Buyer Agency Agreements Explained: Terms, Pay, Canceling

A buyer agency agreement (also called a buyer representation or buyer-broker agreement) is a contract between a home buyer and a real estate agent. It defines the services the agent will provide, how long the relationship lasts, and how the agent is paid. Since the 2024 commission rules changed, a written agreement is generally required before an agent shows you a home listed through the MLS. Below we cover the agreement types, the terms that matter most, who pays, and how to cancel. General information, not legal advice.

A buyer agency agreement is a written contract that hires a licensed real estate agent to represent you as a home buyer. It commits the agent to a set of services and fiduciary duties, and commits you to work with that agent under the terms you both signed. It goes by several names - buyer representation agreement, buyer-broker agreement - but the substance is the same.

Under the 2024 NAR settlement, a written buyer agreement is now generally required before an agent shows you a home listed through the MLS, and a growing number of states mandate it by law. The idea is transparency: you know up front what your agent will do and what you have agreed to pay, rather than finding out at closing. In practice, expect to sign something before your first tour - even if it is a short, limited agreement for a single showing.

Three types come up most often. The right one depends on how sure you are about the agent, and how much you want to keep your options open.

• Duration. How long the agreement runs. Shorter is safer if you have not worked with the agent before.
• Geographic and property scope. Does it cover any home, or only in a specific area or price range?
• Compensation. The exact fee, how it is calculated (percentage or flat), and who pays first.
• Exclusivity. Are you free to work with other agents, or bound to this one?
• Termination. How either party can end the agreement, and in what conditions.
• Holdover / protection period. Whether the agent is still owed a commission if you close on a home they showed you shortly after the agreement ends.

Under the current rules, the seller may still offer to cover the buyer's agent's compensation, but the buyer's agent fee is set by the agreement between you and your agent - not by whatever the seller is willing to pay. Three common outcomes:

Practically, most sellers still offer some compensation to keep their homes competitive. But because the offer is negotiated and disclosed up front, you and your agent should discuss ahead of any tour how a gap would be handled.

• Loyalty. Putting your interests ahead of the agent's own. For example, showing you the home that fits your criteria, not the one paying a bigger commission.
• Confidentiality. Keeping what you say private. For example, not telling a listing agent your top price.
• Disclosure. Sharing what they know. For example, disclosing that a home you like has been listed and relisted multiple times.
• Reasonable care. Doing the job competently. For example, reading disclosures and pointing out risks.
• Acting in your financial interest. Recommending inspections, calling out overpriced homes, and helping structure a smart offer.

1. Read the termination clause first. It sets the rules - some agreements end on notice, others require a specific reason.
2. Talk to the agent directly. Most good relationships end cleanly if the reason is real.
3. Request a release in writing. Ask for a signed termination or release so there is no ambiguity later.
4. Ask about reassignment. The brokerage may be able to pair you with another agent under the same agreement.
5. Check the holdover period. If the agreement includes a protection period, buying a home you toured with the agent shortly after cancellation could still owe a commission.
6. If in doubt, ask an attorney. A real estate attorney can review the agreement in your state.

• An automatic renewal clause with no easy opt-out. Ask how the agreement ends and whether it renews without your action.
• A compensation amount well above the local norm with no explanation. Ask the agent to justify the rate against the services promised.
• A term far longer than a normal home search. Six months to a year is common; anything longer should have a good reason.
• Vague scope language. "Any property you buy" with no geography or type limits can trap you into owing a fee on an unrelated purchase.
• No mention of what happens if the seller's offered compensation falls short. Get this in writing before you tour homes, not after you write an offer.

A buyer agency agreement represents the buyer; a listing agreement represents the seller. Both set services, term, and compensation, and both are now generally in writing. For the seller side, see our cluster source on listing agreements.

• Signing an exclusive agreement on the spot before touring a single home. It is fine to ask for a limited or single-showing agreement first, then decide on an exclusive relationship once you trust the agent.
• Not asking what happens if the seller offers less than the agent's fee. Get this answered before you write an offer, not during negotiations.
• Ignoring the geographic or property scope. An agreement written broadly can bind you even for a home you find on your own in a different part of town.
• Skipping the holdover clause. If you tour a home with one agent, cancel, and buy that same home through a different agent soon after, the first agent may still be owed a commission.
• Assuming verbal promises count. Only the signed agreement controls. If an agent tells you something that is not in the document, ask for it in writing before you sign.

Requirements for written buyer agreements vary by state, and some states have their own rules about disclosure, term limits, and how compensation must be presented. Treat any figure or rule in this guide as a general starting point and confirm your state's specific requirements with your agent or a local real estate attorney.

The buyer agreement is one of several documents a deal runs on. The signatures, disclosures, and key dates behind it are what a brokerage's real estate transaction management platform keeps organized. See our full guide to real estate transaction management. Related reading in this cluster: can a seller back out.

1. Ask for the agreement before the day of the showing. Reading it at your kitchen table beats skimming it in the driveway.
2. Confirm the exact compensation figure and how it is calculated. Percentage of sale price and flat fee behave very differently on a $250,000 home versus a $750,000 home.
3. Ask what happens if the seller's offer falls short. Get the answer in writing, before you write an offer on a home.
4. Check the term length against your actual timeline. If you expect a quick search, do not sign a year-long exclusive without a reason.
5. Ask about the holdover clause specifically. Understand what "shortly after" means in the agreement's own words, not just in conversation.
6. Confirm you can request a different agent within the brokerage if the relationship is not working. Many buyers do not realize this is usually possible.

First-time buyers are usually not resistant to signing - they are confused about why they are being asked to, and worried about being locked in before they trust you. Walk them through the agreement line by line rather than handing it over to sign quickly: name the services you are committing to, explain the compensation and what happens if the seller's offer is lower, and offer a short or limited agreement if they are not ready to commit. A buyer who understands what they signed is far less likely to want out of it three weeks later, and a clean, well-explained signing is also the first impression of how organized the rest of the transaction will be.