Broker NDA agreements

David - this is a really good video. Your comment about the buyer's leverage (willingness to walk away) is spot on, I'm glad that I came across this.

Good video, David. However, I have to disagree with you on a couple of points.

1. The Non-circumvention language in Broker NDAs (particularly CABB version) only holds the Buyer responsible for Broker fees if they specifically go around the Broker or interfere with the Broker's ability to collect a fee from the Seller. Ex. Advising the Seller to wait until the Representation Agreement expires before selling to them and keeping it confidential from the Broker to save Broker Fees. As long as they are working through the Broker, Buyer will not be responsible for Fees. The NDA clearly says that the Seller will be responsible for Fees. Any other violation of the NDA by the Buyer will NOT lead to them being liable for Broker Fees. If a Searcher asked me to waive this clause, it would be a huge red flag and indication of their intent to circumvent me.

2. As for Proof of Funds, I agree that we don't need a full Financial Statement at the early stages. Providing POF showing adequate funds for the transaction would be sufficient. However, I'd say they should show more than just the minimum required downpayment. Otherwise, the Broker and Seller could be concerned that they are too weak to get the deal done. Lender may want to see more liquidity and know that they are not going to be bone dry after Closing the deal. The landlord will need to see additional Proof of Funds to qualify for the lease. If every last penny on their bank statement iis going to the downpayment, they won't get approved by the landlord.