When working with a REALTOR® there is a legal relationship formed called ‘Agency’ when you decide to have them work on your behalf.
Anyone that is working on your behalf as your agent has certain responsibilities to you as their client.
- Undivided Loyalty
- An Agent acting on your behalf must at all times act solely in your best interests. This also means that the Agent must put their own interests aside and looking out for your interests first before other parties.
- Anything that is not required by law to be disclosed must remain confidential at all times even after the Agent/Client relationship comes to an end.
- Full Disclosure
- Any facts known to the Agent must be disclosed to you no matter what the Agent feels is significant or not. This is not for the Agent to decide. Basically if it is known to them it must be known to you.
- As funny as this one sounds the Agent must obey all your lawful, reasonable and ordinary instructions.
- Reasonable Care and Skill
- An Agent who is working on your behalf must exercise care and skill in performing all duties asked of them.
- Full Accounting
- All money and property placed in the hands of the Agent must be fully accounted for while acting on your behalf.
There are a number of different types of Agency Relationships that can be formed and understanding which type you are about to enter into is very important.
One party is represented by one Agent (Brokerage or Associates) and the other party is represented by a completely separate and independent party. This is one of the most common form that you will encounter.
Transaction Brokerage (formerly known as Dual Agency)
In this type of Agency Relationship both parties are represented by the same Agent. In this scenario there are actually two ways that this can occur. It is either the same person that represents both the seller and the buyer or it could also be two individual Associates in the same office as the Brokerage is deemed to be the Agent in that case.
In the cases where this type of Agency occurs all parties must fully and voluntarily agree in writing that this is acceptable.
Customer Status (Non Agency)
This would be the situation where you do not want to work with an Agent working for you. This could be the case if there is a conflict of interest that could arise.
When you start working with a REALTOR® they will provide you a copy of the Agency Relationship Guide. It is an acknowledgment that you understand their role as well as yours when working together.
If you would like you can View the Agency Relationship Guide.