Working with a REALTOR

REALTORS work within a legal relationship called agency. The agency relationship exists between you, the principal, and your brokerage, the company under which the individual representing you is licensed. The essence of the agency relationship is that the brokerage has the authority to represent the principal in dealings with others.

Brokerages and their licensees are legally obligated to protect and promote the interests of their principals as they would their own. Specifically, the brokerage has the following duties.

1. Undivided loyalty. The brokerage must protect the principal's negotiating position at all times, and disclose all known facts which may affect or influence the principal's decision.
2. To obey all lawful instructions of the principal.
3. An obligation to keep the confidences of the principal.
4. To exercise reasonable care and skill in performing all assigned duties.
5. To account for all money and property placed in a brokerage's hands while acting for the principal.

You can expect competent service from your brokerage, knowing that the company is bound by ethics and the law to be honest and thorough in representing a property listed for sale. Both buyer and seller can be represented by their own brokerage in a single transaction.

Dual Agency

Dual agency occurs when a brokerage is representing both buyer and seller in the same transaction. Since the brokerage has promised a duty of confidentiality, loyalty and full disclosure to both parties simultaneously, it is necessary to limit these duties in this situation, if both parties consent.

If you find yourself involved in a dual agency relationship, before making or receiving an offer both you and the other party will be asked to consent, in writing, to this new limited agency relationship.

This relationship involves the following limitations:

1. The brokerage will deal with the buyer and the seller impartially;
2. Te brokerage will have a duty of disclosure to both the buyer and the seller except that:
   1. the brokerage will not disclose that the buyer is willing to pay a price or agree to terms other than those contained in the offer, or that the seller is willing to accept a price or terms other than those contained in the listing;
   2. the brokerage will not disclose the motivation of the buyer to buy or the seller to sell unless authorized by the buyer or the seller;
   3. the brokerage will not disclose personal information about either the buyer or the seller unless authorized in writing.
3. The brokerage will disclose to the buyer defects about the physical condition of the property known to the brokerage.

When There is No Agency Relationship

You may also choose to use the services of a REALTOR without having any kind of agency relationship. This might occur, for example, when you are being shown a property by the seller's agent.

The REALTOR you choose to work with in this manner has a legal and ethical duty to provide you with accurate, honest answers to your questions and can provide all these services:

• Explain real estate terms and practices
• Provide and explain forms used
• Assist you in screening and viewing properties
• Inform you of lenders and their policies
• Identify and estimate costs involved in a transaction
• Assist you in establishing your range of affordability
• Prepare offers or counter-offers at your direction
• Present all offers promptly

A REALTOR who is not your agent cannot:

• Recommend or suggest a price
• Inform you of his/her principal's top/bottom line
• Disclose any confidential information about his/her principal unless otherwise authorized

You should not provide a REALTOR who is not your agent with any information that you would not provide directly to his or her principal.