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What is a Homeowner Benefit Agreement and Why You Should be Careful of it When Purchasing a Home?

By February 14, 2023No Comments

A Homeowner Benefit Agreement (HBA) is an agreement where a real estate agent contracts with a property owner for a right to sell her property in the future. The real estate agent offers the property owner a sum of money for that right. The real estate agent then would be entitled to a commission on the sale of the property. The key difference between the HBA and your typical real estate listing agreement is that the regular listing agreement becomes effective immediately, while the HBA does not become operative immediately but in the future, upon the triggering of some event.

HBAs usually contain provisions in it stating that the real estate agent has a lien right on the property for her commission and that that lien “runs with the land.” This means that if the property is sold, and the seller does not disclose or pay the commission under the HBA, the buyer may be on the hook for that commission.

A document titled Memorandum of understanding is usually (or should be) recorded in public records giving notice to title agents of the existence of a given HBA. Upon detection, the title agent for the transaction shall requests from the seller evidence that the commission has or will be paid, and a release from the agent beneficiary of the HBA.

In Miami’s ever hot real estate market, Homeowner Benefit Agreements are becoming more prevalent. It is therefore extremely important that you hired an experienced real estate attorney for your real estate transactions.

For more information about real estate transactions or litigation, contact an experienced real estate attorney at Ayala or email attorney Eduardo A. Maura at or call 305-570-2208.

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