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Buyer Representation Rights

Under Vermont law, real estate agents must provide a State of Vermont Consumer Disclosure form to buyers and sellers. The State of Vermont Consumer Disclosure informs buyers of their right to retain separate representation from a real estate agent. Pursuant to the law, buyers must be presented this disclosure BEFORE A SHOWING.

From a practical perspective many real estate agents wait until they meet the buyer in person at a showing before presenting the disclosure. The problem with this is that if it is the seller's agent that is meeting the buyer to show them the home, the buyer had no opportunity to be informed of their right to separate representation before the showing as required.

Some real estate agents mistakenly believe that by simply showing the property to a prospective buyer they become the procuring cause under Vermont law. This is problematic in light of the practice mentioned above.

The procuring cause of a real estate transaction is entitled to a commission under Vermont law. There can be two procuring causes of a transaction but only one on the buyer's side and one on the seller's side. In the scenario above, where a seller's agent claims that they are the procuring cause, they are essentially arguing that if the buyer seeks the services of a buyer agent subsequent to the initial showing that the buyer will need to compensate the agent out of the buyer's own pocket because they were not the procuring cause of the sale.

As you can see, the buyer is essentially denied the protections afforded by the law because they are not informed of their right of separate representation until it is too late. If the buyer seeks representation after the initial showing, it is possible that no real estate agent will be willing to represent them because there will be a dispute regarding payment for their services down the line.

It seems to me there should be a brighter line rule adopted. Why not have a rule that says a buyer may seek separate represenation from a buyer's agent even after initial contact with a seller's representative and the buyer's agent will be allowed to be considered the procuring cause so long as the the buyer sought the agent's representation within 7 days of the initial showing or prior to an offer being submitted by the buyer. That way the buyer would have an opportunity to seek the advice of a real estate of their own without being disadvantaged.

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