When you hire a real estate agent it doesn't automatically mean that they will work for your benefit. Sometimes you will find yourself as the seller but your real estate agent is inclined to help the buyer instead of you. These instances can be prevented if you have an agency relationship with your real estate agent.
According to Real Estate Study Aids, An agency relationship is a relationship in which an agent is authorized to perform certain acts on behalf of a principal. If the agency relationship changes at any time during the transaction, the change must be disclosed in writing, and the party must consent to the change.
Fiduciary relationships are is a legal relationships that creates a position of trust and confidence. A real estate agent under agency must be ACOLD.
- Accountable
- Careful and Skillful
- Obey legal instructions
- Loyal to their clients
- Disclose all pertinent information
A form, "Understanding Whom Real Estate Agents Represent", should be presented by the real estate agent to the buyer during their first meeting as agent-client. These form have the kinds of agency and the client must understand which agency relationship he/she have with his/her real estate agent.
There are several types of agency. Listed here are the two most common type of agency relationship.
Buyer Agency.
This kind of agency occurs when the buyer and the agent form a written contract that the agent represents only the buyer. Confidential and personal information of the buyer cannot be disclosed to the seller of the agent representing the seller. Other benefits from this kind of relationship includes:
- Agents pay full attention to the buyer's need
- Agents tell all information they know about the seller
- They focus on properties that satisfies your needs and wants
- Agents protect and guide the buyer
- Negotiate on your behalf
- Attempts to solve problems to your advantage
Seller Agency
This kind of agency occurs when the seller and the agent form a written contract that the agent represents only the seller. The agent under these agency is legally obliged to share any information he/she know regarding the buyer and to discuss to the seller all details regarding the negotiations for the property.
