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SELLERS
Seller's
Agent
If you are selling real estate, you may want to "list"
your property for sale with a real estate firm. If so, you will sign a
"listing agreement" authorizing the firm and its agents to represent you in your
dealings with buyers as your seller's agent. You may also be asked to
allow agents from other firms to help find a buyer for your property.
Be sure to read and understand the listing agreement
before you sign it.
Duties to Seller:
The listing firm and its agents must:
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- promote your best interests
- be loyal to you
- follow your lawful instructions
- provide you with all material facts that could influence
your decisions
- use reasonable skill, care and diligence, and
- account for all monies they handle for you. Once you have signed the listing agreement, the firm and its agents may not give
any confidential information about you to prospective buyers or their agents
without your permission. But until you sign the listing agreement, you
should avoid telling the listing agent anything you would not want a buyer to
know.
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Services and Compensation:
To help you sell your property, the listing firm and its
agents will offer to perform a number of services for you. These may
include helping you price your property advertising and marketing your property giving you all required property disclosure forms for you
to complete negotiating for you the best possible price and terms reviewing all written offers with you and
otherwise promoting your interests. For representing you and helping you sell your property, you will pay the
listing firm a sales commission or fee. The listing agreement must state
the amount or method for determining the commission or fee and whether you will
allow the firm to share its commission with agents representing the buyer.
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Dual Agent
You may even permit the listing firm and its agents to
represent you and a buyer at the same time. This "dual agency
relationship" is most likely to happen if an agent with your listing firm is
working as a buyer's agent with someone who wants to purchase your
property. If this occurs and you have not already agreed to a dual agency
relationship in your listing agreement, your listing agent will ask you to sign
a separate agreement or document permitting the agent to act as agent for both
you and the buyer.
It may be difficult for a dual agent to advance the
interests of both the buyer and seller. Nevertheless, a dual agent
must treat buyers and sellers fairly and equally. Although the dual
agent owes them the same duties, buyers and sellers can prohibit dual agents
from divulging certain confidential information about them to the other party.
Some firms also offer a form of dual agency called
"designated agency" where one agent in the firm represents the seller and
another agent represents the buyer. This option (when available) may allow
each "designated agent" to more fully represent each party.
If you choose the "dual agency" option, remember that
since a dual agent's loyalty is divided between parties with competing
interests, it is especially important that you have a clear understanding of what your relationship is with the dual agent and
what the agent will be doing for you in the transaction.
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BUYERS
When buying real estate, you may have several choices as
to how you want a real estate firm and its agents to work with you. For
example, you may want them to represent only you (as a buyer's agent).
You may be willing for them to represent both you and the seller at the same
time (as a dual agent). Or you may agree to let them represent only
the seller (seller's agent or subagent). Some agents will
offer you a choice of these services. Others may not.
Buyer's Agent
Duties to Buyer:
If the real estate firm and its agents represent you, they
must promote your best interests be loyal to you follow your lawful instructions
provide you with all material facts that could influence
your decisions use reasonable skill, care and diligence, and account for all monies they handle for you.
Once you have agreed (either orally or in writing) for the firm and its agents
to be your buyer's agent, they may not give any confidential information about
you to sellers or their agents without your permission. But until you make
this agreement with your buyer's agent, you should avoid telling the agent
anything you would not want a seller to know.
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Unwritten Agreements:
To make sure that you and the real estate firm have a
clear understanding of what your relationship will be and what the firm will do
for you, you may want to have a written agreement. However, some firms may
be willing to represent and assist you for a time as a buyer's agent without a
written agreement. But if you decide to make an offer to purchase a
particular property, the agent must obtain a written agency agreement. If
you do not sign it, the agent can no longer represent and assist you and is no
longer required to keep information about you confidential. Furthermore,
if you later purchase the property through an agent with another firm, the agent
who first showed you the property may seek compensation from the other firm.
Be sure to read and understand any agency agreement before
you sign it.
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Services and Compensation:
Whether you have a written or unwritten agreement, a
buyer's agent will perform a number of services for you. These may include
helping you find a suitable property arrange financing learn more about the property and
other-wise promote your best interests.
If you have a written agency agreement, the agent can also help you
prepare and submit a written offer to the seller.
A buyer's agent can be compensated in different
ways. For example, you can pay the agent out of your own pocket. Or
the agent may seek compensation from the seller or listing agent first, but
require you to pay if the listing agent refuses. Whatever the case, be
sure your compensation arrangement with your buyer's agent is spelled out in a
buyer agency agreement before you make an offer to purchase property and that
you carefully read and understand the compensation provision.
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Dual Agent
You may permit an agent or firm to represent you and
the seller at the same time. This "dual agency relationship" is most
likely to happen if you become interested in a property listed with your buyer's
agent or the agent's firm. If this occurs and you have not already agreed
to a dual agency relationship in your (written or oral) buyer agency agreement,
your buyer's agent will ask you to sign a separate agreement or document
permitting him or her to act as agent for both you and the seller. It may
be difficult for a dual agent to advance the interests of both the buyer and
seller. Nevertheless, a dual agent must treat buyers and sellers
fairly and equally. Although the dual agent owes them the same duties,
buyers and sellers can prohibit dual agents from divulging certain
confidential information about them to the other party.
Some firms also offer a form of dual agency called
"designated agency" where one agent in the firm represents the seller and
another agent represents the buyer. This option (when available) may allow
each "designated agent" to more fully represent each party.
If you choose the "dual agency" option, remember that
since a dual agent's loyalty is divided between parties with competing
interests, it is especially important that you have a clear understanding of what your relationship is with the dual agent and
what the agent will be doing for you in the transaction.
This can best be accomplished by putting the agreement in writing at the
earliest possible time.
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Seller's Agent Working With a Buyer
If the real estate agent or firm that you contact does not
offer buyer agency or you do not want them to act as your buyer agent,
you can still work with the firm and its agents. However, they will be
acting as the seller's agent (or "subagent"). The agent can still
help you find and purchase property and provide many of the same services as a
buyer's agent. The agent must be fair with you and provide you with
any "material facts" (such as a leaky roof) about properties.
But remember, the agent represents the seller — not you
— and therefore must try to obtain for the seller the best possible price and
terms for the seller's property. Furthermore, a seller's agent is
required to give the seller any information about you (even personal, financial
or confidential information) that would help the seller in the sale of his or
her property. Agents must tell you in writing if they are
sellers' agents before you say anything that can help the seller. But
until you are sure that an agent is not a seller's agent, you should avoid
saying anything you do not want a seller to know.
Sellers' agents are compensated by the sellers.
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