Buyer Broker Agreements: What Must Be on File Before a Showing

A written buyer agreement is now a precondition, not a preference. Here is what must be on file, when, and what audit exposure follows if it is not. The agreement establishes representation and states compensation before touring, it must be executed before the first showing it covers, and a file whose showing date precedes its agreement date is a compliance failure a reviewer can see in one line.

A buyer broker agreement is a written contract between a buyer and a brokerage that establishes representation and states the compensation before touring homes. It must specify the services, the amount or rate, the duration and whether it is exclusive.

It does two separate jobs, and confusing them is where most file problems start. The first job is agency: it says the brokerage represents this buyer and owes them the duties that come with representation. The second job is compensation: it says what the brokerage is paid, by whom, and when. Some state forms split those into two documents, some combine them into one, and the file has to hold whichever set the state and the brokerage use.

The document also fixes scope. A buyer agreement that covers single family homes in two named counties does not cover a commercial building in a third county, and a brokerage claiming compensation outside the stated scope is arguing against its own form.

The wording column matters more than it looks. A reviewer reading 40 buyer files does not evaluate intent, they check whether each required element is present and specific. Vague service descriptions and range-based compensation are the two failures that recur most.

Before touring. Under post-settlement practice rules, an agent must have a written agreement in place before showing a property, whether the tour is in person or virtual.

The requirement took effect August 17, 2024, when the practice changes required by the NAR settlement were implemented across MLSs. The rule binds MLS participants working with buyers. Several states, including for example New York and Maryland, had written buyer representation requirements in regulation before that date, and those state rules continue to apply on their own terms.

Three edge cases come up constantly and each has a settled answer. An agent hosting their own open house may talk to unrepresented visitors without an agreement, because they are not acting as that visitor's agent. A live video tour conducted for a specific buyer is a showing and requires the agreement first. And a buyer who tours alone and then asks the agent to write an offer still needs a written agreement before representation begins, dated when it was actually signed rather than backdated to the tour.

Backdating is the failure that turns a paperwork gap into a licensing problem. A missing agreement is a rule violation. An agreement dated to hide a missing agreement is a falsified record, and electronic signature audit trails make it visible immediately.

The compensation term must be objectively determinable from the document itself. That rules out three constructions that were common before the practice changes and are now non-compliant.

• Open-ended amounts. "Up to 3 percent" is not an amount, it is a ceiling. A reader cannot compute what is owed.
• Amounts tied to the seller's offer. "Whatever compensation the listing broker offers" makes the buyer's obligation depend on a third party's decision that has not been made yet.
• Blank fields completed later. An agreement signed with the rate blank is not a compensation agreement at the moment of signature, whatever gets written in afterward.

The compliant structure states the brokerage's fee, then states how any seller-paid or listing-broker-paid amount reduces it. That handles the case where the seller offers less than the agreed fee: the buyer covers the difference, and both parties knew that before the first showing rather than at the closing table.

The second requirement is the negotiability statement. Compensation is not set by law, and the agreement has to say so conspicuously. A brokerage that presents a rate as standard invites an antitrust claim it has no defense to.

One more rule follows through into the offer. Whatever the executed contract says about who pays the buyer broker must be consistent with the buyer agreement. A file where the agreement says 2.5 percent buyer-paid and the contract says 3 percent seller-paid has an unexplained gap, and the reviewer will ask about it.

Both satisfy the pre-showing requirement. They differ in what the brokerage is owed and what the buyer gave up.

Non-exclusive agreements, sometimes issued per property or for a short touring window, have become a common on-ramp: sign a narrow agreement to see a house, convert to an exclusive agreement if the relationship continues. The processing risk is version drift, where a buyer accumulates four narrow agreements and nobody can say which one covers the property they eventually bought. Where a brokerage uses this pattern, the file needs a clear record of which agreement was in force on the date of each showing.

The fully executed agreement, dated before the first showing it covers. At audit, the sequence matters: a showing date that precedes the agreement date is a documented compliance failure.

The file-completeness gate is the practical version of this. A buyer-side transaction should not be able to reach commission disbursement review while the buyer agreement is missing, unsigned, expired at the date of the contract, or inconsistent with the compensation in the contract. Brokerages running buyer agreement compliance tracking put that gate in the checklist rather than in somebody's memory, so the missing document blocks the payout instead of surfacing a year later in an audit sample.

Retention periods run by state, commonly three to five years from closing or from the last activity on the file, and some states require longer for agency agreements specifically. The safe default is to retain the buyer agreement for the same period as the transaction file it belongs to, and to retain agreements that never produced a transaction for the same period from expiration.

