Buyer Representation
Real Estate Buyer's Agent Explained
A buyer's agent represents the buyer — not the seller — with full fiduciary duties. Here's what the exam tests about buyer representation agreements, duties, and 2024 compensation changes.
What Is a Buyer's Agent?
A buyer's agent (buyer's representative) is a real estate licensee who represents the buyer's interests in a transaction. The buyer's agent owes fiduciary duties exclusively to the buyer: loyalty, confidentiality, disclosure, accounting, and reasonable care.
After the 2024 NAR settlement (effective August 2024), MLS participants cannot include buyer's agent compensation offers in MLS listings. Buyers must now negotiate and agree to buyer's agent compensation in a written Buyer Representation Agreement before touring homes.
Buyer's Agent Duties (Fiduciary: OLDCAR)
Obedience
Follow the buyer's lawful instructions — even if the agent disagrees with the buyer's price point or property choices.
Loyalty
Put the buyer's interest above all others, including the agent's own interest in earning a commission.
Disclosure
Reveal all material facts relevant to the transaction — including any known defects, seller's motivation if discovered, or multiple-offer situations.
Confidentiality
Protect the buyer's personal information — financial capacity, maximum price willing to pay, urgency — from the seller or listing agent.
Accounting
Handle all funds properly. Earnest money must be deposited in the broker's trust account promptly.
Reasonable Care
Exercise professional skill and diligence in all services provided to the buyer.
Buyer's Agent FAQ for the Exam
What must a Buyer Representation Agreement include?
A valid agreement must identify the parties, specify the agent's compensation (amount or method of calculation), define the scope of services, include a start and expiration date, and be signed by both the buyer and the broker/agent.
Can a buyer's agent tell the seller what price the buyer is willing to pay?
No. Revealing the buyer's maximum price to the seller or listing agent is a breach of confidentiality — one of the most serious violations a buyer's agent can commit.
What is procuring cause?
Procuring cause is the standard used to determine which agent is entitled to a commission when a dispute arises. The procuring cause is the agent whose actions were the direct, proximate cause of the completed sale.