Oct. 31, 2007
Welcome to the maiden entry of Judy's blog!
You'll find Judy's shoot-from-the- hip, tell-it-like-it-is approach to real estate is refreshing. Plus, she's been in the business for 20 years and has been through the 'cycles' before. Her talk is backed up by years of experience.
When you make a decision to buy a property, whether it is a primary home, a vacation home, or an investment property…does the real estate agent represent you in the transaction?
Agents do not automatically represent consumers who call them to see property. The agents do, however, have an obligation by Federal and State Law to review the options of representation available to you at your first meeting to discuss a particular property.
If you visit an open house, you will see a sign prominently displayed to inform you that the agent represents the seller, not you. You are considered the 'customer'. The seller is the 'client'. The agent must be honest to you, and disclose any known, material defects of the property. However, the agent's fiduciary duties rest with the seller.
What are fiduciary duties? They are the same obligations that attorneys owe their clients. If you choose to have an agent represent you, that agent owes you the duties of obedience to lawful instruction, undivided loyalty, disclosure of material defects, confidentiality, full accounting for funds and reasonable care. Your interests become paramount to the agent. The fiduciary responsibility remains after the transaction ends - after you have found a property.
What does this mean to you, and how do you choose the form of representation that suits you? That will be clear as we discuss your agency options in MA real estate.
When you meet a real estate agent, the agent should give you a form that describes agency representation available to you. The agent should discuss the options so you can make an informed decision.
You can choose to be unrepresented. That means you are considered a customer, and the agent's only responsibility is to be honest and disclose any known defects of the property. If the agent is the listing agent, then the agent represents the seller. The agent can not help you negotiate against the seller, her client, so…keep your cards folded! Nothing is confidential. Actually, the agent has an obligation to tell the seller anything she knows that could help her client negotiate against you.
If the agent is 'showing you around' and does not represent a seller, the agent still does not represent you. The agent is simply considered a 'facilitator' -she represents neither party. She must present properties honestly and accurately but, she can't assist either party in the negotiations.
You can choose to have an agent represent you as a client. The agent will owe you the fiduciary responsibilities mentioned above. When you find a property, the agent will prepare a market analysis and provide you with information to help you determine a negotiating strategy. Since the agent represents you, the agent's purpose is to help negotiate the best price and terms for you.
If your buyer's agent works for the firm that holds the listing you are buying - that agents is your designated agent. This means that the firm has designated another agent to represent the seller. There are two clients in one firm - each represented by an agent in the firm.
If your buyer agent also holds the listing you want to buy, the agent becomes a dual agent - she represents both clients in the transaction. In this position, the agent cannot fully satisfy all fiduciary obligations. For example, the agent can't help the parties negotiate against each other.
If you are in a designated or dual agency situation, you will be informed in writing by the agent involved.
At Pathway Home Realty Group, Inc., we act as 'single' agents. We represent both buyers and sellers, but never in the same transaction. We never act as designated or dual agents. Our clients receive 100% representation, all the time. Instead of being represented by only one agent, all agents in the firm represent our clients.
We have chosen this path because it gives our clients the benefits of all our knowledge and it ensures confidentiality. An agent will never inadvertently disclose confidential information about a client that will later be used against her in a negotiation(for example, that a client has a job transfer or divorce and MUST sell her home.)
At Pathway Home Realty Group, we know it's your move. Call us to receive the representation you deserve!
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