Double sided transaction should require hazard pay.

Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

 Hi folks. Today I want to play the "what would you do?" scenario game. The following, is a scenario that could happen to any of us so I'm curious to how you would handle it. What would you do if.........

First, business has been kind of slow. You're still making money but deals are far and few between and a really good closing would be a very good thing. You've been working very hard but have been supplementing your income with credit cards.

You have a listing. You took this listing several months ago as a single agent and just haven't had any luck getting it sold. The market is slow and houses of this style and price range are just not selling. The listing agreement expires in a week and even though you and the Sellers are on great terms they probably will not renew with you. It's priced at $400,000 which is very good for this particular market.

You are also working with some Buyers you met about a week ago. They met with a mortgage broker that you trust and he has them "sort of" approved. This means they are approved but very marginal. If rates go up or their FICO score or ratios move just a fraction they could be kicked out of the market. So it's about a 50/50. They're nice folks though and you want to try and help them get into a home. So they sign a BBA and you are working for them as a single agent.

After a week or so, of showing them properties, they show up at your office with a print out from It's your listing that we mentioned above. They want to see it. (OK I'm going to skip the agency options for a minute). So you show them the house and they love it!!! They want to write up an offer.

You write up the offer and present it to your Seller(or do you?). The terms are acceptable to the Seller but the Seller ask you "What do you think? Are the Buyers qualified and will this deal close?"

Here's the scenario: First, depending on your State's laws, you will be in a Dual Agency or a Transaction Brokerage relationship at this point. This assumes, of course, that you are trying to double side the transaction. If you do double side it and it closes, the Buyer and Seller will be happy and you'll make $24,000. If you don't do the deal OR it doesn't close, you will be losing the listing anyway.

So what would you do? How do you answer the Seller's question knowing it's a 50/50 chance? Do you try to double side this transaction? Remember in a Dual Agency or a Transaction Brokerage relationship you can NOT work one side to the detriment of the other. You must be unbiased. Also, since you have already established a representation/agency relationship with the Buyer and the Seller reverting back to a non-agency or non-representative relationship is not an option, if you want to double side the transaction.

Now folks, bear in mind that I am a Florida Broker. Dual Agency is illegal in my State. BUT, it hasn't always been. I have practiced Dual Agency so I do know how it works. Also, I don't know if there is a right or a wrong answer. I'm looking for what you would do in this situation. So have at it. I will save my opinion until later. What would you do?

Here are some additional posts on Agency written by Broker Bryant.

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Comments (64)

Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Bill, Dual agency is illegal in Florida. I am NEVER an agent for either party. I wrote this post to stir up a conversation on dual agency. I totally agree once you have created an agency relationship you can't just change it and forget about it and that is my biggest issue with dual agency. Because that is exactly what practicing dual agency is is taking away something you have already given. And when what you have given is fiduciary(and are now limiting) we are walking on a very slippery step.

Rod, Thanks for clarifying COLD for me. I guess I was sleeping during that day of licensing class:)

Allison, You are correct. In fact if working as a TB for both parties we are actually more of a facilitator for the buyer and the seller. Just don't say I'm representing the transaction and I'm OK:)

Kelly, You get it. My issue is that in order to get it and do it right you have to do this: "Present all the facts, disclose everything you can, then give the parties the opportunity to decide for themselves if they are willing to accept that risk." My question is why are we calling that an agency relationship? Where's the counseling? Where's the loyalty? Where's the obedience? I'll tell you where it when out the window when we became a "dual agent". Our Seller had it and now we have taken it away.  That to me is where the problem lies.

Bob, You wrote this: "I would be forthright with the seller and tell them exactly what the facts were."  If you are acting as a dual agent you have just limited your ability to be forthright with the seller.

