Like the listing agreement with sellers, the agreements with buyers must have a starting and ending date as well as specifying how the buyer’s broker is to be paid (by the seller or by the buyer himself). In addition, it should spell out the duties and obligations of all parties.
The agreement should also specify how a conflict of interest will be handled. A conflict of interest can occur when a buyer represented by a conventional firm becomes interested by a seller who is also represented by that firm.
Another potential conflict of interest can occur when the same firm finds itself representing two buyers who are competing for the same property.
A real estate agency should have a written, objective policy for how it will handle conflicts of interest and this policy should be disclosed to any potential client in advance.
