For many years, when people wanted to sell their homes in Indiana, they had to sign official agreements with real estate brokers. Now, this requirement also applies to buyers—those looking to purchase a home must also have a written agreement before moving forward with the process. This change is part of a broader effort to ensure fairness and transparency in the real estate market.

Understanding the New Law

This new requirement is one of 172 laws recently approved by Indiana’s lawmakers, and it became effective this month. The law was influenced by a major settlement between home sellers and the National Association of Realtors, to make real estate transactions clearer and safer for everyone involved. The settlement aims to protect consumers by ensuring that they fully understand the terms of their agreements with real estate agents.

The Importance of Professional Guidance

According to real estate professionals, having proper representation is essential, especially in a market that can be both complicated and competitive. In many other states, similar requirements already exist, and consumers generally don’t have issues with them. While this new practice might come as a surprise to some Indiana buyers, it is designed to ensure they are legally protected through a formal contract with their real estate agents.

Changes in Who Pays Commission

In the past, the seller of the home usually paid the commissions for both their agent and the buyer’s agent. However, under the new law, buyers might have to pay their agent’s commission if the seller chooses not to cover it. It’s important to note that buyers can still attend open houses without having an agent with them. This change is intended to create a clear understanding of the roles and responsibilities between buyers and their agents.

Moving Forward in a Changing Market

This new law also clarifies the working relationship between buyers and real estate brokers, specifying the terms of service and how agents are compensated. Experts believe this change will lead to a more balanced approach in real estate transactions, treating both buyers and sellers equally. As the real estate market adapts to these new rules, it’s essential to remember that everything in real estate is negotiable, and buyers should stay informed as these changes take effect.