Aug 16, 2007 08:17 AM
Kelly Sibilsky
Licensed Through Referral Connection, LTD. - Lake Zurich, IL

Bryant, as you can see from all of the above comments, we could all go round and round about agency, dual agency, fiduciary responsibilies, etc. because everybody has a different opinion about whether they are comfortable undertaking it, refuse to do so, or whatever. Which is fine! In my opinion as a former legal professional, the people who are most uncomfortable with it feel that way because they don't fully understand what they can and cannot do and are worried that they will do something wrong and get themselves in trouble. A very valid concern, BTW. Personally, I think we should all do what we are comfortable with (so long as it's legal and you follow the letter of the law) and let others do the same, instead of labeling one "right" and one "wrong." Not that you said this or implied this...but others sometimes do.

That being said, even attorneys sometimes represent both parties in a long as both parties have already come together and basically decided on the division of assets, etc. Can it create a conflict? Sure, the possibility is there. But the attorney is there to make sure the legalities are covered and that both parties are equally represented, not to advocate for either of them. Dual agency is similar.

I think the hang up is on the word "agency" itself. Perhaps the term"dual agent" should be changed to "transaction facilitator" or something that doesn't mention the word "agency". Or maybe the term "agency" (when referring to representing a single party) should be changed to the word "advocate." We need terminology that more clearly defines the role we play in each circumstance.

Is it in the best interest of either party? Maybe and maybe not. It truly depends upon the parties involved and their knowledge and experience. One of my dual agent buyers had an attorney for a father...and even he was comfortable with me being a dual agent for his daughter. Go figure.

Aug 16, 2007 09:02 AM
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Kelly, That's an excellent comment. I had not looked at in the context of an Attorney handling a divorce. Very good analogy. I agree about the word "agency". Thanks you for your very good thoughts.

I do want to mention that I have practiced dual agency before it was made illegal in Florida. I understand it and I am capable of performing this way. My concerns are really geared more towards the consumer. It seems whenever I have these discussions it's always about how WE feel or what WE can or cannot do. When the reality is it should be about how it affects the consumer AND do THEY fully understand the ramifications of letting their agent switch to a dual position after they have hired them as a single agent. It's the switch in the level of agency that concerns me. And it would certainly concern the consumer if they were fully aware of what it meant. There's a lot more to it than just getting a form signed and moving forward.

It seems to me that dual agency is completely to our advantage. Where does the consumer benefit?

Aug 16, 2007 11:02 AM
Kelly Sibilsky
Licensed Through Referral Connection, LTD. - Lake Zurich, IL

Bryant, I agree...the focus should be on the consumer and what's in it for them. I'm only successful if I have happy and satisfied clients.

Our dual agency form that must be signed by all parties is actually kind of ominous. It states the following:

"Representing more than one party to a transaction presents a conflict of interest since both clients may rely upon Licensee's advice and the client's respective interests may be adverse to each other. Licensee will undertake this representation only with the written consent of ALL clients in the transaction.

Any agreement between the clients as to a final contract price and other terms is a result of negotiations between the clients acting in their own best interests and on their own behalf. You acknowledge that Licensee has explained the implications of dual representation, including the risks involved, and understand that you have been advised to seek independent advice from your advisors or attorneys before signing any documents in this transaction."

It then goes on to explain exactly what a Licensee can and cannot do for them. You'd think they would all run the other way...but they don't.

So, what's in it for them? Why do clients decide that this is the course of action they want to take? Here are a few reasons that I've been given:

1. They like me, trust me and want me to represent them in whatever capacity. They are confident consumers and have been given factual information about the entire process, from financing, to inspections, disclosures, comps, procedures, etc. It starts with education.

2. I charge a lower commission rate. Both sellers and buyers see this as an opportunity to keep more money in their pockets. I do this for a few reasons. One, because I am not providing full service to either party, so why should they pay for it, and two, because it shows the parties that I am not pushing the deal to earn both sides of the commission or to be greedy.

3. I may be already representing one party in another transaction (the buyer in the sale of their home, for example). It makes all of them feel more confident knowing that I am the one that is taking care of things all the way around. Plus, they simply don't want another Realtor.

