We've said it before, and we'll say it again: it's not always obvious who your real estate agent is working for.
As outlined in this Chicago Tribune article, 'dual agency' is what you call it when one agent represents both the buyer and the seller.
Wait! Isn't that a conflict of interest?
Why, yes, it is. Which is why many states require agents to 'splain themselves if they are trying to persuade a client to accept dual agency. But many agents don't explain it well or at all. Why bother? The fines for violating dual agency are way less than the double commission they collect, one from each side.
The Tribune column clearly outlines the types of pretzel-like relationships that agents can try to get you to agree to. The most important point: know exactly what you are getting into. And who's making money from your home equity.
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3 comments:
As a realtor in Baltimore City for the past 12 years, I take great exception to this article on agency representation. Dual agency is NOT when one agent attempts to represent both sides of a real estate transaction. It is when a buyer agent and a listing agent work for the same broker. There are agency disclosure forms that are presented to new butyers at the very beginning that explains the different forms of agency, including dual agency, that need to be signed by all parties. All realtors are required to attend classes on agency every two years in order to renew their real estate licenses. I
I agree that some agents do not present these forms to new buyers for fear of turning them off from working exclusively with them at the first meeting. However, in my experience, this does not serve anyone well in the long run. This article suggests that the majority of agents choose to not disclose whom they represent which I have not found to be true in my day to day transactions with other realtors.
I also take issue with the statement that most agents show their own listings first, then the listings within their own brokerages before showing other listings. Agents take their direction from the buyer who determines the price, location and type of property they want to buy. Most of this is done in advance, online. Todays's buyer looks online, sends a request to see a specific group of properties and then schedules an appointment. Buyers are too savvy about the market place and have a limited amount of time to look at possible listings. They do not appreciate a realtor who steers them towards a property that does not fit their needs and will quickly move on to one who does!
Sharon Slevin
YWGC Realty
McHenry Row
Sslevin@ywgcrealty.com
As a real estate agent myself, I would be skeptical of any agent being capable of treating the Buyer and Seller equally and fairly when representing both sides of a real estate transaction. Logically, most agents desire to reach the closing table, and would logically favor the Seller. In addition, if the agent is aware that one party is very stubborn and the other party is not, how can he realistically treat both parties equally? I personally believe dual representation of any type should not be allowed, period!
This is truly an eye opener for all property buyers out there. It's best to analyze all the paperwork before signing anything and have at least an idea of how the transactions work in real estate. An honest agent goes a long way too.
Darwin Feldman
Real Estate Investor
http://courseinrealestate.com
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