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Looking for some advice – my partner and I signed the BRA with our realtor, but have recently seen a place outside of him that we really like.
Our options seem like: be upfront and see if he will apply for us, ask to leave the BRA, or lie and say our situation has changed and we don’t need him anymore.
Side note – there are many reasons we’ve come across that make us want to break the contract anyways…lazy, wanting to lie on our application, not showing us places we want to see well before 24h notice, etc.
It is coming down to the last few weeks until we need to be out of our current place, so time is feeling short.
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Nick's Response
Which province are you located in? That will play a role in what your options are here.
In Ontario, the Buyer Representation Agreement (form 300 or 371 depending upon brokerage or designated representation) has a paragraph about “Referral of Properties.” Specifically, this outlines your responsibility to let your Realtor know about any and all properties that you may be interested in, including any that you found on your own.
Taking this further, this could mean that even if you were released from your Buyer Representation Agreement and bought the target property within the holdover period (another paragraph in the BRA) then the Realtor or their brokerage could pursue you for commission owed, and it would probably be a pretty slam-dunk case against you.
Would a Realtor find out if you had done this? Maybe not. Would they pursue you if they did find out? Maybe. If I were the Realtor I might be pretty (rightfully) annoyed that you hadn’t been upfront with me and that might increase the chances of pursuing you for commission.
If I were in your position, I would consider taking on the (admittedly awkward) conversation with the Realtor and ask to be released from the BRA and honest as to why as you’ve outlined:
You’ve found a property on your own that you would like to pursue as an unrepresented Buyer.
You have not been satisfied with the Realtor’s level of service to date (be specific with examples)
You don’t feel that he will be beneficial in your negotiations with the Seller.
Your Realtor will either release you or put up a fuss about it, at which point you can escalate it to his broker if you’re so inclined. It’s the more challenging route to take than lying and going around him, but in the end it keeps you out of potential legal complications and is fair to everyone involved. Not to preach too much hopefully, but you did sign a legal contract with your Realtor and that deserves to be treated as binding until you’re released.
Source: I’m biased as I’m a Realtor (Ottawa) but I also want to keep you out of a potentially messy situation.
In Ontario RECO has published a useful new guide that outlines your rights and responsibilities pretty well.
Good luck on the purchase, whichever route you take!
3 Things set out in a Buyer Representation Agreement that can be negotiated
1
Scope – When you sign form 371 or 372 in Ontario, your Realtor is agreeing to represent you for a certain type of property in a certain geographic area. This can be broad or very specific. You get to choose the scope so be clear with your Realtor before signing.
2
Commission – Your Realtor should have a reasonable expectation of being paid for their services to you, so commission is one of the things set out in the BRA. There is no standard commission amount in Ontario, and Realtors can be paid as a percentage of the sale price of a home (most common) or a flat fee. Our team does not set a commission at all, but instead agrees to receive whatever the listing brokerage is offering. Be absolutely sure to understand this before signing.
3
Time – You and your Realtor are agreeing to work together for a certain amount of time. This should be long enough to reasonably find and close on a home, but not so long that you feel trapped. You can always extend the time if it’s taking a while to find a home. My team writes our agreements for six months less a day, as we feel that covers 99% of situations for our clients.
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