law from giving
either party advice that would be detrimental to the other.
What makes dual agency most troublesome, is that you--as a
buyer--can never adequately judge how likely it is that the home
you may want to buy may be listed, or become listed, by the
company that is acting as your buyer's agent. Factually speaking,
the bigger the Company for which your buyer's agent
works--including all the satellite offices within that
company--the more likely that you will be thrust into a dual
agency situation and thus lose your advocacy.
Fortunately, there is a way to obtain buyer agency services,
receive full access to the real estate marketplace and NEVER have
to worry about the possibility of being drawn into a dual agency
situation and that is to retain the services of a very specialized
and rare type of buyer's agent known as the EXCLUSIVE buyer
Exclusive buyer agents--and the firms for which they work--do
not list houses, nor do they EVER represent sellers, so there is
absolutely NO possibility of a buyer losing their representation
due to the risk of dual agency. Exclusive buyer agents provide 100
percent homebuyer representation, 100 percent of the time.
Some of the other benefits that accrue to buyers who use
exclusive buyer agents, as opposed to buyers who are simply
customers of traditional seller agents, appear in the paragraphs
below. This list, though not all-inclusive, does illustrate many
of the prime differences between exclusive buyer agents and all
other types of agents in Wisconsin.
** There is no additional cost for using an exclusive buyer
agent over any other type of agent. The exclusive buyer agent is
compensated through the transaction in the same fashion as any
other cooperating broker who has brought a buyer to the property.
** Using a buyer's agent may very well save you money. A study
by U.S. Sprint (the long distance company) found that "232
relocating Sprint employees who hired buyer's brokers paid an
average of 91 percent of a home's list price. People who used
traditional agents typically paid about 96 percent. On a house
originally priced at $150,000, that's a difference of
$7,500." (Money Magazine, April 1993.)
** Besides those properties that are listed on a Multiple
Listing Service, exclusive buyer agents can seek out and represent
their clients on For Sale By Owner, Bank-Owned, and any other type
of property. An exclusive buyer agent can even contact every owner
in a particular neighborhood that interests the buyer-client, to
inquire whether or not the owner may be willing to allow the
buyer-client to view the potential seller's unlisted home.
** When viewing homes, one of the exclusive buyer agent's
obligations is to go beyond mere disclosure of adverse factors
relating to these homes and/or neighborhoods, to offering advice
to the buyer on how these factors may impact upon future resale or
relate to the buyer's current needs or desires.
** An exclusive buyer agent will provide their buyer-client
with a market value analysis, prior to that buyer making an offer
on any particular home, so that the buyer will have their agent's
professional, written opinion on the value of that home.
** When drafting offers, counter-offers or engaging in other
negotiations, the exclusive buyer agent must always be focused on
loyally advancing the best interests of the buyer.
Simply put, everything that the exclusive buyer's
agent does, must ALWAYS be geared toward creating the maximum
benefit possible, for the buyer client.
All of this could lead some sellers to believe that exclusive
buyer agents have a goal of creating a disadvantage for sellers,
when all the exclusive buyer agent is attempting to do is to
provide for their buyer-clients, the same type of representation
that had previously only been available to sellers through
traditional real estate agents. Exclusive Buyer Agents seek to
level the playing field for their buyers.
As consumers become more aware of the options that are
available to them when it comes to real estate agents, it would
not be surprising to see them seek out the best listing agent that
they could find to represent them in the sale of their present
home, while seeking out and utilizing the services of the best Exclusive
Buyer Agent they can find to help them secure their next home,
thus protecting and hopefully increasing their household net worth
by conserving/maximizing their equity.
The bottom line in all of this is that Wisconsin homebuyers
have many more choices than they've ever had before, and that the
best choice for those seeking true representation, is an Exclusive
The preceding information is an adaptation of an article
that was written by Jay Reifert--Broker/Owner of Excel-Exclusive
Buyer Agency--that was published in the February 16, 1998 edition
of "The Madison Business Journal", Madison's
first business weekly.
You owe it to yourself to do what is in your best
interests--and only an Exclusive Buyer's Agent can offer you the
written, binding promise to do what's in your best interests, 100%
of the time, while offering you access to the entire marketplace,
listed and unlisted properties alike. Why settle for a
traditional agent or even a casual buyer's agent--who
insists on reserving the contractual right to stop
representing you by allowing him or herself to transition into a
dual agent--when you can have 100 percent representation, 100
percent of the time--at no extra cost--by having an
Exclusive Buyer's Agent???
If you're in the Greater Madison Area of Wisconsin--or are
considering moving here--it would be our pleasure to talk with you
further about the benefits of Exclusive Buyer Agency. You can
email us at true-agents@ true-agent.com or, if you'd like, you can
call us toll-free at (800)928-9379, or locally at (608)273-8841.