The times that I have undertaken dual agency have been positive. As an example, here are testimonials from clients (involved in same transaction) in which I acted as a dual agent:

"Kelly is the most amazing Realtor I have ever had the pleasure of doing business with. She has so much experience and knowledge of the business. I was fortunate to have Kelly on my side through the selling of my home to the purchase of my new home. When the market was weak, she made my home one of the most visited in the area...that is saying a lot about her. She made it so easy for me, I would use her as my Realtor for a lifetime. I really cannot say enough about her. Use Kelly Sibilsky as your won't regret it." -Sean Bishop

"Kelly was great! She was always available to answer our questions and help guide us through the entire home-buying process. You will not find a more honest and competent Realtor!" -Jonathan and Nora Corbitt

Jon and Nora bought Sean's home which I had listed. Nora's dad was the attorney I spoke of earlier.

Sorry this is so long! Thanks for allowing me to take up so much space here and for a great discussion! :)

Aug 16, 2007 12:03 PM
Kaye Thomas
Real Estate West - Manhattan Beach, CA
e-PRO, Manhattan Beach CA

OK.. I'll put in my $.02 here as we can do dual agency in CA... I rarely do dual agency as I don't like the idea  of it... however if both parties want me to represent them this is how I handle it...

 I notify all parties that my office will be representing both parties in the transaction as a dual agent... but that during the offer period  I will represent the seller and an agent from my office will represent the buyer..still dual agency but I will not have contact with the buyer about the offer.... should the offer be accepted I will then represent both parties with the signed permission of all the parties but will not disclose personal things to either party about the other party.

 That said... I would not encourage the buyer in this instance as they are not qualified to buy this property... I would tell them the truth..they are marginal at best and buying this home...even if the squeaked by.. is not in their best interests.  They need to look at something they can afford or they won't own the home very long anyway.  If they don't like my answer and want to find another agent that is OK.. because I would never be comfortable with them trying to buy a home they really couldn't afford..

So I guess the reality is I wouldn't have to worry about dual agency in this case...


Aug 16, 2007 01:33 PM
Patricia Kennedy
RLAH Real Estate - Washington, DC
Home in the Capital

When I first got into the business, it was pretty common to sell your own listing, but with the understanding that you were representing the sellers.  With buyer brokerage, it gets tricky, of course.  I have a trusted colleague whose style and values are very similar to my own.  When I have buyers who wants to write on my listing, I refer them to her and get a referral.  It doesn't come up often, but we do pass people back and forth.

I am not comfortable with "Dual Agency" even in those jurisdictions where it is allowed.  Even in cases where the buyers agree to be unrepresented, I am a little queazy - I make them sign an addendum of my own where they acknowledge that I represent the seller and that my job is to get the seller the highest price and most advantageous terms as I can.  It's sort of tempting to represent neither buyer nor seller, but our own check book balances.

Aug 16, 2007 03:17 PM
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Kelly, Another great comment. I do agree that it is to may sellers advantage if I'm able to have control over both sides of the transaction. Fortunately for me, in Florida, I do that without being a dual agent. Why can't they just get away with that "dual agent" term and call it something else? The double siding is not the issue it's calling a facilitator a dual agent that poses the problem for me. Hey I can dream right? :) Maybe I'm just nit picking on semantics.

