Real Estate Blog - Do you have a client, or a customer?

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Do you have a client, or a customer?

Do you have a client, or a customer?

Do you have a fiduciary relationship with your client? Or are you a transaction broker as we are in Florida for the most part?

Clients have a fiduciary relationship with their Realtor. Customer's on the other hand are working with a transaction broker.

Do you know the difference as an agent?

Yes, client sounds better and I like that word as well. However, if you are a transaction broker, you have a customer. If you have a fiduciary relationship with someone, they are your client.

Do you use the right terminology?

Do you understand the difference...you need to and you should.

Please tell me your thoughts.

If you need any information on a condo or home in Broward County, ocean front or Intracoastal units, feel free to call me anytime.

http://www.KarenMonsour.com, 954-464-4194 cell.

Posted by Karen Monsour,REALTOR® Broward,Palm Beach,Miami/Dade! 954-464-4194 anytime! on 04/17/2009 09:10 PM

Comments (16)

Clients or Customers in the ActiveRain Channel

karen monsour, clients, customers, fiduciary relationships, terminology

Originally posted at: Karen@ www.KarenMonsour.com: Do you have a client, or a customer?

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16 Comments on Do you have a client, or a customer?

APR

Hi Karen

Very informative post, thanks for sharing.

Good luck and success.

Lou Ludwig

Karen, this is one challenging issue for us as Florida agents. We have to be very careful with our terminology and our boundaries. As a transaction broker, it is our job to educate buyers and sellers so they can make a good decision. I personally dislike the word 'customer' very much because it sounds like I'm selling groceries or dresses. Wish we could find another word.

I understand the theory behind why our state and a few others have transaction brokerage - seeing as how agency relates back to British common law and makes the agents responsible for the actions of the other agent and their fiduciary and also the fact that if my client tells me something, it is assumed that every agent in my company knows what he has told me. There certainly have been less lawsuits since transaction brokerage removed those aspects of working with buyers and sellers.

Hi Karen - Interesting. You say that most brokers in Florida are Transaction Brokers. How is that distinction made? Is it a choice?

Lou,

Thank you.

Frank and Sharon,

I agree, I hate the word as well, but a customer is what we have as transaction brokers.

Laguna Homes,

Sorry, I don't know your name.

A transaction broker works with the buyer and seller with no fiduciary relationship.

A client on the other hand has a fiduciary relationship.

Transaction brokers do not.

Hi Karen, good points indeed. It is hard sometimes to realize your role and that can lead to trouble. I like the new rule that all can assume a transaction role unless informed otherwise.

Karen,

If we have a signed Listing Agreement representing the seller, or a signed Buyer'sRepresentation Agreement representing the buyer, the signers are our clients. Anyone else we deal with is a customer.

Charles,

We all need to understand the language we use when dealing with people. Client is a nicer term than custome, however, we need to use the right terminology, lest we get ourselves into a fiduciary relationship...

Wayne,

Unless you have a fiduciary relationship, you have a customer, no matter if you have a listing agreement or not. A buyer's representation agreement unless you are working as a single agent is not a client. We are transaction brokers, unless stated otherwise.

Interesting, you always hear business owners saying, "our clientele..." when they want to sound upscale, and "our customers..." when they are less so. I did not know the difference, and am guessing as a stager, (and not bound by any Realtor rules), I COULD use either, but it is something to think about...

APR

Interesting discussion which of course will have a somewhat different inference depending on the state where one conducts business. In Kansas we start out as either the Buyer's Rep or the Seller's Rep as mandated by Kansas Agency law. Although the prospect of getting paid for both sides of a transaction is tempting, if there is any likelihood that the interests of buyer and seller are different (and they almost always are) I believe the prudent course of action is to involve another agent to handle the other side of a transaction. By doing this you can maintain the client relationship in good faith.

Having said this my goal for every client I represent is to earn the title of FRIEND. I believe I can best represent my clients by gaining their confidence to the extent that they think of me as a friend in whom they can confide, one who is genuinely interested in their welfare. If I achieve that goal and then I demonstrate to them by staying in touch after the sale is closed that I continue to be interested in their welfare, they will not forget me when they have future real estate needs or their family or friends need a REALTOR®.

Cheryl and John,

If you have a client, you have a fiduciary relationship with that individual. If you have a customer, you do not have a fiduciary relationship, you are acting as a transaction broker.

It's important to differentiate between the two as if you call a customer a client, it makes you a single agent and not a transaction broker.

Karen,

In under Texas rules, the standard Buyers Rep Agreement does hold that the agent has a fiduciary responsibility to the client. The buyer client has an obligation to work exlusively through the Broker with whom they sign the Buyer's Rep Agreement.

Wayne,

Interesting how differing states vary. Thanks for the information!

Have a great weekend.

APR

I've always looked at someone as a customer if they are buying me or something directly from me that I have already bought. Say if I bought a toaster and then resold it to you, then you would be my customer. If you are using my services to help you, then it is a client.

Todd,

The definition of a client is a fiduciary relationship. A customer in FL where most of us are transaction brokers are customers. The difference is $$$. Transaction brokers represent both sides.

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