Agency

NOTE: Would you like an updated pamphlet on agency? Send me an email and I’ll drop one in the mail or an email.  Thank you for visiting our Winchester Virginia Real Estate Online Resource Center at MarketPlace Realty.

Until recently, real estate agents always represented the seller, not the buyer in real estate transactions. Even that real estate agent who drove you from house to house looking at properties was not working on your behalf. By law, the agent was always required to get the highest price and best terms possible – FOR THE SELLER!

Market developments have caused all this to change, as more and more real estate agents and companies will only represent the buyer in the real estate transaction. You can now have an agent specifically committed to representing you, from the initial selection of properties to the contract negotiations to the settlement table… AND WE PUT IT IN WRITING, as required under the new 2012 Virginia regulations. As a matter of fact, we now must give you that written assurance of representation before we can show you properties.

Consumer advocacy groups have endorsed buyer representation, and licensing laws in virtually every state have now been reformed to enable and encourage representation for the buyer.

Whether you’re a first-time buyer or an experienced buyer, it is good to know that your real estate agent has your best interests in mind as you select a home.

Put Roger Lamborne, an Experienced Buyer Representative in the Shenandoah Valley, to work for you.

Property Search
As your buyer representatives, we will appraise your particular criteria for a house and neighborhood, then search for properties that fit those specifications. We will set appointments for showings and monitor the market as new listings become available.

Market Data
Market value is determined by many factors, including the availability of similar properties at competitive prices, location, condition, and most of all the price that a knowledgeable buyer is willing to pay. We will provide market data to help you establish an offering price.

Purchase Offer
There may be other considerations besides price that are equally important in structuring a purchase offer. The terms and conditions of the offer, amount of deposit and possession date are likely to be factors when an offer is made. We will help in your preparation of a purchase offer.

Negotiating
When a purchase offer is made, the sellers may be concerned with certain aspects, including the ability of the purchasers to fulfill their agreement, the terms and conditions of the offer, the breakdown of closing costs between buyer and seller and even the motivations and lifestyle of the prospective new owners! We will help structure a negotiating strategy that will create the desired result, a new home.

Handling Details
A lot has to happen between signing the purchase offer and moving into a new house. We will attend to the details and keep you in touch with the transaction every step of the way.

Sellers list their homes with real estate agents to assure professional representation throughout the selling process. As a buyer, you deserve the same kind of service…

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From the Virginia Association of REALTORS®

Brokerage Relationships

Understanding the Options: What you should know about a REALTOR’S® role

Client or customer? When dealing with a REALTOR® in a real estate transaction, you are usually either a client or a customer of the REALTOR®. A client is someone who has formed a brokerage relationship with a REALTOR®, usually by signing a contract, and the REALTOR® is their agent. Parties who do not have a brokerage relationship with the REALTOR® are customers.

When acting as a standard agent, a REALTOR® has certain duties and obligations. The basic duties are defined in Virginia law (see especially Section 54.1, Chapter 21, Article 3), and additional duties can be created by a brokerage agreement with a client in writing. REALTORS® are also governed by a strict Code of Ethics.

A REALTOR® you choose as your agent will fully represent your best interests. An agent owes first allegiance to his or her client. There are some limits when an agent has two clients in the same transaction (see overlapping brokerage relationships). Brokerage relationships with an individual REALTOR® also bind the other employees of the same real estate company. Among the standard duties a REALTOR® owes a client are:

• Perform the terms of the brokerage agreement.
• Promote the client’s best interest by seeking a transaction acceptable to the client.
• Provide financial accounting.
• Disclose known material facts about the property or the transaction.
• Exercise ordinary care.
• Maintain client confidentiality, unless the information is required by law to be disclosed.

An agent does have duties to a customer, as well. Standard agents must:

• Treat all parties honestly and do not knowingly give false information.
• Inform all customers and potential customers of the nature of their brokerage relationships, if any.
• Disclose material adverse facts pertaining to the physical condition of the property which the REALTOR® is actually aware.
• Comply with the law, including the Fair Housing Act.
• There are limits on what an agent must tell a customer. Customers may wish to look to other sources for information important to their decisions.

Standard Seller Representation

If you are selling property or offering it for lease, and sign a listing agreement with a REALTOR®, then the REALTOR® and his or her brokerage firm become your agent and you are their client. Salespersons for other companies who are cooperating with the listing company and showing it to prospective buyers or tenants may also be your agents. Their goal is to seek a transaction on terms acceptable to you, and owe you standard agent duties outlined above.

If you are a prospective buyer or tenant who is dealing with a REALTOR® who represents the seller or landlord, remember that you are a customer of that REALTOR® and not a client.

A seller’s representative can still provide valuable services to customers – showing the property, preparing and presenting any offers and counteroffers, comparing financial alternatives, and disclosing known adverse material facts about the condition of the property. All agents in a transaction must be truthful with all parties, but the seller representative’s highest duty is to the client.

Standard Buyer Representation

Prospective buyers and tenants have realized in recent years that they may want to have a REALTOR® of their own representing them in a transaction.  (Ask your agent for a copy of the VAR handout for buyers) They do this by forming their own brokerage relationship, usually by written agreement with a REALTOR® who becomes their agent and owes them the duties of a standard agent. A representative for the prospective buyer or tenant can freely advise the buyer-client about all aspects of the property.

A seller dealing with a buyer’s agent should remember that in this relationship, the seller is the customer and the REALTOR® is working for the buyer. In many cases, the listing agent will share the commission with the buyer’s representative, but that doesn’t diminish the buyer representative’s obligation to the buyer.

Overlapping Brokerage Relationships

The increasing popularity of buyer representation has increased the number of transactions where a REALTOR® might have overlapping brokerage relationships.

This happens when a buyer or tenant client of a real estate company wants to buy or rent one of that company’s listings. Even if different REALTORS® are working with different clients, their dual loyalties are created through their company, which has legal and contractual obligations to both clients.

In dealing with these situations, there are two ways for the transaction to proceed:

Option 1: Standard Dual Representation

Virginia law allows a real estate firm or salesperson to represent both sides of a real estate transaction as long as all the parties give consent. However, MarketPlace REALTY as a standard policy does not allow its agents to perform as dual agents…Because the company has a legal obligation to represent both parties, and may know confidential information about one party of value to the other party, there are limits to what the company or salesperson may do in dual representation cases.

The company or salesperson must not disclose information that is confidential or would create a negotiating advantage for either client, such as whether the seller will take a lower price, or the buyer will pay a higher price. Generally, information about the motivations of the parties must also be kept confidential. In effect, dual representation limits the REALTOR® to a neutral role.

Option 2: Designated/Dual Representation

If all parties agree, a real estate company can designate one of its REALTORS® to represent the seller or landlord and a second REALTOR® to represent the buyer or tenant in the same transaction. A supervising broker in the company will oversee the transaction, and that person will still be the representative of each party. However, each of the designated representatives will be able to offer full service to his or her assigned client.

The supervising broker will need to maintain the confidentiality of any client information which could be of value in negotiations. The two designated representatives must not share confidential information with each other. But when working with their individual clients, they are free to gather important information from outside sources, free to help with negotiations, and will be thinking first of their client’s needs and wishes.

You are not required to agree to either of these dual representation situations. If you refuse the dual agency relationship or designated representation, the real estate licensee must choose which party to represent, and the other party is free to arrange other representation for that transaction.

Reprinted in its entirety with permission of The Virginia Association of REALTORS® on the Winchester Virginia Real Estate Resource Center.

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