The Benefits of the Exclusive Brokerage Contract - Purchase- Key Information
When purchasing a divided or undivided co-ownership, or a building with fewer than 5 units, with a real estate broker, signing an Exclusive brokerage contract – Purchase is an important step. This form, required according to the regulations of the Organisme d’autoréglementation du courtage immobilier du Québec (OACIQ), is an agreement signed between a client (buyer) and a real estate broker, in which the client commits to work exclusively with that broker for the search and purchase of a property. The signing of the contract presents numerous advantages for the buyer. Here, our real estate brokers outline the main benefits.
You are represented by your real estate broker
When a buyer signs an Exclusive brokerage contract – Purchase, they establish a fiduciary representation relationship with the real estate broker. This means that the broker is legally and ethically obligated to represent the buyer’s interests loyally and diligently, thereby avoiding dual agency. Without a contract, the broker cannot represent you and must work with the seller’s broker.
Your interests are defended
Signing an Exclusive brokerage contract enables the defense of your interests. By exclusively working with a broker, you minimize the risk of conflicts of interest. The broker has no competing obligation to the seller and can fully focus on defending your interests without being divided by other commitments.
When your interests are represented by a real estate broker, confidentiality is a priority. Sensitive details such as your maximum budget, specific preferences, and other confidential information are handled with special care. This ensures that your negotiations and strategies are not exposed to unauthorized parties.
Your real estate broker also commits to defending your interests during negotiations with the sellers’ real estate brokers. They leverage their experience and expertise to secure the best possible terms for you, whether it be in terms of purchase price, closing conditions, or other negotiable aspects.
You are advised by your real estate broker
Expect continuous assistance from your exclusive broker throughout the buying process, from initial search to transaction closure. This typically includes advice on inspections, financing, and other aspects related to real estate purchases. Your broker can also provide market-specific information, anticipate potential challenges, and help you make informed decisions based on your goals and preferences.
You get a fair purchase price
With the signing of an Exclusive brokerage contract – Purchase, the broker can perform one of the crucial tasks for a buyer, which is conducting comparative market analyses. The broker carefully selects comparable properties based on specific criteria such as property type (house, income property, divided or undivided co-ownership, etc.), location, size, number of bedrooms and bathrooms, age of construction, and other important features. The goal is to find properties similar to what the buyer is looking for to determine a fair purchase price for the desired property. Having a fair purchase price can help you stand out in multiple-offer situations. Without signing the Exclusive brokerage contract – Purchase, there is no possibility of accessing comparables. The purchase price will not be competitive and will simply reflect the amount the buyer is willing to pay to acquire the property.
You benefit from advice for writing the promise to purchase
With the signing of an Exclusive brokerage contract – Purchase, the broker’s expertise is not limited to property search but also extends to protecting and benefiting the buyer through advice on conditions and clauses to include in the promise to purchase.
By identifying potential risks related to the property or transaction, the broker can advise you on clauses to include to mitigate these risks. This could include clauses specific to structural issues, hidden defects, or other property-specific concerns.
The broker can advise you on how to structure financing conditions in the purchase offer. This could include specific financing provisions, timelines for mortgage approval, and other elements related to the financial aspect of the transaction.
The broker can also collaborate with real estate specialized lawyers to ensure that all proposed clauses are legally valid and offer the desired protection.
Without a purchase brokerage contract, the real estate broker can only enter your criteria in different sections of the purchase offer, without advising you on the possibility of modifying certain criteria to your advantage or adapting them more to your objectives.
In conclusion, signing an Exclusive brokerage contract – Purchase is a crucial step offering several advantages to the buyer. This contract, mandatory according to the regulations of the OACIQ, establishes a strong fiduciary relationship between the buyer and the real estate broker, ensuring exclusive representation and diligent defense of the buyer’s interests. Furthermore, it enhances the confidentiality of sensitive information and enables the broker to provide specialized advice, particularly regarding market analysis and purchase offer drafting. These combined benefits make signing this contract a strategic and wise step in the real estate acquisition process.
Questions about the Exclusive brokerage contract – Purchase ? Read How does an Exclusive Brokerage Contract – Purchase (BCP) work?