What Is Agency Confirmation?
Often times, when we, California transaction coordinators, are working on a real estate transaction for an agent and a seller or buyer, we receive an Agency Confirmation (AC) from the transaction coordinator or agent on the other side of the transaction. The question is… why?
If you are using the standard purchase and sale agreements from the California Association of Realtors®, then most of the purchase agreements have agency confirmation built into the purchase contract. For example, the Residential Purchase Agreement (RPA-CA) has the declaration of agency on page one of the contract—right smack dab in the middle of the page as plain as the eye can see!
Then, why do some agents submit the Agency Confirmation form? Well, that’s because the agent thinks that he or she will not get paid if they do not put this form in the transaction? Remember that since the confirmation is already part of the purchase contract, this form is not necessary. (However, if page one of the contract is not completed or if there is a change in agency, then you would need to submit an Agency Confirmation form.)
Changes in compensation can occur. Sometimes there is a change in compensation during the negotiation process or during the transaction. If a change in compensation is necessary, this change should be declared in the Cooperating Broker Compensation Agreement (CBC) and submitted to escrow.
Compensation and Agency Confirmation are two different things. Don’t get them confused. And remember that you do not need to kill two trees to do a real estate transaction. When you use the transaction coordinating services provided by Transaction 911, not only will you save trees but you will save time as well.