No one says it will be easy. You'll be a maverick, cutting away from the herd. To become an Exclusive Buyer's Agent means walking away from listings and always working outside the traditional agency culture. It means suffering the derision of some traditional agents, who scorn the attempt. But if you are willing to be a pioneer, there could be gold on the other side of the mountain waiting for you.

The first thing you will have to overcome is the fact that The National Association of REALTORS® does not yet recognize the exclusive buyer's agent, so there won't be any support for your effort from your own trade organization. What NAR does make make provisions for are those Realtors with a special interest in buyer agency. The Real Estate Buyer Advocacy Council (REBAC) a subsidiary of the National Association of REALTORS® offers the only NAR-sponsored designation for the buyer agent - the Accredited Buyers Representative(ABR) designation. Although the designation indicates an expertise in buyer agency issues, the bearer can still represent sellers and participate in dual agency contracts.

But dual agency and the temptation to represent sellers create an atmosphere ripe for conflict of interest, insists Merrrill Ottwein, president of the National Association of Exclusive Buyer Agents, a non-profit trade organization devoted to exclusive buyer agency. Ottwein, along with 400 other members, over 50% of whom are also REBAC members, believes there is a better way.

NAEBA represents the idealistic end of the buyer agency spectrum. Members believe that representing sellers in any form is a fiduciary breach when representing buyers. Dual agency and taking listings of any kind are a no-no. According to Association Manager Kathleen Chiras, "Conflict of interest can exist in any agency environment. How about just creating an environment where you don't have to worry about whether or not you are doing the ethical thing? By operating an office that is exclusively for buyers, you are never put in a compromising situation."

Refusing to take listings is the biggest hurdle for the exclusive buyer's agent. Ottwein admits that educating the public and other Realtors about the benefits of exclusive buyer agency will be an uphill battle, and one that will have to be fueled by idealism. "It hurts not to take listings and not to be able to list your own home, but the rewards come as you develop your skills in exclusive buyer agency. You become better at it because it is a specialty. You gather information to the buyer's benefit, learn negotiating strategies and due diligence in association with identifying risks in the home and in the contract. You are being paid to look for trouble, and that benefits the buyer at resale time, because you have helped influence the value of their home."

"It will take Independent thinkers to embrace the purity of true fiduciaries," says Ottwein. "Our motto is above all, the customer. Our intention is to give "client level service" according to the Common Law of Agency, and a higher level of service than the laws of most states require."

The second hurdle is selling the idea to other agents. Our system of disbursing the buyer's loan proceeds to the seller through an independent - the title company, has encouraged the sales transaction to favor the seller because it is the seller who pays the buyer's agent out of the proceeds. Although the buyer's agent is the buyer's advocate, the agent is not a fiduciary in the same way the seller's agent is to the seller. In fact, the buyer's agent is positioned as a sub-agent to the seller. Another point made by traditional agents is that because the buyer's agent is paid out of the transaction price, the higher the price the more the buyer's agent is paid, leaving the door open for conflict of interest.

Chiras counters, "The commission to both the buyer and the seller's agents are paid out of the transaction price. Who is really paying the commission is debatable -the seller is coming to the table with equity, and the buyer arrives with the money, so both parties are clearly being paid out of the transaction price. This makes perfect sense to consumers."

"I have praticed nine years, and I continually find new ways to serve buyers better. The biggest benefit you give your clients is when they sell the home we helped them buy. We set them up for the resale - a profound benefit that they don't realize until years later. I have come to believe that the biggest financial benefit to selling a home begins at the time of purchase, because that influences the value later on."

When a client is ready to sell, NAEBA members refer him/her to a seller's agent. "We cultivate relationships with selling agents," says Chiras.

The third hurdle the exclusive buyer's agent has to overcome is adhering to the strict standards of exclusive buyer's agency as outlined by NAEBA. NAEBA provides its own certification - the Certified Exclusive Buyer Agent (CEBA.) the only certification for exclusive buyer agency.

Members must be licensed Realtors, and must be willing to work only with buyers, and offer no seller services.

The idea is experiencing some success, and several agents believe that sellers-only agency is the next inevitable trend, suggests Chiras. "One of our Houston offices has grown to over forty agents," she says. "Our organization is being listed in books, and picked up by authors."

The fourth hurdle is educating the public, says Chiras. "Right now, there are several kinds of representation that can be obtained by a buyer, and we believe that any situation other than exclusive buyer agency represents the potential for conflict of interest."

NAEBA members must adhere to a strict Standards of Practice which are designed to protect the buyer/consumer.

Currently, there are four types of agents available to assist home buyers and sellers in the real estate transaction:

EBA - EXCLUSIVE BUYER AGENT, works for an office that does not take listings of any kind and represents only buyers.

SA - SINGLE AGENCY BUYER AGENT, works for an office that takes listings, represents buyers and sellers, but will represent only one client in any real estate transaction. Will not practice dual agency!

BA - BUYER AGENT, works in a traditional real estate office that takes listings. Will work with a buyer under contract. If a buyer wishes to purchase a property that is listed by their office, they will declare dual agency and represent both the seller and the buyer.

TA - TRADITIONAL AGENT, works in a real estate office that takes listings. Usually represents the seller and will be a dual agent anytime they represent the buyer.

Dual agency, cautions Chiras, has the potential for the biggest conflict of interest. When an office stands to profit from both sides of the transaction by taking listings and representing buyers, there can exist a subtle pressure from the owner/broker toward agents to promote in-house listings first, or for the agents to put their heads together and reveal information that would otherwise be private to the seller or buyer. "A lot of business is done at the water cooler that is more in the interest of the agents than the buyer or seller," she says.

With an exclusive buyer's agent, the buyer will see the full spectrum of homes for sale that meet the buyer's criteria, from MLS listings to Internet listings, and FSBOs to foreclosures.

"We have come a long way since every agent was a sub-agent of the seller," concludes Chiras.

Published: September 22, 1998

Use of this article without permission is a violation of federal copyright laws.

Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.