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Buying and Selling a Home in Massachusetts| Your Rights as a Buyer or Seller

Massachusetts Berkshire Real Estate| Your Rights as a Buyer and Seller

The purchase or sale of a Massachusetts home is one of the largest transactions that an individual makes during a lifetime. Following years of planning and saving, a Berkshire home buyer begins the process of finding the home of the buyer's dreams. The search is challenging and also an opportunity for change that is exciting.

 The assistance of a qualified real estate agent can transform complex negotiations into a most rewarding endeavor for buyer and seller. This pamphlet is provided as a consumer service to the home buying and selling public and demonstrates the Massachusetts REALTORS'® commitment to promoting home ownership opportunities for all citizens of the Commonwealth.

Exclusive Listing Agreements

Although there are several different types of listings for the sale of real property that an owner may give a broker, the most common in Massachusetts is an "exclusive right to sell" agreement. Under an "exclusive right to sell" agreement the listing broker is given the right to earn a fee for professional services if the property is sold by anyone, including to a buyer located solely through the efforts of the owner.

Multiple Listing Service

Where a buyer works with a real estate agent who participates in a multiple listing service ("MLS"), the agent can cooperate in showing a buyer any property in the MLS, even though it may have been listed through another office.

Agency Relationship

Whether you are the buyer or the seller you can choose to have the advice, assistance and representation of your own agent. Do not assume that a broker is acting on your behalf unless you have contracted with that broker to represent you. If you are a seller you may authorize your listing agent to cooperate with agents from other firms to help sell your property. These cooperating agents may be sub-agents who represent a seller or be agents of buyers. A seller can generally obtain broader exposure for a property by authorizing a listing broker to compensate a cooperating agent who successfully procures a buyer. If you are a buyer you have the option of working with a seller's agent or buyer's agent. The decision will depend upon the types of services you desire and the method of compensating the agent. A broker who is representing a buyer and shows that buyer a property listed with the broker's office is said to be a "dual agent". Dual agency is permissible provided that both buyer and seller have given informed consent. The duties of a real estate licensee do not relieve the consumer of the responsibility to protect his/her own interest. If advice is desired regarding legal, tax, insurance or other matters, a professional in those areas should he consulted. Regulations of the Board of Registration of Real Estate Brokers and Salespersons require that written notice of the agency relationship of a real estate agent be provided to buyers and sellers at the first personal meeting to discuss a specific property. The buyer and seller are asked to sign an acknowledgement of receipt of the notice.

Real Estate Agents Are Not Inspectors And Do Not Guarantee Property Condition

Real estate agents are not trained to find structural, electrical, plumbing, septic and other problems with a home or land and do not guarantee the condition of property they sell. In general, agents have no duty to inspect a property for defects and have no duty to verify information received from sellers, municipal departments or other reputable sources. Naturally, real estate agents may not "knowingly (make) any substantial misrepresentation" ( MGL c. 112 section 87AAA(a)). Agents have no liability for innocently passing along to buyers information from reputable sources, even if it is later determined to be inaccurate. Agents who provide buyers with names of lawyers, accountants or other professionals do not automatically guarantee the accuracy of the reports of those professionals. Since May 1, 2001 home inspectors have been required to be licensed by the commonwealth and to carry errors & omissions insurance. A complete list of all licensed home inspectors is available from the state's Division of Professional Licensure.

Legal Requirements for Transaction

Contract Requirements

Agreements for the purchase of real property generally must be in writing and be signed to be enforceable. An offer signed by the buyer that includes all essential terms and which is accepted and signed by the seller can constitute a binding contract. A written counteroffer made by the seller that is accepted in writing by the buyer can also constitute a binding agreement. Many real estate agents have forms of such agreements for use by clients and customers. Often a more detailed agreement known as a "Purchase And Sale Agreement" ("P&S") will be signed by the buyer and seller after an offer has been accepted. The P&S will then replace the earlier agreement. If you are unsure of your risks and responsibilities under any proposed agreement you should contact a qualified attorney to assist you.

Deposit By The Buyer

It is customary for a buyer to give a deposit or binder as a show of good faith at the time an offer is presented. While the amount is negotiable, it is typically 5 percent to 10 percent of the purchase price. Normally this deposit is held in escrow, but not deposited until the seller has accepted the buyer's offer.

Mortgages And Financing Contingency

If it will be necessary to obtain institutional financing for the purchase, the buyer must fall within lender's guidelines to qualify for a loan. Loan packages, mortgage interest rates, points (pre-paid interest or administrative fees) and terms vary from one financial institution to another and will be adjusted from time to time. If institutional financing for a purchase is required, the buyer may wish to make an offer contingent upon receipt of a mortgage commitment within a specified period of time. Careful compliance with the exact conditions in a mortgage contingency clause is crucial.

Title Examination And Title Insurance

Most banks and mortgage lenders require that an examination of the seller's title to the property be conducted to determine if the property is marketable and will provide adequate security for the loan it is making. Lenders generally require title insurance up to the amount of the loan and for an additional fee, title insurance can be obtained to protect the portion of the purchase price that the buyer paid.

Miscellaneous Information

Zoning And Building Code Compliance

Zoning refers to the right of a local city or town to regulate the use of a particular property. It can include whether the use may be residential, commercial or industrial; the number of dwelling units which may be located on a lot, the minimum lot size; the minimum amount of street frontage; the minimum distance a structure must be set back from the street, from the side lot line or from the rear lot line. Structures which conformed to zoning at the time they were built may be "grandfathered" in under current zoning, while structures which did not conform when built usually require a "variance" from the city or town in order to be legal.

Often homes are advertised as containing extra apartments. Such an apartment may be called an "in-law" apartment, an "au pair" suite or by some other name. Generally this refers to a structure which has been converted to add a separate dwelling unit. The buyer may wish to determine from the city or town whether such use has been approved.

Who is a Realtor?

All licensed real estate agents should act in a fair, professional and ethical manner. However, not all real estate agents are REALTORS®. Real estate agents who are REALTORS® subscribe to a national code of ethics that helps to assure the fairness, integrity and professionalism of all REALTORS®. In addition, they are members of the Massachusetts Association of REALTORS® a trade organization comprised of real estate professionals from every city and town in Massachusetts.

REALTORS® may also hold professional designations, such as, Graduate REALTORS® Institute (GRI), Certified Residential Specialist (CRS), and Certified Buyer Representative (CBR) which demonstrate additional industry training or a concentration in a specialty area of real estate practice.


This pamphlet is published for voluntary use and distribution by members of the Massachusetts Association of REALTORS® . Distribution is not required, but is entirely discretionary. Publication of the information contained in this pamphlet does not create an attorney client relationship and is not a substitute for consultation with a qualified real estate attorney. In any transaction there may be other obligations you may have and measures you may wish to take to protect your interests. You should consult an attorney for legal advice concerning any particular transaction.