Buyer's Agent, Transaction Broker, or Customer?

When buying a home in Colorado, many buyers don’t realize that there are three different types of relationships you can have with a real estate broker. While all brokers help guide you through the home-buying process, each type of relationship comes with different responsibilities and levels of loyalty to you—the buyer.

For example, your agent might also represent the seller of the home you’re interested in, or they may work in the same office as the seller’s agent. If you're considering a new construction home, should you rely on the builder’s agent, or would having your own Realtor better protect your interests?

Understanding these relationships before speaking with a broker ensures you know exactly what to expect and can make informed decisions with confidence.

Buyer’s Agent

This is the relationship most buyers envision when working with a real estate agent—but in Colorado, it’s legally defined by a contract between you and your agent.

The Exclusive Right to Buy Contract outlines exactly what responsibilities your agent has in representing you, the buyer. Under this agreement, your agent becomes your trusted advocate, working solely on your behalf with utmost good faith, loyalty, and fidelity. That means they’re fully committed to negotiating in your best interest, guiding you through the process, and ensuring you make informed decisions. In short, they’re 100% Team Buyer.

However, because this is a legally binding contract, it’s crucial to read it carefully, ask questions, and consult an attorney, if needed, before signing.

One key detail: Your agent’s loyalty remains intact even if they work in the same office as the seller’s agent—but not if they’re personally representing the seller of the home you want to buy. If that happens, your agent becomes a:

Transaction Broker

A Transaction Broker is the relationship that forms when your agent also represents the seller of the home you want to buy. It can also apply if the brokerage company’s policy requires all agents to act as Transaction Brokers or if no formal contract is signed between you and the agent.

Unlike an Exclusive Right to Buy contract—where your agent is your dedicated coach, fighting for your best interests—a Transaction Broker is more like a referee. They facilitate the transaction, ensure all legal disclosures are made, and remain honest and impartial. However, they cannot negotiate on your behalf or provide advice on your decisions regarding the property.

In essence, a Transaction Broker oversees the process, ensuring everything follows the rules, but they don’t take sides or advocate for either party—just like a referee in a game.

When You Become A Customer

What kind of relationship exists, though, when you fall in love with a model home in a new construction community? If you decide to make an offer on one of those homes without your own real estate broker, you are considered a Customer. The agent you speak with in the showing office represents the interests of the builder only. In this situation, you have the same rights when purchasing a home as you do when purchasing a car. You can, and probably should, consider having a Buyer’s Agent with you when purchasing a new home to protect your best interests in the process.

Basically, a Customer relationship exists at any time you have not agreed to employ an agent. Another good example is when touring an Open House. When you speak to an agent at an Open House, you are a Customer. Therefore, while the agent present would be happy to discuss your home buying goals, it is important not to discuss your personal financial information or details until you define what type of relationship you can have with that agent.

Would you like more information on how an agent represents you when purchasing a home? I would be happy to email you a copy of the Colorado Definitions of Working Relationships Disclosure so you can be prepared before talking to an agent. Email me at penny@pennyshousetohome.com, or contact me on my Facebook page: Penny's House to Home.