What is Your Real Estate Agent's Fiduciary Responsibility to You?

By
Services for Real Estate Pros with YourSiteNeedsMe.com

When you hire a real estate agent, whether you’re a buyer or seller, you’re establishing what’s called a fiduciary relationship. It doesn’t matter whether you’re buying a house in Lake City, Florida or you’re selling one in Nome, Alaska; the point is that your agent agrees to take on certain responsibilities that will help you—and only you—with your transaction.

But what is a fiduciary relationship, and what does it mean to you as a client?

What is a Fiduciary Relationship?

The term fiduciary means “faithful servant,” and it describes your relationship with your real estate agent. Your agent has a duty to represent your best interests, no matter which side of the transaction you’re on.

What Are Fiduciary Duties?

A real estate agent has a handful of obligations to his or her clients; we call them fiduciary duties. Your agent’s fiduciary duties include:

  •          Accounting
  •          Reasonable care and diligence
  •          Confidentiality
  •          Disclosure
  •          Loyalty
  •          Obedience

Fiduciary ResponsibilityAccounting

Your real estate agent has to account for all the funds you entrust to him or her. He or she can’t mix client funds with her own personal or business funds.

Reasonable Care and Diligence

Your agent has to use all of his or her skills, and use them to his or her best ability, on your behalf. He or she must act as a competent real estate professional and work to further your best interests during the transaction.

Confidentiality

Your agent can’t tell the other side anything that may be damaging to your negotiations, and he or she must keep everything about your transaction confidential, too. That means if you’re a buyer, your agent can’t tell the seller’s agent how much you’re actually willing to pay for a home (or, on the other side of the coin, how low you’re willing to go if you’re the seller). Confidentiality doesn’t extend to hiding defects in the property or to misrepresent the property’s condition, though.

Disclosure

Your agent has to disclose any information he or she receives that could benefit your position in a negotiation. He or she has to disclose facts that affect the value or desirability of a property, too.

fiduciary duties in real estateLoyalty

Your agent is required to put your interests above his or her own, and he or she owes you undivided loyalty.

Obedience

Obedience. If you want to do something that might be a little out there, like claim your property is a UFO landing site that’s used on the fourth full moon of every year—provided that it’s legal to do so in your state—your agent has to go along with you. The idea is that the agent must obey all lawful instructions his or her client gives, because ultimately, it’s your transaction. (If you give unlawful instructions, you can expect your agent to tell you no.)

 

 

 

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
Real Estate General Information
Tags:
disclosure
agent responsibility
loyalty
diligence
fiduciary duty
care
fiduciary responsibility
obedience
accounting
confientiality

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainmaker
1,471,626
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

Well done ! Soon you will be teaching the Pre-Licensing courses in your area !

Mar 20, 2017 05:02 PM #1
Rainmaker
103,771
Mary Jo Quay
Remax Advisors - Minneapolis, MN

How about we swap out marriage vows for fiduciary responsibility? there would be a lot less divorce.

 

Mar 20, 2017 05:06 PM #2
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
20,793

YourSiteNeedsMe SEO Team

$399 Real Estate Websites - YourSiteNeedsMe.com
Ask me a question
*
*
*
*
Spam prevention