Buyer Representation Agreements – Misconceptions and Corrections
There are lots of misconceptions out there about the new buyer representation forms and especially a new provision that was added to the Residential Purchase Agreement (“RPA”) in December 2022. This article attempts to correct some of those common misconceptions.
Misconception #1. Buyer representation agreements are required by law starting with the December 2022 release of new C.A.R. forms.
False. Buyer representation agreements have many benefits. They can promote good communication and transparency between the licensee and buyer regarding the buyer’s property needs, the services to be performed by the licensee, and compensation to the licensee. In addition, buyer representation agreements may assist the licensee if there is a procuring cause dispute, and there can be risk management benefits for the licensee. However, there is not a legal requirement to use a buyer representation agreement.