What is an Agency Relationship, and Why Does it Matter?

When you are buying or selling a home, it is important for you to select an agent who is experienced, knowledgable, professional and will help you through every step of the process.  After selecting an agent, you'll work with this person to identify the property that is right for you, help you determine the price and terms of the bid that are appropriate and help you negotiate the contract.  Once ratified (the deal has been accepted by all parties), your agent will lead you through the escrow period.  Escrow refers to the time frame between the acceptance of the offer to the closing of the deal.  In other words, during this time, the buyer has the property inspected, works with their lender to procure their loan and the seller makes sure that they have disclosed everything about the property that might affect its value or the buyers enjoyment of the property.

Most buyers and sellers will select their own agents to represent them.  Some buyers will ask the listing agent to represent them.  Sometimes the buyer and seller will have different people representing them, but both parties work for the same real estate broker.  What are the roles and responsibilities of your buyers agent? versus the sellers (listing) agent?

To clarify all of this and be sure that all parties know the roles and responsibilities of all in the transaction, a Disclosure Regarding real Estate Agency Relationship is signed by all parties before homes are listed (Seller with their listing agent), before an offer is written (Buyer with their buyers agent) and before an offer is presented (buyers agent with the Seller).  Interestingly enough, the agent representing the buyer or the seller has the same duties to the party they are working with.  When I take a new listing, Zephyr (and Stacey and I) create a seller/agency relationship that creates a fiduciary duty of utmost care, inegrity, honesty and loyalty in dealings with the Seller.  When representing a buyer, Zephyr (and me) create a buyer/agency relationship whereby Zephyr has a fiduciary obligation to you, the buyer, with a duty to provide the utmost care, integrity, honesty and loyalty.  In some cases, Zephyr will have Dual Agency.  This means that Zephyr will represent both the buyer and seller in a transaction.  Even though we prefer to represent one party in a transaction (Stacey and me), there are times when the agent on the other side will also be another Zephyr agent.  This will occur if you wish to purchase a property which has been listed by another Zephyr agent.  And, no surprise, Zephyr will have the same obligations of care, fairness and honesty to the seller as well a the buyer, but may not disclose to the buyer that the seller will accept a price less than the listing price or to the seller that a buyer will pay a price greater than the price offered.

We see very few cases where we are willing to represent both parties in a real estate transaction.  We believe it allows us to look out for your best interests by only representing one party--either the buyer or the seller.  We are happy to discuss this with you--please give us a call.

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