When you’re ready to begin your home search in Arizona, one of the first documents you may encounter is the Buyer-Broker Exclusive Employment Agreement. This important contract establishes the professional relationship between you (the buyer) and your real estate agent, outlining the terms of their representation and compensation.
While many buyers are eager to skip directly to looking at homes, understanding this agreement is crucial, as it creates binding legal obligations for both parties. This comprehensive guide will walk you through every aspect of the Arizona Buyer-Broker Exclusive Employment Agreement, empowering you to enter this relationship with confidence and clarity.
The Arizona Association of REALTORS® Buyer-Broker Exclusive Employment Agreement is a standardized contract that officially establishes a professional working relationship between a homebuyer and a real estate broker. Updated as of February 2025, this document:
At its core, this agreement means your chosen broker becomes your dedicated representative in the real estate marketplace, working specifically for your best interests throughout your home-buying journey.
You might wonder why a formal contract is necessary, especially if you’ve already been working informally with an agent. There are several important reasons:
The agreement officially establishes that the broker represents you and your interests. Without this agreement, the agent might legally be considered a subagent of the seller in some circumstances, creating potential conflicts of interest.
The exclusive nature of the agreement ensures your broker will commit time, resources, and expertise to your home search. They can confidently invest in researching properties, coordinating showings, and conducting market analyses knowing they have a committed client.
The agreement clearly defines how and when the broker will be paid, avoiding misunderstandings later in the process.
In Arizona, REALTORS® are required to have a written agreement before showing a home to a buyer, as noted in the very first section of the document: “Notice to Buyer: All REALTORS® are required to have a signed written agreement prior to showing a home to a buyer.”
Let’s examine each component of the Arizona Buyer-Broker Exclusive Employment Agreement to understand exactly what you’re agreeing to when you sign.
The agreement begins by identifying:
What to Know: The agreement is technically between you and the brokerage firm, not just the individual agent. This means if your agent is unavailable, another agent from the same brokerage can assist you under the same agreement.
This section establishes the duration of your relationship, specifying:
What to Know: The agreement duration is fully negotiable. While six-month terms are common for general home searches, you might negotiate a shorter period if you’re focused on a specific property or a longer term if you anticipate an extended search.
Example: If you’re relocating from another state and expect your home search to take 8-12 months, you might negotiate a longer initial term to ensure continuity of representation throughout your search.
This section outlines:
What to Know: Be as specific as necessary about your property requirements, but allow enough flexibility for your agent to show you appropriate properties that might not precisely match your initial criteria. This section can be amended later if your search parameters change.
This part confirms the nature of representation, typically referencing the Real Estate Agency Disclosure and Election form, which outlines the different types of agency relationships possible in Arizona real estate transactions.
What to Know: In most cases, you’ll establish a buyer’s agency relationship, meaning the broker works exclusively for you. However, in some situations, you might agree to a limited dual agency, where the broker represents both you and the seller of a specific property (with full disclosure to all parties).
These critical sections cover:
What to Know: If you visit new construction or open houses without your broker, sellers might refuse to pay your broker’s commission, potentially creating compensation complications.
This section clearly states that broker compensation is not set by law and is fully negotiable between you and the broker. It details:
What to Know: While sellers typically pay buyer’s broker commissions through the MLS cooperative arrangement, this section establishes your obligation to pay if the seller doesn’t fully cover it. The agreement often includes provisions for specific circumstances, such as VA loans where regulations govern compensation arrangements.
Example: If you agree to a 3% commission but purchase a property where the seller is only offering 2.5%, you might be responsible for the 0.5% difference unless you negotiate otherwise.
These provisions outline the broker’s right to compensation in special circumstances:
If you breach the purchase contract or voluntarily decide not to proceed with an accepted offer, you may still owe the broker compensation.
This section, often called a “protection period” or “safety clause,” states that if you purchase a property shown to you by the broker within a specified time after the agreement expires (typically 30-180 days), you still owe the broker compensation.
What to Know: This clause prevents buyers from waiting until the agreement expires to avoid paying the broker. However, the time period and terms are negotiable.
These sections address legal and practical aspects of the broker’s business:
What to Know: Even with exclusive representation, your broker may work with other buyers. If multiple clients are interested in the same property, the broker must disclose this conflict and handle it according to ethical guidelines.
This important section clarifies that the broker is not qualified to provide legal, tax, or financial advice. It releases the broker from liability related to third-party professionals you might hire during the transaction.
What to Know: While experienced agents often have general knowledge about these areas, you should rely on specialized professionals for legal, tax, or financial advice specific to your situation.
