Buyer Representation Agreement

What is it?

Here is a breakdown of the BRA and how it affects your buyer decisions.

Buyer Representation Agreement is an important contract when looking to purchase a home. Most people are aware of a Listing Agreement contract when selling a home, but are not clear on the contract when buying a home called Buyer Representation Agreement or BRA.

BRA is a contract between a Buyer and a real estate company that gives the real estate company permission to act on the Buyer’s
behalf in the purchase of a property. Assuming the Buyer is a Client of the real estate company, the Real Estate Council of Ontario (Ontario’s governing body) REBBA Code of Ethics requires that Salespeople have a written Buyer Representation Agreement presented for signature prior to an offer being presented on behalf of the Buyer.

The first section identifies the parties involved in the Agreement and sets the time frame for which the contract is valid.

Commission Section is something to be wary of because different situations can arise when purchasing a property especially if it’s a For Sale By Owner (FSBOs) or private property sale. It outlines what the commission paid to the brokerage will be regardless of what the seller or property is offering. If the commission the seller is offering is lower than the commission stipulated in the BRA then you as a buyer would be responsible for the difference. Also, some private sellers or FSBOs don’t offer commission to a buyer agent which would mean the buyer would be on the hook for the stipulated commission on the BRA.

Holdover Period is important to understand. A holdover is a certain amount of time after the expiration of the contract. If a buyer was introduced to a property during the BRA contract term then goes back and buys that property after the expiration of the BRA, but within the holdover time frame, the buyer would be responsible to pay the buyer agents’ commission.

Clauses in agreements or contracts can be wordy, long and confusing. This link will help explain the BRA and its clauses in plain language.

Be sure to review the entire contract including any extra clauses in attached Schedule(s).

Buyer Representation Agreement in Plain Language

Buyer Representation Agreement Benefits Video