Agreements end three ways: expiration, completion, or early termination. The first two need no document beyond the agreement itself. The third does.

Early termination should produce a signed release naming the parties, the agreement being released, the effective date of the release, and what happens to any protection period on properties already introduced. Without it, the brokerage's file still shows an active exclusive agreement, and if that buyer purchases through another brokerage inside the term, there is a live compensation question with two agreements pointing different directions.

Protection periods are the part buyers most often misunderstand. A 60 day protection clause means the brokerage is still owed if the buyer purchases a property the brokerage introduced during that window, even after the agreement ends. The clause only works when the file can show which properties were introduced and when, which is another argument for logging showings against the file rather than in an agent's phone.

The buyer agreement opens the file. These documents fill it, and each one has a specific reason for being retained.

The real estate purchase agreement

The contract itself: parties, property, price, financing terms, contingencies, deadlines, inclusions and exclusions, closing date, default remedies and signatures. It governs the transaction, and every other document in the file either supports it, amends it or evidences performance under it. Check that the buyer broker compensation stated here matches the buyer agreement.

The option contract

An option buys time, not a property. The buyer pays an option fee for the right to terminate for any reason inside a stated window, most familiar as the Texas termination option. The file needs the option period dates, the fee amount, proof the fee was delivered inside the delivery deadline, and any termination notice with its delivery record. An option fee delivered late can void the option while the contract survives.

Contract assignment

An assignment transfers the buyer's contract rights to another party before closing, common in investor transactions and in entity formation after contract. The file holds the assignment agreement, the assignee's identity and signing authority, the consideration paid, and the seller's consent where the contract requires it. Assignment without required consent is a breach, not a shortcut, and a few states now restrict wholesale assignments outright.

The lease agreement in the file

Where the brokerage handles leases, the file carries the application, the screening authorization, the executed lease, the move-in condition report and the deposit receipt. Security deposits are usually trust funds under state law with their own accounting and timing rules, so the deposit record is a compliance document rather than a convenience.

The earnest money receipt

It proves the deposit was delivered, in what amount, on what date, and into whose trust account. Most states require deposit within one to three business days of receipt. The receipt is what answers the question at audit, and it is also what a broker relies on when a buyer claims they funded on time. File it the day it exists.

Proof of funds

Acceptable forms are a recent bank or brokerage statement, a letter from the financial institution on letterhead, or a verified balance from the account holder's institution. Account numbers should be redacted before the document enters the file. Screenshots without institution identification, undated statements and letters from a party with an interest in the transaction are not acceptable proof.

The preapproval letter

A preapproval reflects a lender's review of credit and stated income at a point in time. It does not guarantee funding. Underwriting still has to clear income documentation, employment verification, the appraisal, title and the buyer's credit at the time of closing. Note the letter's date, the loan type, the amount and any conditions listed on its face, because a 90 day old letter is close to meaningless.

The inspection report

The report supports whatever request or termination follows it, so the file needs the report, the resolution request or termination notice, the delivery record for that notice, and the executed amendment recording what the parties agreed. A repair agreement without the inspection report behind it leaves the brokerage unable to show why the price changed.

The appraisal and low appraisal outcomes

A low appraisal means the lender will lend against the appraised value rather than the contract price. Four outcomes follow: the seller reduces the price, the buyer brings the difference in cash, the parties split it, or the buyer terminates under the appraisal contingency. Each outcome produces its own document, and the gap amount plus the resolution belongs in the file alongside the appraisal itself.

The signature certificate of completion

Electronic signature platforms generate a certificate listing each signer, the email address used, the signing timestamp, the IP address and the document hash. It evidences who signed, when, and that the document was not altered afterward. It is the record that settles effective date disputes and backdating questions, and it should be archived with every electronically signed document rather than discarded once the PDF is downloaded.

A state regulator or a broker's own compliance review samples files and applies the same short test to each buyer-side transaction. Is there an executed buyer agreement. Is it dated before the first showing. Does it contain the required elements. Does its compensation match the contract. Is there a release where representation ended early.

Five questions, and each one is answered by looking at a date or a field. Brokerages that fail are rarely failing on judgment calls, they are failing because the document is missing, undated, or filed in an agent's email rather than the transaction record. The fix is structural: make the agreement a required item on the buyer-side checklist, require the execution date as a data field rather than a value buried in a PDF, and block disbursement while the item is open.

Done that way, the compliance review stops being an annual event and becomes a condition the file has to satisfy before it moves. That is the whole difference between a brokerage that can produce 40 clean buyer files on request and one that spends two weeks reconstructing them.