This section establishes how disputes between you and the broker will be handled, typically through:
What to Know: Agreeing to ADR generally means giving up your right to sue in court, with limited exceptions. This approach typically provides faster and less expensive resolution of disputes compared to litigation.
This section allows for any special terms or conditions not covered elsewhere in the standard agreement.
What to Know: This space can be used to document any unique arrangements or additional services the broker has agreed to provide.
These provisions establish that:
What to Know: If a dispute arises and proceeds to formal resolution, these provisions determine which state’s laws apply and who will bear legal costs.
The final sections include:
What to Know: All buyers with an ownership interest should sign the agreement to ensure full legal protection for all parties.
While Arizona law doesn’t explicitly require a written buyer-broker agreement, the document itself states that “All REALTORS® are required to have a signed written agreement prior to showing a home to a buyer.” This requirement comes from professional standards established by the National Association of REALTORS® and is enforced by local REALTOR® associations.
Technically yes, but most qualified brokers will be reluctant to invest significant time and resources without an exclusive agreement. Non-exclusive arrangements often result in reduced service levels and can create confusion about representation.
The standard agreement doesn’t include specific early termination provisions, but many brokers will agree to mutual termination if the relationship isn’t working well. Consider negotiating an early termination clause before signing.
No. The agreement obligates you to work exclusively with the broker if you decide to purchase, but it doesn’t require you to complete a purchase during the term.
Yes. If you’re already considering specific properties, you can negotiate to exclude them from the agreement, particularly regarding compensation. This should be documented in the “Additional Terms and Conditions” section.
Situation: After signing an exclusive buyer-broker agreement, your cousin tells you about his neighbor selling a home that sounds perfect. The neighbor hasn’t listed it yet and suggests you could save money by dealing directly without agents.
How the Agreement Applies: Your agreement obligates you to involve your broker in any property you wish to purchase during the term. If you purchase directly from the neighbor, you’d likely still owe your broker the agreed-upon compensation.
Best Approach: Introduce your broker to the situation. They might negotiate a reduced fee since less work is involved, but attempting to circumvent the agreement could result in legal obligations to pay the full commission plus potential legal fees.
Situation: Your six-month agreement expires after an unsuccessful search. Two weeks later, you revisit a neighborhood your broker showed you, find a new listing, and purchase it without contacting your former broker.
How the Agreement Applies: If your agreement included a 90-day protection period after expiration, you would still owe compensation to your former broker for this purchase, as it resulted from their introduction to the neighborhood.
Best Approach: If you want to purchase a property related to your broker’s efforts during the protection period, contact them to handle the transaction. If you prefer to work without them, transparent communication and negotiation about compensation may prevent disputes.
Situation: You find your dream home, but the seller is offering only 2% commission to buyer’s brokers instead of the 3% specified in your agreement.
How the Agreement Applies: Typically, you would be responsible for paying the 1% difference unless otherwise negotiated.
Best Approach: Discuss options with your broker. Possibilities include:
While the Arizona Association of REALTORS® provides a standardized form, nearly every aspect of the agreement is negotiable. Consider these points during your discussion:
Negotiate a term that aligns with your expected timeline. If uncertain, consider starting with a shorter period (60-90 days) with extension options.
Be specific enough to focus your search but broad enough to include viable alternatives.
Consider various approaches:
Add a clause allowing either party to terminate with written notice (typically 7-30 days) if the relationship isn’t working.
Negotiate the length of time and scope of the protection period after expiration. 30-60 days is often reasonable compared to the standard 90-180 days.
Identify specific properties you’ve already found that should be excluded from the agreement.
Consider adding specific service commitments from the broker, such as:
If you’re hesitant to commit to a full exclusive agreement, there are alternatives:
This more limited agreement establishes representation for viewing specific properties but doesn’t create the same level of exclusivity or duration commitment. It’s particularly useful for buyers who want to “test drive” working with an agent before committing to a longer-term relationship.
Some brokers may offer non-exclusive agreements that allow you to work with multiple agents, though these are less common in practice.
For buyers focused on a single property, an agreement limited to that specific transaction may be negotiable.
The Buyer-Broker Exclusive Employment Agreement creates the foundation for a successful working relationship with your real estate professional. Rather than viewing it as an obstacle or unnecessary formality, recognize it as a tool that:
Before signing, take time to read the entire document, ask questions about any unclear sections, and negotiate terms that meet your specific needs. Remember that while the form is standardized, most provisions can be modified through mutual agreement.
A thoughtfully negotiated buyer-broker agreement benefits both parties by establishing clear expectations and creating the framework for a productive professional relationship. With the right agreement in place, you can move forward confidently in your home search, knowing exactly who represents you, what services they’ll provide, and how they’ll be compensated for their expertise.
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