is WRONG!!! ....According to the sentinel, there is now a class-action lawsuit relating to the steering of homebuyers to affiliated title, settlement and mortgage companies by large realty brokers. According to the repports, this cost hundreds of dollars for consumers when compared to fees and services offered by nonaffliated competitors.
One of such cases is taking place in Minnesota which was filed on February 21. In this case, one of the state's largest realty firms was charged with breaching its fiduciary duties under state law by steering its buyers to its own title and settlement affiliate whose fees were significantly higher than those available from nonaffliated companies.
This class-action case in Minnesota is one to be watch because it is said to have national signifance for other states whose large real estate brokerage firms have financial relationships with one or more affiliates in the title, settlement and mortgage businesses. It is important to note that when properly structured, these affiliate relationships comply with the federal anti-steering and anti-kickback rules and have survive a number of legal challenges brought on against them.
Part of a real estate brokerage fees sometimes comes from their affiliates. The argument is that even if the affiliates fees or mortgage rates are not the lowest available, the quality and dependdability of the affiliates service more than compensate for any price differences.
According to the definition of broker-client relationship, fiduciary duty means that a real estate broker is bound to put a client's best interest ahead of the broker's and must not profit from the fiduciary relationship unless concent is received from the client. A fiduciary is also responsible in disclosing material facts that might affect the client's best interest. In this pending suit, naturally, the clients and their lawyers feel that their best interest were not put first.
***orlando sentinel - florida***
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