Kaye, I met with buyers yesterday(something I rarely do) and went over their mortgage terms that I had faxed to me from their MB. After speaking with the buyers their comfort level was $1,200 per month. The terms they were being offered were closer to $1,700 and in my opinion the numbers were too low. The buyer is currently paying $750 a month in rent. So we are talking more than double in housing expense. My suggestion to them was to start this month and save the difference between their rent and their anticipated mortgage payment. If they did this for 12 months they could be sure they could afford the payment AND they would now have money to put down. I also tried to place them with another MB that could offer them a FHA or rural housing loan which would lower the payment substantially. The buyer just called me this morning to say they have decided to move forward with their original MB at the terms he has quoted them!!!! There's nothing else I can do. I work for the seller in this case and will present the offer. I will use some of the offered co-broke to buy down the interst rate to try and help.(BTW this will be done by a seller contribution with me lowering my fee to the seller to offset the expense). So hopefully it will work out for my represented seller. The unrepresented buyer? Well I hope it works out. This just reinforces why I do NOT work with buyers.

Patricia, I'm with you completely. It just doesn't feel right. That's our clue that it ain't right no matter what the law states.

Aug 17, 2007 04:20 AM
Paula Bean
A Premier Class Realty - Orlando, FL

Wow!  I started reading this post this morning, got busy, then came back to it. 

Interesting responses from all.  I happen to live and work in Orlando, and the agency laws are different in each state. Transaction Brokerage is great, and allows those agents who can actually abide by those laws to do a double sided transaction.  I still prefer NOT to, it just gets messy.

 I would refer the buyer to another agent at another brokerage, don't like working buyers anyway.  Or, Plan B would be to do real estate consulting.  Get paid for what you do, when you do it (upfront) and not have any fiduciary to ANYONE.    That is what every other profession does.  Get your taxes done, they don't charge you continengent on how much they save you, neither does a Doctor charge you based on whether he cures you.

I love the commercial in our area of the guy with Charles Schwab, on the phone with the Doctor (pan to Doctor at ER) who tells him to take his knife and place it between the 3rd and 4th rib cage and make a 3" incision (pan to client with knife in hand sitting at kitchen table)

"Shouldn't YOU be doing this?" 

 Yeah, but he wanted the cheap method.  lol!  If you do real estate consulting, you get paid upfront, non contingent on the house selling.  If the buyer wants to buy, you do the same thing, pay me xyz and I'll handle your paperwork, or go get your own BA.  There can be fiduciary, or not.  I honestly think that most consumers are a little smarter than we give them credit for. 

I haven't found a lot of them telling me what their bottom line is, what the buyer's interest level is, and frankly, I don't really care.  You pay me upfront for a specific job and you can buy or sell the house or not.  It should just be that simple. Just like buying a car with no commissions.  Here is the price,here is what you get, you can get an insurance policy, I will do the paperwork, help you with financing and I will get paid xyz amount of money.  Now if you want to know what may be wrong with the car, get it inspected, but don't rely on me to tell you that, because A) I may miss something, after all, I sell cars, I am NOT an auto mechanic!  B) I'm not going to be unbiased enough to tell you the car is a lemon, I want my money.  So my .02 is to work with a consultant and hire other people for their unbiased expertise. 

 You get a better deal, No high commissions, get paid whether house sells or buyer buys, therefore you can be more unbiased, and there is no legal garbage hanging over anyone's head.

This agency stuff gets harder and harder for agents to understand, I can't imagine how the public gets it!! Enough already!  If I were a seller or buyer, I'd rather get unbiased advice, hire my own inspectors and legal counsel and get a better deal than to worry over who is making how much money in commissions.

If anyone wants more information on this new model of real estate, visit and visit     The commission model is broken, and BB's theoretical situation here is a prime example of that.  In this scenario, the seller may not sell, the buyer may not buy.  The agent doesn't get paid.....WHO BENEFITS FROM THAT???

Paula Bean




Paula Bean


Aug 17, 2007 06:42 AM
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Paula, You know I DO appreciate you reading and commenting BUT please quit selling your services on my posts. I'm going to leave this one but I will have to delete any further solcitations. Why not write a post about your product? I've laready checked it ou and I'm not interested. Thanks
Aug 17, 2007 07:20 AM
William J. Archambault, Jr.
The Real Estate Investment Institute - Houston, TX



I've got egg on my face!

