WORKING WITH
REAL ESTATE AGENTS
When buying or selling
real estate, you may find it helpful to have a real estate agent assist you.
Real estate agents can provide many useful services and work with you in
different ways. In some real estate transactions,
This brochure addresses
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 • 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 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.
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.
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.
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.
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.
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 • otherwise
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.
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.
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.
The
919/875-3700 • Web Site: www.ncrec.state.nc.us