Allow me to address some confusion which can arise pertaining to a listing (seller’s) agent representing a buyer, as opposed to a buyer having his or her own agent.
Some buyers don’t understand who they should contact when they go see a property. The name of the REALTOR® on the yard sign or the online listing, is actually the seller’s agent. Think about it…a seller’s agent loves it when a buyer calls them directly because they might then get to represent both sides. Keep in mind that Dual Agency is legal in West Virginia but also keep in mind that a listing agent is supposed to have the fiduciary obligation of looking out for the seller. Having said that, both parties can agree and sign off on a Dual Agency scenario. The agent however can’t easily have the best interests of both parties at heart. It limits how the agent can advise each party on how to respond to a counteroffer or requests of paying for repairs. Another dilemma which can arise is when an appraisal comes in below the agreed price and then needs to be re-negotiated.
Having said all of that, there are situations where Dual Agency can work but BOTH parties need to be able to trust that the agent won’t compromise them in negotiations. In other words, the agent can’t divulge to the seller, how much the buyer can afford or can’t divulge to the buyer, the bottom line for the seller. A situation which makes it easier to represent both sides, is when neither price nor repairs are to be negotiated. In other words, a property being sold “As Is”.
So, what should a buyer do? Well, if they end up talking to the seller’s agent, they can say they want their own agent to advise them. A good listing agent should also ask that buyer, “Are you already working with a REALTOR®?” Getting this all out in front, will eliminate numerous possible complications or misunderstandings during a transaction.
For some clarity, the following is generally how REALTOR® compensation works. There’s a commission determined by the listing brokerage, often around 6%. When there are agents on both sides of the transaction, the broker of the listing agent will then compensate the broker of the buyer’s agent. Essentially, they agree to a split. Each agent and their brokers also have their own internal splits, so it’s not as though one person is getting all of the commission. That’s actually far from reality. There’s a misconception out there when it comes to this. Just because the seller is paying 6%, do not think that all of that goes to one REALTOR®. It does NOT! There are multiple parties in these transactions and a lot of work is involved by all parties.
Back to my original point…any licensed REALTOR® in your market, can show any property which is listed. A buyer is NOT restricted to the REALTOR® who has their name on the sign.
Brian McCommon, 2024 MBOR President