When you said "Bill, Dual agency is illegal in Florida." I had to go back and read the blog twice to find this.

Then I wounder why you were doing it. It took three more readings to discover I'd never read the first paragraph.

I stand by my advice, just not in FL. Personaly I'm not sure they did get it right, but I can understand your postition.

Red fasced in Las Vegas,


Aug 17, 2007 07:50 AM
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time
Bill, That's what happens when you come out of retirement. You get discombobulated:) 
Aug 17, 2007 08:07 AM
Yvette Chisholm
Long & Foster Real Estate, Inc. - Rockville, MD
Associate Broker - Rockville, MD 301-758-9500

Do what is in the best interest of your clients!

Get the buyer the best agent you know (other than you) to represent them!

Transactional brokerage is not what the seller typically understood that they signed up for.  They think they are paying your for representation - so go represent them.

Did I say do what is in the best interest of your clients.  Don't worry about your pocketbook - that will take care of itself when you do what is in the best interest of your clients.

Aug 19, 2007 01:39 AM
Paula Bean
A Premier Class Realty - Orlando, FL

Hi Byant,

Please accept my apologies regarding your comment that thought I was "selling services" on your blog, my viewpoint,  albeit not yours obviously ;-) was that I was trying to educate and inform, as well as give different views and options for those who were unaware of differing methods of selling real estate and wanted more info to check into it.

I guess that's a difference of opinion, based on how you look at it.  You took it as "selling" and I took it as "educating and informing"

 I for one, would love to see different opinions on a wide variety of topics and I thought this was what AR was all about, but it is your blog - your rules, and I'll respect your wishes.

It won't happen again. 


Aug 22, 2007 04:35 AM
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Paula, It's actually not my opinion it's one of the community guidelines for AR. Linking to a service that you are trying to sell is advertising and doesn't belong in some else's post. That why it's better to write a blog about it so you can spread your message to the whole community. I agree, it is useful information, for some. And I would be very interested in reading a post from you about. It would probably stir up a good conversation. Go for it.

Aug 22, 2007 11:03 AM
Paula Bean
A Premier Class Realty - Orlando, FL

Interesting BB!  I've posted several comments to your blog (with no mention of consulting) and others as well....... but am fairly new to the blog world. 

 Where can I find the "AR rules" you spoke about?  It was never my intention to advertise, as that is not what this model is all about, and rofl, for anyone who's EVER done a startup venture, you don't make any money for YEARS... so believe me when I say it was not about the money ;-)

I am in your same area, I responded to a post that I thought was relevant to what you asked with my .02, it was not my intention to "advertise" something I'm not making money off of anyway.  I train agents all over the U.S. and most will tell you I give way more than I ever get, so with that thought in mind, and many other things to do, If I'm going to continue with this AR thing, I guess I need to look at their TOS and not piss anyone off ;-)

 BTW - got an email today from someone in your neck of the woods, wants to sell their house, but as usual, a little upside down in their mtg situation. . . now this was the point I was trying to make earlier when you accused me of 'advertising'. . . sometimes, consulting is the only way to make these deals work. 

I have another house, in my neck of the woods (NW and SW Orange county) where the seller lives in San is here.  We chatted about his house back in JANUARY.  He didn't believe me about how the market was.  Listed with several other agents. No sale.  Tried to rent, no deal.  Now he is calling me back because at least I was honest with him, and he knows that consulting is his only shot at getting out of this mess. 

 THAT  was the reason for my post.  There are many agents who are losing lots of money in this bad market by not offering consumers choices.  Many consumers getting foreclosed on when it's unnecessary.

 Now as to me doing a blog about it on AR?  Probably a good idea, but then there will probably always be those out there (like you)  thinking I'm doing it for the money ;-)  lol......right now I'm waiting for my non-profit paperwork to come in the mail!  For those that really know me, they know it's never been about the money.  I have given more help to agents over the last 30 years than I've ever gotten back, but I love training, helping, giving.  I guess that is why I was a little taken aback by your post that I was "selling my services" lol.....if only I got paid for it, then I'd consider it 'selling".   

