The Sitzer-Burnett verdict underscores the need for increased transparency when it comes to compensation. Agents need to understand how important written buyer agreements are and how best to present their value to clients.
The Sitzer-Burnett verdict from October 2023 has reignited discussions about compensation and transparency within real estate professionals, with written buyer agreements becoming a topic of conversation within this field due to litigation brought on behalf of home sellers regarding broker compensation; all MLS participants providing services for buyers will soon need to enter into written buyer agreements before touring properties on MLS.
Legally binding contracts offer both parties the necessary protection and transparency.
“This program sets forth and quantifies the responsibilities of brokers for buyers as well as those owed to buyers when working with brokers,” according to Lynn Madison, an Illinois REALTOR(r) and owner of Madison Seminars.
Instead of relying on verbal communication or assumed understanding during a transaction, a written agreement lays out expectations clearly: services provided to buyers; agency relationships between brokerage and buyers; compensation systems offered by brokers and how this system supports buyer needs.
Over the past several months, more brokerages have emphasized the significance of written buyer agreements to ensure greater clarity and transparency between brokers and consumers. Madison suggests that broker training on written agreements as soon as practice changes occur – including how best to present them – would benefit consumers immensely.
