Form 220 – Is It Required?

Q: I’m a buyer’s agent and submitted an offer to the listing agent. The property is listed in the MLS and compensation is offered to buyers’ agents. The listing agent says I  must submit that “confirmation of compensation” form before she will give the offer to the seller. The listing agent says that’s her office policy, no exceptions. She says that if I  don’t submit that form, that I have to give her a copy of my buyer agency agreement! I participate in the MLS and I’m not asking for compensation other than what’s offered in  the MLS, so I didn’t think that compensation form was mandatory anyway. What’s the deal?

A: I think you are referring to NCAR Form 220, “Buyer Agent’s Confirmation of Agency Relationship and Offer of Compensation.” There are “Guidelines” on how and under  what circumstances you should use Form 220. Depending on what media you select for the form, the Guidelines appear on the reverse side or second page. The Guidelines  make it clear that use of the form is not mandatory. It should never be attached to or referenced within the Offer to Purchase & Contract. If (1) you participate in the MLS; (2)  the property is listed in the MLS; (3) there is compensation offered to buyer’s agents in the MLS; (4) you are willing to accept that compensation; (5) you have confirmed your  status as a buyer’s agent in writing by checking the appropriate box at the bottom of the Offer; and (6) there are no other fees-bonuses, etc.- that you are receiving in  connection with the transaction, then there is no need to use Form 220. That probably covers 90% of all residential transactions involving buyers’ agents. It doesn’t hurt  anything to use Form 220 in that scenario, it’s just not necessary. A firm might have an internal policy that where the firm is acting as a buyer’s agent, their agents submit  Form 220 to the listing agent. That’s fine, but do not expect it to come back signed in every scenario, especially in the routine case, and do not make the submission of an  executed offer to purchase contingent upon your receipt of that form back from the listing agent. Alternately, a firm cannot require a buyer’s agent from another firm to submit  Form 220 on the firm’s listing, “no exceptions.” A listing firm may certainly instruct its agents to ask for it from the buyer’s agent, but the firm may not refuse to present the  executed offer to the seller over it. The Real Estate Commission rules require agents to immediately deliver executed offers to the parties thereto; the Commission’s rules do not permit listing agents or buyer’s agents to “hold” offers either because the buyer’s agent did not submit Form 220 to the listing agent or because the listing agent did not  return a signed Form 220 back to the buyer’s agent. Finally, a buyer’s agent is not under any obligation to provide the listing agent with a copy of the buyer agency  agreement. The buyer agency agreement is a contract between the buyer and the buyer’s agent; it has nothing to do with the listing agent. The Commission’s rules only  require that you disclose your status as a buyer’s agent at initial contact with the seller or seller’s agent and confirm that status in writing no later in time than the delivery of  the offer.