Barbara's Blog - Who Does The Broker Represent? Part One

Whether buying or selling a house, using a broker or an agent can help expedite and ease the process. Here’s a breakdown of the different types of agents.

Seller's agent – Represents the seller. This doesn’t mean that he or she can’t answer questions from the buyer or the buyer’s agent. Legally, a seller’s agent is obligated to be fair and honest with all parties involved in a real estate transaction. But keep in mind that the seller’s agent will share any information you give them with the seller so be careful what you say when speaking with them.

Buyer's agent – Works exclusively for the buyer. There is typically a written contract between the buyer and agent stating that the buyer cannot work with other agents. Also in the contract is a confidentiality clause stating that the agent will not share any of the buyer’s information with the seller’s agent without prior authorization.

Dual agents – (also called "dual representation"). Works for both the buyer and seller. In this situation, both the buyer and seller have to sign agreements giving the agent consent to represent both sides. You should know that with dual representation the agent is limited in being exclusive to each party, not saying you would not be fully represented but the line between buyer/agent confidentiality is grayed.

Designated representation – A variation of the dual agent concept. There’s one agency that represents both the buyer and seller with the difference being the agency will assign one agent to the buyer and another agent to the seller.  Again you must know that in this situation neither agent acts exclusively in the interest of the seller or the buyer and will not be able to give either their undivided loyalty.

For example, let’s say you are able to afford $250,000 for a condo, but find one for $200,000 you tell your agent – in confidence – that you really want this condo and can pay more for it but want to negotiate the price first. Because you agent has no obligation to be loyal to you, they can tell the selling agent (and let’s not forget, co-worker) how much you can afford making a negotiation insignificant.