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Are you confused? Agency Disclosure

It is easy for anyone to be confused about whether or not they are being represented in a real estate transaction. Many unrepresented buyers believe that the agent who shows them a property represents them in subsequent negotiations. This natural misunderstanding may arise out of the amount of time an agent typically spends with the buyer and the professionally cordial relationship the agent properly seeks to build. The buyer may confide confidential information to the agent and feel that he or she is being represented in the negotiations as well. However, if the agent represents the seller, he or she is obliged to pass on all relevant information and to represent only the sellers best interest.

To avoid problems with the issue of whom the agent represents, all states have enacted statutes that require an agent to give disclosed agency representation to any party with whom they have dealings but do not represent. This alerts an unrepresented party to the fact that an agent who they have been working with does not represent their interests. Depending on state law the disclosure may be required to be made at first contact with the non-client or customer, or at some other time; it may be required to be part of an offer or contract or a separate written form. A real estate licensee must be knowledgeable about his or her state's particular disclosure requirements in order to provide effective representation and to avoid liability.

Posted by Lynchburg, Roanoke & Danville Area Nannette Saunders ASSOCIATE BROKER on 03/02/2008 07:59 PM

Comments (7)

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This post has been included in Virginia Information

7 Comments on Are you confused? Agency Disclosure

Learned this in Real Estate school today!

03/02/2008 08:01 PM

by Susan Davis, Realtor~Van Buren, Fort Smith, AR Real Estate (Exit Realty Fort Smith)

This is great. It takes a while to grasp agency and I think it takes a while for Job Public to understand it too!

03/02/2008 08:03 PM

by Lynchburg, Roanoke & Danville Area Nannette Saunders ASSOCIATE BROKER (Bradner, Farmer, Towler and Associates)

As real estate professionals, we should make it clear to all consumers, early and often, regardless of the state requirements, whether we represent them or not. Too many real estate agents want to make the sale and will let the buyer babble on about their circumstances without letting them know that anything they say can and will be held against them. It's not enough to say "I represent the seller, not you." Buyers don't really know what that means unless you tell them exacly what that means. Tell them. "You are not represented by me. Do you want to be represented?" Send them to someone who can represent them instead of asuming that they get it. Some buyers don't want representation and will get what they ask for. But at least give them a chance.

On the other hand, if another real estate agent wants to babble on, then let the games begin. I'll use whatever they tell me. They should know better. Consumers don't.

03/02/2008 08:17 PM

by Gloria Ruesch Nebraska-Iowa Exclusive Buyers' Agent (New Idea Realty Services, LLC)

It is FULL DISCLOSURE not disclosure of what I want you to know when I feel you need to.

03/02/2008 08:19 PM

by Lynchburg, Roanoke & Danville Area Nannette Saunders ASSOCIATE BROKER (Bradner, Farmer, Towler and Associates)

We do disclosure of agency in our state as well.

03/02/2008 09:01 PM

by Gary Woltal - REALTOR® Dallas Ft. Worth (Keller Williams Realty)

Unfortunately a significant number of builder's representatives do not disclose this to the Buyers until they're sitting down to Contract! At this point, what is the Buyer to do? They've been promised the moon and sometimes don't even realize that they've received nothing until years after Closing! I do wish that the Commission would make 'spy' visits to these new developments just to see what is REALLY going on! Full disclosure is NOT practiced as it should be here either.