# Buying personally while in real estate agreement



## real2me (May 7, 2016)

I had signed up with a real estate agent for 28 days, but since then the property that I am living in, the owner has shown interest in selling it.

Now the agent hasn't shown me this property. But I understand that if I purchase the property even not shown by the agent, I need to pay the buyer's comission.

According to the agreement signed
_The Buyer agrees to pay the Brokerage such commission if the Buyer enters into an agreement within ................................. (182) days after the expiration
of this Agreement (Holdover Period) to purchase or lease any real property shown or introduced to the Buyer from any source whatsoever during
the term of this Agreement, provided, however, that if the Buyer enters into a new buyer representation agreement with another registered real estate
brokerage after the expiration of this Agreement, the Buyer’s liability to pay commission to the Brokerage shall be reduced by the amount paid to the
other brokerage under the new agreement._

Does this mean that if I buy any property personally within the 182 day period I will need to pay the buyer's commission 
OR
Does this mean that if I was shown a property after the 28 days when agreement will be terminated (_introduced to the Buyer from any source whatsoever during
the term of this Agreement_) I don't need to pay the buyer's comission?

I will seek a lawyer's help on this but just wanted to gather some general consensus and whether someone has gone through this in the past and what the best course of action was?


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## mordko (Jan 23, 2016)

Given that you were aware of the property prior to signing the agreement, most agents wouldn't even try to make you pay under this scenario. His case against you would be very weak to impossible. I would raise this with the realtor and see what he says.


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## mordko (Jan 23, 2016)

What you should have done was to explicitly exclude this property from the agreement by stating so. Still, it's highly unlikely you would be forced to pay.


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## birdman (Feb 12, 2013)

I read it that the 182 days only applies to "any properties introduced to the buyer"; otherwise its 28 days.


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## real2me (May 7, 2016)

mordko said:


> What you should have done was to explicitly exclude this property from the agreement by stating so. Still, it's highly unlikely you would be forced to pay.


I didn't know that the landlord intended to sell it, otherwise I would have not even go through the realtor.



> I read it that the 182 days only applies to "any properties introduced to the buyer"; otherwise its 28 days.


Yeah, that's how I am reading it too. Safe option is to wait for the 28 day period to get over and then buy the property. But I don't want my landlord to start having second thoughts and want to act now. But I am weary of the 28 days clause, even though it's the place I am living in.


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## Mechanic (Oct 29, 2013)

Give the landlord a deposit until the waiting period is over, then buy the property. I have commented several times on this. NEVER sign these exclusive buyer agreements. These are the same realtors that won't show you properties where sellers have negotiated lower commissions too. If the realtor doesnt want to work with you, find another realtor. There are lots of good realtors that don't make you sign these deals.


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## real2me (May 7, 2016)

Mechanic said:


> Give the landlord a deposit until the waiting period is over, then buy the property. I have commented several times on this. NEVER sign these exclusive buyer agreements. These are the same realtors that won't show you properties where sellers have negotiated lower commissions too. If the realtor doesnt want to work with you, find another realtor. There are lots of good realtors that don't make you sign these deals.


I was thinking of that. So usually the deposit that you give too the seller as an intention of purchase won't be counted towards my purchase and void the agreement? As I will be using the same deposit as part of the payment?


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## Berubeland (Sep 6, 2009)

real2me said:


> I was thinking of that. So usually the deposit that you give too the seller as an intention of purchase won't be counted towards my purchase and void the agreement? As I will be using the same deposit as part of the payment?


I recently had a tenant have problems with an agent making him sign a BRA for a rental. 

Then he wanted to charge him, and it was a 90 day agreement. 

This after he was turned down by a landlord because he has a little dog. Credit is AAA+ 

Complete craziness.


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## Ottawa Realtor (Aug 16, 2015)

real2me said:


> I had signed up with a real estate agent for 28 days, but since then the property that I am living in, the owner has shown interest in selling it.
> 
> Now the agent hasn't shown me this property. But I understand that if I purchase the property even not shown by the agent, I need to pay the buyer's comission.
> 
> ...


