What Does Agency Mean In Real Estate
What Does Agency Mean In Real Estate...well the short answer is that it's the relationship between an agent and a principal or client in a transaction. With some agency relationships there is a fiduciary element which not only implies, but is written into law a relationship of trust and confidentiality.
There are different levels of agency that may be implied or express. The strongest or highest form of agency is the Universal Agent that can represent a client in any transaction. Next, is the General Agent who represents a client in specific business activities. A Special Agent represents a client in a specific transaction. The Special Agent is usually the broker hired by a buyer or seller in most real estate transactions. The Designated Agent is an agent who hangs his license with the broker and represents the client. This agent has a fiduciary agency with the client and is the only agent in the brokerage who does which allows other licensee's in the same brokerage to represent clients/principals on the other side of the same transaction.
As stated earlier, agency can be implied or express. Expressed agency can be written or oral while implied agency is created by the action of the agent and client or principal. For instance; if a for sale by owner offers a 3% commission to agents who procure a viable buyer...that offer establishes an implied relationship. Agency relationship may be terminated by mutual agreement, abandonment or an agent may quit or discontinue the agency as well as the client, or by fulfillment of the agents duty to the client. Some scenarios may create a breach of contract with the possibility of a law suit.
Whether an individual is being represented or not, real estate agents are held to a standard of treating all parties with honesty and fairness and proper disclosure of any know fact. However, an agents main focus and fiduciary responsibility is to his or her client. The agent owes his client; care and skill, obedience within the frame work of the law, account for all monies and loyalty to the client putting the clients needs and interests before all others including the agents.
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