Exclusive Agency Agreement

[Andy V.]

I need to get opinions on something.  I have been talking with a realtor and I'm supposed to be meeting him tonight to look at a property in the Chicago metro area.  He sent me a text a little while ago asking if I had a problem signing an exclusive agency agreement and that he'd be bringing one with to the house he's showing me tonight.  

First, what exactly is an exclusive agency agreement? Does this prevent me from buying property except through him or the broker he works under?  I've also been speaking with a couple of wholesalers who were waiting on calls back from home owners in my target area.

Second, should I sign it?  I searched quickly on BP and saw posts about non-exclusive agreements, but I also saw one comment to amend the contract to list this specific property or only properties that he brings to my attention. 

Any thoughts would be greatly appreciated.

[Rob Beland]

@Andy V.basically what it means is that if you are looking to buy an MLS listed property you will work through the agent and not contact the listing agent directly. You can always decline to sign it. Read the agreement.It should only apply to listed properties. The agent wants to be sure he gets a commission (paid by the seller). If its a private sale it shouldn't apply.

[Bryan N.]

Not sure about your area.  In mine it "binds" you to that realtor for 90 days.  You can get out of it, but I won't deal with a realtor who uses that.  There are plenty that don't.  

[Sonya Stovall]

Yes be sure to read the agreement, it could also include non-MLS properties IF (emphasis on IF) the agent makes you aware of those properties and he/she is the reason you are interested in buying that said property. In those cases, you may have to pay the fee out of your pocket. I hope it works out for you.

[Franklin Romine]

@andy v.  

I wouldn't sign it and that is coming from a realtor.  I wouldn't ask a client to sign one.  For some reason I see insecurity in that document. This is my personal opinion.

Frank

[Guy Gimenez]

@Andy V.

Don't bind yourself to one company or agent....what if you decide you are not a good fit to work together.  At that point it's just too bad, you're bound to the agreement.  Explain to the agent that you will only agree to work with the agent on properties they physically show you...otherwise, you're free to purchase any property on your own or through another broker.  

[Phillip Faries]

@Andy V.

I agree with everyone, you'll be stuck with that one realtor. 

The first deal i did, my realtor had me sign one. Little did i know she was terrible to deal with and i was stuck with her for 90 days, i had to figure everything out on my own as she never responded....... per the agreement, if i closed on a property not with her, she was entitled to commission regardless of if she was apart of the deal or not.

Hope this helps.

[James Wise]

We don't use those. You want your client to exclusively work with you because they want to, not because they are handcuffed.