As I said - it won't happen again.  It is your blog, and your rules.  I've not found the AR rules to know whether or not I violated one or not, but it doesn't matter as I think it's really a matter of opinion and/or perception.

Not to worry though.....  I will not speak on your blog to this subject again, so it doesn't matter.   I would appreciate knowing where to find the official rules though, if you could give a link - since I'm fairly new at this AR stuff and still not sure it's worth spending my time on, especially when I get chastised for what I thought was sharing and helping.     


Aug 23, 2007 01:51 PM
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Hi Paula, I hope you are doing well today. Here's a link to the AR guidelines.

Please don't take my comments as chastisement. I'm really much to laid back for that. This is a great place and you should certainly hang around and start participating more. You have lot's of experience and are in a good position to help others in their business. OK I'm still waiting on that blog post:)

Aug 24, 2007 12:15 AM
"The Lovely Wife" (Broker Bryantnulls Wife) The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL


This is Broker Bryant's wife (alias TLW) I too hope that you will write a blog post about your business model.

By the way...The "Learn about Real Estate Consulting" link in your profile is busted.


Aug 24, 2007 02:40 AM
Paula Bean
A Premier Class Realty - Orlando, FL

TLW - saw your Happy b-day pics, you don't look a day over 29!  WHAT is your secret??  Share!! 

BB -  Thanks for the link, I'll read through it.  I'm way laid back too, after 30 years doing this it's just too hard not to be.  I did think it woulda been better had you sent me the email direct, not on the blog for God and everyone to see, so I did take it as a chastisement, but hey - life goes on.   

Since I'm so new at the blogging thing, I am really not sure I'm ready for this!  lol!  I did have wicked fun at the Inman Connect conference though and met some really awesome bloggers!  Ardell was someone I've emailed and talked to for YEARS, but never met, then there was Mary Pope Handy who won the blogger contest, never met her in person either, so that was fun.

I can't figure out how anyone has time for this, updating websites, selling real estate and still having a life, but you and TLW seem to have it figured out ;-)

I'll check the broken link, although I'm not the tecno-geek webmaster, I probably typed it in wrong ;-)  Must cut fingernails! argh!  


;-) Paula Bean


Aug 24, 2007 03:41 AM
"The Lovely Wife" (Broker Bryantnulls Wife) The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL

My secret??

Bubble Wrap...Lots and lots of Bubble Wrap :)

And Some Days I Just Skip :)

I am on my way to see what you've written.


Aug 25, 2007 06:22 AM
Paula Bean
A Premier Class Realty - Orlando, FL


I HAVE now saved your bubble wrap thing!!!  WHAT A GREAT stress reliever ;-) I agree with you on skipping some days too - some days the mood is just not right or you need to take some down time. 

Now, where is that great restaurant BB and you went to for your b-day?  I must check it out!  I love Dixie Crossroads, but there is always such a long line to get in, 3 hour drive to get there and no reservations allowed.  Maybe we could meet one day at your restaurant and you can teach me how to blow a bullet hole through bad offers ;-)  THAT was the funniest video I've ever seen,lol!!!!!! I sent it to several people, including one of my sellers who had just received a really low offer on a house he was practically giving away to begin with. 

Didn't help that the other agent was new, spoke no English and his buyer probably thought they were putting in a good offer.  oh well, the buyer came to the sellers house later, apologized, blamed his agent - fired them, then wanted me to start all over again because he really wanted the house. Buyers agent not real happy about that.  Not that I could understand what he was saying when he called, but let's just say the 'tone' didn't sound real happy.  Now we have an arbitration in place, and all of this even after I offered to do the transaction and give the other agent his full co-op!!!

How do you say stupid in several other languages?  Must go look that up.......


Aug 27, 2007 05:52 AM

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