0:00If you've been in real estate for any amount of time, you know that the industry doesn't change often. But when it does, it moves really, really quickly. And a couple of years ago when we had the N lawsuit settlement, it was probably the biggest structural shift in the industry that we've seen in decades. Hey, my name is Chance Brown. I'm the broker owner of CB&A Realtors, and I make video content like this because I am passionate about helping real estate agents build great businesses. And today I want to break down exactly kind of what has changed due to the N settlement, what it means for you and what you need to do in your business and more importantly how to have conversations that are now required. They're not optional of every buyer's agent in the industry. Because here's the truth. The agents that figure this out early and get on top of it are the ones that are going to have a significant advantage. and the agents who keep doing business the way that they've always done it are going to find themselves losing clients that they shouldn't be losing. So, let's get into it. So, let's start with the facts because there's been a lot of noise and a lot of confusion around this and I want to get right through it. N settlement, which took effect in August of 2024, changed two things that matter to almost every buyer's agent out there.
1:16First, sellers are no longer required to offer agent compensation through the MLS. And if you go back in history, that was kind of the purpose of the MLS was this offer of of uniform compensation. It doesn't mean that sellers won't offer compensation. It just means it's not advertised and out there. Most, in our experience at my brokerage, most sellers are still paying buyer agent compensation, but it's no longer a guaranteed line item, and we need to be very, very clear about that. Second, agents are now required to have written buyer representation agreements in place before they go do their business. Now, if you ask me, that should have been something that happened all along. But those two changes together mean that every buyer's agent in the country now has to have something that they largely have been able to avoid in the past, an explicit upfront conversation about their value and how they get paid.
2:07That's uncomfortable for a lot of people, but it doesn't have to be. I'd argue that it really is the way we should have been doing business all along. We probably wouldn't have gotten into this lawsuit mess had we been doing it. And moving forward, it's going to give you a distinct advantage over the people who haven't figured this out. So, here's what I'm seeing in the field right now. Agents fall into kind of one of three categories. Category one is they're just kind of ignoring it and just going on the way that they've been doing it. Head in the sand. It It's not great. I don't like it. I think it's probably setting us up for more trouble in the future, but there's a big chunk of agents doing that. Camp two, they're kind of panicking and freaking out about it. They're discounting commissions. They're apologizing.
2:53They're just training their clients to negotiate them down before the conversation even starts, which is a huge problem and shouldn't be happening. And then there's the third group, and this is the group that I think gets it right, but it's a small group. And what they've done is they've built process around this. They have a locked down way of doing a buyer consultation, buyer interview, whatever you want to call that. They know how to present value and do it very well. They know how to have a conversation around compensation and be confident in how they've earned their money and why they get paid the way that they do. And they're converting buyers at a much higher level than everybody else because those conversations build trust. That's what's so important here is you've got somebody who's hiring you to do a job. Tell them the job you're going to do. Tell them what it costs. Be confident in it and build that trust right out of the gate. Let's talk about that buyer consultation because I think that it is genuinely the foundation of every single step of working with buyers. It shouldn't be optional. It's not just about getting a signature on your buyer's rep. I think a lot of agents go into that with that's the win, but really it's about establishing yourself as the expert in the room. It's about setting expectations. It's about discovery and so much more before you ever put somebody in your car. So, here's kind of some basic structure.
4:16First of all, let's start with them and let's start with their story. We want to know about what's going on with them. What's driving them to make a move right now? What's most important to them in the process? Have a script for that. Take notes. Do that discovery. The more questions that you can ask in this first part, the better because it's going to get them talking about themselves. It's going to help you build commonality and it's going to help you build rapport and trust right out of the gate very early. Then let's walk them through the process. Even if they've bought a home before, even if they've done it recently, things have changed. Things are always changing. So, let's just make sure that your processes match their processes and what we're looking for from start to finish. This isn't a lecture. It's an interactive conversation. Here's what the journey from where you are today to keys in your hand typically looks like. Here are the moments that matter most. Here's where buyers tend to get tripped up and where I help prevent that. And that shows your expertise and that you're the guide. And we know without question, one of the things that people want is a guide. The last part is your compensation conversation. Don't wait for them to ask. Say, "Listen, I want to be upfront with you. I want to talk to you about how I get paid because it's changed recently, and I think it's important that you understand the way that this works." Then explain that process very clearly, how you're compensated, what your agreement says, and what happens in different scenarios. Then close the conversation with a simple ask. Based on everything we've talked about, do you feel comfortable moving forward? That's it. Yes or no? So, let's talk about that compensation conversation because agents tend to really, really dread that. But when a buyer asks, "Why do I have to sign this agreement?" Here's how I'd respond. It's a good question and I understand the trepidation. The agreement does two things. First of all, it protects you. It locks in my commitment to represent your best interest. We call that fiduciary duty.
6:13But also, it protects me. It ensures that I'm not working for free. You wouldn't go to work for free. I have a business to run. I don't work for free either and so it ensures the work I do on your behalf is compensated. Think of it like hiring any other kind of professional. When you hire an attorney, when you hire an accountant, there's an engagement letter. That's what this is. It's an engagement letter for real estate. So, what if the buyer then asks, "Well, what if the seller doesn't pay the commission?" The answer is simple. This is the new reality of the market, and it's a really fair question. In most cases, sellers still offer buyer agent compensation because it's in their interest to do so. But if they don't, we have several options. We can negotiate it in the offer. We can look for properties that do offer and just not go to that house. Or in some cases, you may have to cover it out of pocket. But I will always be transparent with you about where we stand before we make any of those decisions. The key here is as you're having this conversation, being confident in what you're saying. Don't be defensive. You're not apologizing how you get paid. This is your business and you run your business like any other business owner. So, what does this mean for your business long term? Here's the big picture I want to leave with you.
7:23The agents who are going to win in this new environment in the years to come are going to be radically better at demonstrating value. Not just delivering it, but communicating it to. You can have the best processes and systems, but if nobody knows about it, nobody cares. So, you may have done good work for the last however many years you've been in the business and got paid without ever having to really explain why you were worth that. Those days are over. You have got to know what you're going to say to prove your value. And frankly, I think it's a good thing because the ones who couldn't articulate value are the ones who were always kind of the weakest link in the industry anyway. Why should I work with you? If you can't tell somebody that in 30 seconds after asking, you need to practice, practice, practice. That's going to be the most important thing moving forward. So, take that and start building your buyer consultation. Practice your compensation conversation. Stop treating the agreement like something to apologize for. It's not a burden. It's a professional standard. And I want you to own that. Hey, if this was valuable to you, I would be honored if you would subscribe, follow, like, share with one of your friends. And if I can ever be of service to you, please don't hesitate to reach
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