Presumably you're doing this to get it cheaper as the landlord/owner will pass on the savings from not having to pay the brokerage fees. This leads to a lot of questions such as who's benefiting from this, you or the owner or both? You're also making the assumption that both of you can come to a fair market price but how do you know what the fair market price is? The supposed savings you are anticipating to make may be more than offset by overpaying for the home. Same goes for the owner. That is why the agent would be able to represent your interests by making sure you do not overpay. You can also talk to your agent and ask him/her to represent you in a private deal and pay them 2%. It's insurance. You might pay $5-$6K but save $20K.
Here's an example I had with an investor that wanted some acreage that could be subdivided. After looking at listed properties for a while I found a parcel privately, of about 80 acres, so I approached the owner on behalf of my clients and eventually I negotiated and he agreed to sell for $200K. I was not representing him and my buyer, who I represented, paid my brokerage fee. That property, I knew, was worth, at least $250K and maybe close to $300K. My buyer was even willing to pay the higher amount but I could not disclose that. If the land owner had representation I guarantee that my buyer would have paid more. Lack of knowledge is a lot more dangerous than lack of representation.


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## yyz (Aug 11, 2013)

And surely you could get an appraisal done for a reasonable fee,probably less than commission?


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## chantl01 (Mar 17, 2011)

yyz said:


> And surely you could get an appraisal done for a reasonable fee,probably less than commission?


Absolutely. My husband and I just sold our house privately. We paid a professional $500 to appraise our house. Saved $25K in realtor commissions and both we and our buyers got a better deal by not paying any middlemen.


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## Rusty O'Toole (Feb 1, 2012)

He can't claim he introduced you to a property in the last 28 days that you are already living in. You don't owe him a thing. But in common courtesy you should let him know you are buying the property if you do come to an agreement with your landlord. It would be best to do this before you sign anything and let your landlord know you have an agent, and not to talk to that agent or deal with them.

If the agent turns nasty you may need to have your lawyer threaten him but I don't see where he has a leg to stand on.

I would never sign such an agreement and would not deal with an agent who wanted me to.


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## Ottawa Realtor (Aug 16, 2015)

There are many benefits to signing an exclusive listing that people may not be aware. Not signing one doesn't require the agent to do much for you except the basics and you have no recourse if you find out you have a problem with the deal or something wasn't revealed properly or you weren't given all the available information to make a decision. I don't ask buyers to sign an exclusive agreement but if I find something for them I get them to sign one just for the specific property that an offer has been made on. This way the buyer can go his own way if the deal falls through and it also protects them better than a Buyer Service agreement or none at all as they have recourse if not treated right. I have no problem with that. Most agents are not going to chase you down for commission anyways, they have better things to do than piss somebody off. You might get some flack if the property was a million or so but for a few thousand they are unlikely to bother and will probably not find out.
Another thing is the notion that an appraisal is all you need to do to determine whether it's a fair deal. Certainly for that one specific property you will be right but what about other properties? If you show me a property and an appraisal I bet I can find you a better one at a cheaper price. Leaving you to decide on only one property is decidedly disadvantageous to viewing all properties on the market. It's a good deal for the seller that found a buyer privately but unless that buyer has already seen all the other properties for sale on the MLS system it's not good for them. That is why agents try to sign people up so they stay loyal. Personally, again, I don't care if a prospect of mine finds a private deal. I tell them go for it!


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## nobleea (Oct 11, 2013)

The fact that Ottawa Realtor hasn't said anything about the OP's issues suggests that there is absolutely no legal obligation on OP's part.

A few more years and we'll see some real changes in how the system operates. Now that the competition tribunal has indicated the previous selling prices must be made publicly available, we'll see a Canadian version of something like Zillow pretty soon.

We just sold our house privately this month. We netted the same amount and the buyers paid less. There is a local realtor who publishes the actual sale prices every month. He doesn't say which property sold for how much, but there's so few sales, it's not hard to figure out which one is which. With that sales price info soon to be publicly available, figuring out a sales price (as both buyer and seller) won't be hard. Pay an appraiser if you want a professional's opinion.


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## gentlepuppies (Jan 17, 2016)

Well the agreement refers to any property introduced to buyer from "any source"...

I signed a similar agreement with an agent, who turned out to be somewhat beginner level; except when he sensed that I was looking at back-up properties and reaching out to other agents (in case the pending deal didn't go through), he told me he wouldn't hold me to the agreement against my will.


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