Buyer Broker Agreements the Shady Way


In my nearly 11 years in the real estate business I’ve seen a lot of things. But what I encountered Friday night has to be one of the most brazen concepts yet on several different levels.

Here are the basics. There is a brokerage locally who has developed their own buyer broker agreement which, as we’ve discussed here previously, ties a buyer to the brokerage for a set period of time. Whether a buyer chooses to sign such a thing is their choice; some agents require them, I for one never have because I still believe in a person’s integrity.

Nevertheless, there is this new form which includes a modified version of the Arizona Association of REALTORS’ Buyer Broker Agreement (and, in fact, likely violates the copyright on the AAR form a dozen different ways, but I digress.)

On page one, the buyer checks the box to say they have watched a video outlining a 47-step process the broker uses for searching for homes.

Allow that to sink in for a minute.

A 47-step process.

Sounds impressive but seriously? Insert Colin Hay here.

But that’s not the best part.

On this first page, the buyer also agrees to pay the broker nearly $4,000 for the honor of working with that broker. For that nearly $4,000, the buyer will have the broker’s full time and attention … along with the broker’s other clients, but I digress again.

Now, the version I saw had a curious strikethrough. Rather than charging the buyer that nearly $4,000, the broker generously decided he will work with the agent and only request 3 to 5 referrals instead. (No indication of what happens if the referrals aren’t provided.)

If you’re with me here, are you thinking what I’m thinking? How many times do you believe the broker charged the fee versus how many times did the broker “waive” the fee and ask for referrals instead? If the answer to the former is zero, we’re on the same page.

Deceptive? Just a little. With luck, someone forwards the form to the Arizona Department of Real Estate.

There are other options, of course. If a buyer only wants two hours of the agent’s time, that only costs around $800. Because, yeah, your average real estate should have higher billable hours than an attorney.

As for the pilfered and modified buyer broker agreement itself, there’s another interesting twist.

It’s not uncommon at all for buyers to request seller assistance with their closing costs. By this form, however, the brokerage is to be paid their commission before the buyers’ closing costs come out of the seller contribution. So it’s quite possible for the brokerage to negotiate closing cost assistance for a buyer who will never see the assistance.

Violation of the National Association of REALTORS’ code of ethics for putting commission first? Awfully close, even if the buyer signs off on the form. After all, how hard is it for a buyer to argue they had no idea of the nitty gritty of what they were signing.

All in all, there’s nothing good that can come to a consumer from this form. The fact it exists makes me bury my head in my hands as a real estate professional because it makes all of us look as commission- and money-grubbing as some in the public already think we are as a group.

With luck, this form gets forwarded to AAR and NAR and the broker is handed a cease and desist. Will that happen? Who knows.

Will people sign in the interim, believing the extravagantly laid b.s. in the form? Of course. There’s another sucker born every minute, as they say.

Photo credit: Daniel Lobo via Flickr Creative Commons

Jonathan Dalton

Jonathan Dalton is a 40-plus-year resident of the Valley and has been helping folks buy and sell homes since 2004. He can be reached at 602-502-9693 or info at

1 Comment

  • Kim Decker 3 years ago

    I myself saw the same one you did, I can't believe they can get anyone to sign that thing. I think it's predatory !

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