CONSUMER INFORMATION
STATEMENT
ON REAL ESTATE RELATIONSHIPS
Real estate
licensees in many jurisdictions are required to disclose how
they intend to work with buyers and sellers in a real estate
transaction.
1.
AS A
SELLER'S
AGENT OR SUBAGENT, I, AS A LICENSEE,
REPRESENT THE SELLER AND ALL MATERIAL INFORMATION SUPPLIED TO ME
BY THE BUYER WILL BE TOLD TO THE SELLER.
2.
AS A
BUYER'S
AGENT, I, AS A LICENSEE, REPRESENT THE
BUYER AND ALL MATERIAL INFORMATION SUPPLIED TO ME BY THE SELLER
WILL BE TOLD TO THE BUYER.
3.
AS A
DISCLOSED
DUAL AGENT, I, AS A LICENSEE, REPRESENT
BOTH PARTIES, HOWEVER, I MAY NOT WITHOUT EXPRESS PERMISSION,
DISCLOSE THAT THE SELLER WILL ACCEPT A PRICE LESS THAN THE
LISTING PRICE OR THAT THE BUYER WILL PAY A PRICE GREATER THAN
THE OFFERED PRICE.
4.
AS A
TRANSACTION BROKER, I, AS A LICENSEE, DO
NOT REPRESENT EITHER THE BUYER OR THE SELLER. ALL INFORMATION I
ACQUIRE FROM ONE PARTY MAY BE TOLD TO THE OTHER PARTY.
Before you
disclose confidential information to a real estate licensee
regarding a real estate transaction, you should understand what
type of business relationship you have with that licensee. There
are four business relationships: (1) seller's agent; (2) buyer's
agent; (3) disclosed dual agent; and (4) transaction broker.
Each or these relationships imposes certain legal duties and
responsibilities on the licensee as well as on the seller or
buyer represented. These four relationships are defined in
greater detail below. Please read carefully before making your
choice
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SELLER'S AGENT
-
A seller's
agent WORKS ONLY FOR THE SELLER and has legal obligations,
called fiduciary duties, to the seller. These include reasonable
care, undivided loyalty, confidentiality and full disclosure.
Seller's agents often work with buyers, but do not represent the
buyers. However, in working with buyers a seller's agent must
act honestly. In dealing with both parties, a seller's agent may
not make any misrepresentations to either party on matters
material to the transaction, such as the buyer's financial
ability to pay, and must disclose defects of a material nature
affecting the physical condition of the property which a
reasonable inspection by the licensee would disclose.
Seller's agents include all persons licensed with the brokerage
firm which has been authorized through a listing agreement to
work as the seller's agent. In addition, other brokerage firms
may accept an offer to work with the listing broker's firm as
the seller's agent. In such cases, those firms and all persons
licensed with such firms, are called "sub-agents." Sellers who
do not desire to have their property marketed through sub-agents
should so inform the seller's agent.
BUYER'S AGENT
-
A buyer's
agent WORKS ONLY FOR THE BUYER. A buyer's agent had fiduciary
duties to the buyer which include reasonable care, undivided
loyalty, confidentiality and full disclosure. However, in
dealing with sellers, a buyer's agent must act honestly. In
dealing with both parties, a buyer's agent may not make any
misrepresentations on matters material to the transaction, such
as the buyer's financial ability to pay, and must disclose
defects of a material nature affecting the physical condition of
the property which a reasonable inspection by the licensee would
disclose.
A buyer wishing to be represented by a buyer's agent is advised
to enter into a separate written buyer agency contract with the
brokerage firm which is to work as their agent.
DISCLOSED DUAL AGENT
-
A disclosed
dual agent WORKS FOR BOTH THE BUYER AND SELLER. To work as a
dual agent, a firm must first obtain the informed written
consent of the buyer and the seller. Therefore, before acting as
a disclosed dual agent, brokerage firms must make written
disclosure to both parties. Disclosed dual agency is most likely
to occur when a licensee with a real estate firm working as a
buyer's agent shows the buyer properties owned by sellers for
whom that firm is also working as a seller's agent or sub-agent.
A real
estate licensee working as a disclosed dual agent must carefully
explain to each party that, in addition to working as their
agent, their firm will also work as the agent for the other
party. They must also explain what effect their working as a
disclosed dual agent will have on the fiduciary duties their
firm owes to the buyer and to the seller. When working as a
disclosed dual agent, a brokerage firm must have the express
permission of a party prior to disclosing confidential
information to the other party. Such information includes the
highest price a buyer can afford to pay and the lowest price a
seller will accept and the parties' motivation to buy or sell.
Remember, a brokerage firm acting as a disclosed dual agent will
not be able to put one party's interests ahead of those of the
other party and cannot advise or counsel either party on how to
gain an advantage at the expense of the other party on the basis
of confidential information obtained from or about the other
party.
If you
decide to enter into an agency relationship with a firm which is
to work as a disclosed dual agent, you are advised to sigh a
written agreement with that firm.
TRANSACTION BROKER
- The
Licensing Laws of many jurisdictions do not require licensees to
work in the capacity of an "agent" when providing brokerage
services. A transaction broker works with a buyer or a seller or
both in the sales transaction without representing anyone. A
TRANSACTION BROKER DOES NOT PROMOTE THE INTERESTS OF ONE PARTY
OVER THOSE OF THE OTHER PARTY TO THE TRANSACTION.
Licensees with such a firm would be required to treat all
parties honestly and to act in a competent manner, but they
would not be required to keep confidential any information. A
transaction broker can locate qualified buyers for a seller or
suitable properties for a buyer. They can then work with both
parties in an effort to arrive at an agreement on the sale or
rental of real estate and perform tasks to facilitate the
closing of a transaction.
A
transaction broker primarily serves as a manager of the
transaction, communicating information between the parties to
assist them in arriving at a mutually acceptable agreement and
in closing the transaction, but cannot advise or counsel either
party on how to gain an advantage at the expense of the other
party. Owners considering working with transaction brokers are
advised to sign a written agreement with that firm which clearly
states what services that firm will perform and how it will be
paid. In addition, any transaction brokerage agreement with a
seller should specifically state whether a notice on the
property to be sold will or will not be circulated in any or all
Multiple Listing System(s) of which that firm is a member.
YOU MAY OBTAIN LEGAL ADVICE
ABOUT THESE BUSINESS RELATIONSHIPS FROM YOUR OWN LAWYER.
THIS STATEMENT IS NOT A CONTRACT AND IS PROVIDED FOR
INFORMATIONAL PURPOSES ONLY.
Should you
choose to list your property, a copy of this information
statement will be provided at the beginning of the listing
agreement before you are asked any information about your
property. That version of this document will contain a signed
acknowledgment area which must be signed and returned with the
listing agreement before we will service you.
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Acknowledge Receipt of a copy of this document:
__________________________________
___________________________________ ___________, 2007
buyer
buyer date
