Working with a Realtor® In the purchase or sale of Real Estate, Realtors® are an essential part. They greatly increase the chances of having a successful and smooth Real Estate transaction. This is because they understand the ins and outs of the real estate process.
A Realtor's® responsabilities to a customers is very different from that of a Client. Which can should drastically effect the type of service you get.
Realtor's client So what makes one person a client and another a customer?
"Agency" or a relationship created between a Realtor® and a Client. When A Realtor® is working for you you are a client and if they are working for the other party involved you are a customer. A Realtor® owes Clients certain duties known as "Fiduciary Duties". These duties are : Accountability
Good Faith / Full Disclosure
(all with in legal limits)
Realtor's customer The duties that a Realtor® owes a client are:
Make no misrepresentation regarding the property.
Be fair and ethical
Make sure that answers are complete and accurate
Why work with a Realtor® At first glance the duties may seem to give similar protections for both clients and customer. However, there is several major differences. The biggest is that a Realtor® works for the client not the customer. Who is paying the Realtor® does not matter. So how does this affect you?
If you are a customer everything that you tell a Realtor®, that might effect the negotiating, must by law be past onto the client. So, if you said that you would be willing to pay the full price, the Realtor® would have to inform his/her client of that fact. This would probably be followed by a statement that your motivation may change before negotiations are done, but the information would still be passed on. If you were a client only factual information about the property or offer is passed on. This would include condition of the home, price being offered and conditions found on the offer.
The Realtor® is bound to work in, and protect, their clients best interest.
Types of AgencySeller's Agency This is when a Realtor® represents you for the sale of your current real estate. This type of agency is usually entered when a listing agreement is signed.
Buyer's Agency This is when a Realtor® represents the you for the purchase of a home or property. This is often entered into with the signing of a Buyer's Agency Agreement. However, agency can be created through verbal agreement or even by the Realtor treating the buyer like a client.
Dual Agency When Buyer Agency was created, in Ontario, in 1995 it also created dual agency. This is when there are more than one client being represented by Realtors belonging to the same brokerage, or different brokerages under a cooperation agreement stating that they are working together with respect to particular properties or clients. Before negotiations can start in a dual agency situation the parties involved with the dual agency must agree to the existence of the dual agency. If anyone does not agree then provisions must be made to ensure that the parties that do not agree get separate representation. The main change between dual agency and the other two types is that the duty of full disclosure is over ruled by the duty of confidentiality. Therefore, written consent must be given for any personal or motivational information to be passed on to the other clients. This protects all parties involved.