The thoughts here are not legal advice, but general considerations home buyers should consider when entering an agreement. Consumers always have the right to consult legal counsel before entering a legal agreement.

With recent changes to the real estate industry, via trade association rules or in NJ’s case, the passing of the Consumer Protection Enhancement Act, it’s now required that home buyers and their agents/brokers enter into a written agreement before the agent begins to work on the buyer’s behalf.

Overall, this is a positive change to the industry that makes it clear what the responsibilities of the agent, and home buyer are, as well as transparent documentation of the associated cost. But home buyers should be aware of terms and conditions in Buyer-Broker agreements that may not be favorable to them.

Consumers should specifically be aware of Buyer Broker agreements with the following conditions:

Limitation on Dispute Resolution: Should a conflict between consumer and brokerage arise, there should be no limits on buyer remedies. Buyers should not be required to submit first to mediation or arbitration to pursue a grievance

Threat of Lien: While disputes may arise in some cases between consumer and brokerage, the advanced threat and agreement of broker’s ability to place a lien on a homebuyer’s new home is excessive.

As a home buyer, or any consumer, you should always read and review agreements and contracts and have a full understanding on the terms being agreed to.

It is worth noting, some forms have been cited as being more “consumer friendly” than others. Most notably, the buyer and seller forms produced and used by eXp Realty have earned significant mention from a number of media and consumer organizations:

"Obviously eXp has made some pretty good movements towards a better industry, but we haven’t seen that with other ones. Some of them seem to have the opposite direction."

- Consumer Advocates in American Real Estate

"eXp Realty’s forms leave the choice to offer buyer broker compensation to sellers" - Housing wire

"eXp, a leading national real estate company, just released a “Buyer-Broker Representation Agreement” that is much simpler, clearer, and pro-consumer than [another] agreement. This agreement can serve as a model for how Realtor organizations and brokerages can craft an agreement that is much more understandable and fairer to everyday buyers." - The Consumer Federation of America

“The eXp contract is written with the buyer in mind. [Another] contract is written with the interests of the Realtor in mind.” - The Consumer Federation of America

"Consumer watchdog holds up new eXp seller contract as model" - Inman News

"A new seller contract “Exclusive Authorization and Right to Sell” – that was prepared by eXp.... Like a buyer contract form eXp released earlier, the new seller form is understandable and fair to consumers."

- The Consumer Federation of America