Your relationship with Realtors you meet on the street!


You have a choice in who you work with when buying or selling real estate...make it a conscious choice!  Whenever you speak to or meet with a Realtor, know who they're working for and what that means to you.

 

Example...You're walking through an open house and you just love the house.  Maybe you'll find yourself gushing to the agent sitting the open house about just how much you love the house and where you're going to put your furniture.  Or the agent simply overhears you tell your spouse how much you love the home.


Stop talking!  The agent that greeted you at the door is working for the seller!  Be careful of what you say about the home and your current situation...in the event that is the home you find yourself wanting to buy, your negotiating power may be quickly going down the drain.  

This may seem like common sense, but in all honesty, a two minute conversation with you can give a savvy Realtor quite a bit of information that may not be in your best interests for them to know.  Please take a few moments to read the information below.  It's in your best interest to understand how agency relationships work.


Agency Relationships


 

Agency is a legal relationship between a client (principal) and an agent (the broker and salesperson) that begins when the client gives authority to the agent to perform acts on the client’s behalf and the agent consents to the delegation. In general, an agency agreement is in the form of a written contract, but this isn’t essential unless it is required by state law.

Types of Agency-Brokerage Relationships With Consumers

  • Seller’s agent .Also known as a listing agent, a seller’s agent is hired by and represents the seller. All fiduciary duties are owed to the seller. The agency relationship usually is evidenced by a listing contract. Once a property is listed, the seller’s agent either can attempt to sell it or, in addition, may be permitted by the seller to cooperate with another licensee who will attempt to find a suitable buyer for the property, A seller’s agent negotiates the best possible price and terms for the seller. The agent represents the seller's best interest throughout the transaction.
  • Buyer’s agent. A real estate licensee is hired by a prospective buyer as an agent to find an acceptable property for purchase and to negotiate the best possible price and terms for the buyer. The agent represents the buyer's best interest throughout the transaction. The buyer can pay the agent directly through a negotiated fee, or the buyer’s agent may be paid by the seller or a commission split with the listing agent.
  • Subagent. A cooperating agent who works for a listing broker-salesperson in the sale of a property. The subagent represents the seller, and therefore, works withthe buyer, but not forthe buyer. The subagent owes fiduciary duties to the listing broker and to the seller. Although subagents can’t assist the buyer in any way that would be detrimental to their client the seller, a buyer-customer working with a subagent can expect the subagent to treat him honestly. A subagent generally may provide the buyer with certain types of services, often called ministerial services, which are factually based and do not require the licensee’s judgment.
  • Disclosed dual agent. Dual agency is a relationship in which the brokerage represents both the buyer and the seller in the same real estate transaction. Dual agency relationships don’t carry with them all of the traditional fiduciary duties to the clients; instead, dual agents owe limited fiduciary duties. The fiduciary duty of loyalty to the client is limited. This focuses on confidentially and the negotiation process. Because of the potential for conflicts of interest in a dual agency relationship, it’s vital that all parties to the dual agency relationship give their informed consent. In many states, this must be in writing. Disclosed dual agency is legal in most states.
  • Nonagency relationshipcalled, among other things, a transaction broker, or facilitator. Some states permit a type of nonagency relationship with a consumer. These relationships vary considerably from state to state, both as far as the duties owed to the consumer and the terminology used to describe the relationship. Very generally, in these relationships, the duties owed to the consumer are less than the complete, traditional fiduciary duties, but in most states which allow for this type of relationship, the licensee still owes the consumer some fiduciary duties.

 


 

 

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