The Agency Relationship
WORKING WITH A REALTOR®
REALTOR® work within a legal relationship called agency. The agency relationship is between you as client or principal, and the individual licensee as your sole agent. The essence of the agency relationship is that your REALTOR® has the authority to represent you in dealings with others.
Specifically, the Designated Agency has the following duties:
- Undivided Loyalty
- To obey all lawful instructions of the principal
- An obligation to keep the confidences of the principal
- To exercise reasonable care and skill in performing all assigned duties
- To account for all money and property placed in a Designated Agent’s hands while acting for the principal
Both buyer and seller can be represented by their own Designated Agents in a single transaction.
Dual agency occurs when a Designated Agent is representing both the buy and the seller in the same transaction. Since the Designated Agent 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 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:
- The Designated Agent will deal with the buyer and seller impartially
- The Designated Agent will have a duty of disclosure to both the buyer and the seller except that
- The Designated Agent 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
- The Designated Agent will not disclose the motivation of the buyer to buy or lease or the seller to sell or lease unless authorized by the buyer or seller
- The Designated Agent will not disclose personal information, not otherwise necessarily disclosed in the transaction documentation, about the buy or seller to the other party unless authorized in writing.
The Designated Agent will disclose to the buy defects about physical condition of the property known to the Designated Agent.