Many Potential Real Estate Agents

Disclaimer: This article is not intended to be legal advice. Legal advice depends on each and every person’s particular circumstance. If you have a related issue, you should consult with your lawyer who practices law in your state regarding your particular circumstance. This article is for informational purposes only.

Whoosh… SLAM!

He marched into my office after he slammed the door shut behind him.

His face was grim and his fists were balled up. He plopped down in the chair across from my desk, and he took several deep breaths and exhaled slowly. After he calmed down, he looked at me and flashed an apologetic smile.

After a few seconds, he then demanded: “Just who did he represent?! I thought he was representing ME!

I smiled at him cautiously. Then, I carefully asked him: “Who? Who did you think was representing you?” “The Realtor!” he bellowed. “I was the buyer-and he called himself the buyer’s agent-but he was not representing me! He was supposed to be representing me!”

“What made you believe that he was representing you?” I asked.

“He’s a real estate agent. He was the agent for the buyer-and I was the buyer. That means he was representing me, right? He had to protect my interests over everyone else’s right?”

“It’s… not… that…. simple….” I replied slowly, attempting not to anger him further. “Let me see your contract with your real estate agent and all the disclosures your real estate gave to you.”

After reviewing his paperwork, I replied “No, your real estate agent was a transactional broker-he did not owe you a duty of loyalty. In other words, he did not have to put your interests ahead of his own.”

“You’ve got to be kidding!”

“No. I’m not….”

WHAT IS THE PROBLEM?

Many potential buyers and sellers work with real estate agents. These buyers and sellers hire realtors with the thought that these professionals “represent” them. These buyers and sellers believe that these professionals must protect their best interests over everyone else’s in the transaction.

However, this is simply not the law in states like Florida. In Florida, Florida Statutes §475.278 clearly provides that the presumption is that a realtor acts as a “transaction broker”-and does not owe a fiduciary duty to its client.

Just what is a fiduciary duty?

A fiduciary duty is the highest standard of care at either equity or law. A fiduciary (abbreviationfid) is expected to be extremely loyal to the person to whom he owes the duty (the “principal”): he must not put his personal interests before the duty, and must not profit from his position as a fiduciary, unless the principal consents. Wikipedia, http://en.wikipedia.org/wiki/Fiduciary

Therefore, generally, since a realtor is not a fiduciary in states like Florida, a Florida realtor (1) is not legally required to be loyal to its customers, (2) can legally put its own interests ahead of its customers, and (3) can legally profit at the expense of its customers.

As we witnessed in the above scenario, since most of the public believes otherwise, a real property transaction can go unexpectedly wrong at the expense of the buyer and/or seller.

WHAT IS THE SOLUTION?

Don’t walk into the transaction confused or misinformed! Often, buyers and sellers believe that have something that they don’t actually have. This mistake in expectation can cause substantial problems in real property transactions. Therefore, know where you stand before deciding on a particular realtor:

  1. Before working with a real estate agent, understand what the law in your jurisdiction provides about the type of relationship you will enjoy with your real estate agent. In states like Florida, unless you require your realtor to agree otherwise in writing, your real estate may only represent the transaction–and not your best interests.
  2. Ask your realtor what the applicable state law provides about the potential relationship with him or her. If you don’t understand the real estate agent’s response, consider posing a few hypothetical questions to the real estate agent to attempt to gain an understanding.
  3. Decide what type of relationship you want to have with the realtor. In many instances, you may want your real estate agent to be loyal to you. However, sometimes, you may not. Your particular circumstances will dictate whether you may want a duty of loyalty from your real estate agent or not.
  4. Be prepared to negotiate exactly the type of relationship you want with the real estate agent. However, be forewarned: if you want a stronger relationship with your real estate agent, he or she may ask for more compensation. Therefore, be prepared to negotiate all of the terms of your relationship!
  5. Make sure that your agreement with your real estate agent is in writing. If you negotiate a specific relationship, it is probably a good idea to put it in writing.
  6. If you are unsure about your relationship and/or contract with your real estate agent, consider consulting with an attorney in your particular jurisdiction regarding the matter. Many attorneys in my jurisdiction charge less than $250 (the cost of a consultation) to review standard real estate contracts and to discuss a party’s rights in such transaction.
  7. Just because a realtor (1) is not legally required to be loyal to its customers, (2) can legally put its own interests ahead of its customers, and (3) can legally profit at the expense of its customers–doesn’t mean that he or she will! I have worked with many real estate professionals who have put their clients interests ahead of their own interests. Therefore, work hard to find a professional that you can trust one of largest assets with: your home!

Real Estate Agents Throughout the Country and Real Estate Community

Consumers are sounding off about their past experiences with their real estate agents throughout the country and in the Las Vegas real estate community. It would seem that the general public is not happy with the performance or guidance given by their Realtors and most compare them to used car salesman. We at MyGoRealty.Net want to offer you some of our opinions to this problem affecting consumers from Las Vegas to New York.

One of the primary complaints for consumers wishing to purchase Las Vegas Real Estate was a conflict of interest if their real estate agent whether in Las Vegas or elsewhere was representing them as a buyers agent but being paid by the seller. The complaint stems from the understanding by the buyer that if the Realtor was being paid by the seller, what reason did the real estate agents have to protect their interest as a buyer.

In Las Vegas all real estate agents are required to disclose whom they represent, this agency disclosure is there for the purpose of allowing the buyer, seller and prospective agents to understand whom is representing whom.

To take this one step further, if you as a consumer are leary about your Las Vegas Real Estate agent receiving compensation from the seller, you can elect to pay these fees yourself. This might serve you in two ways when buying a home in Las Vegas. First this would allow you to negotiate this cost from the real estate listing price of this Las Vegas home. The second benefit would be securing piece of mind knowing that this Las Vegas Realtor that you are paying is going to represent your best interest. This also gives you a bargaining chip with your Realtor. The real estate agent will understand since you are paying the fees, they must know that if you are not satisfied with their level of service or knowledge, you will fire them and find another Realtor to pay this fee to, not to mention the extra legal ramifications this real estate agent will be accepting with you paying the fees.

Another common complaint about real estate agents is that they don’t possess adequate knowledge about all factors related to determine a homes value. One consumer even stated that Realtors are not the brightest bulbs. Because of these perceptions, consumer’s dont feel real estate agents earn their commissions.
I must agree with this statement as most agents in Las Vegas have very little knowledge much less understand there are more factors to determine a homes value than a comparative market analysis. Las Vegas as within any other city, you must understand that a homes value requires you to consider, job growth, economics, political decisions, population statistics, income projections and building cost to just name a few. We offer our clients a free instant real estate value checker called My Neighborhood Values which calculates some of these factors transformed into mathematical figures into its value algorithm.

With the past explosion of the Las Vegas Real Estate market more and more people are acquiring their real estate license. The problem we see with this is most of these individuals don’t understand that the real estate profession is a full time job. They don’t familiarize themselves or keep updated on an every changing market such as Las Vegas. Most of these agents get into the business for the money and forget that even though this industry pays well, it requires a lot of dedication, knowledge to remain successful and the ability to put your Las Vegas clients before yourself.

As a consumer the most important decision you will make when purchasing a home is selecting a real estate agent. Always make sure this agent is familiar with the areas you are considering. Make sure your real estate agents knowledge goes beyond that of typical agents. Be aware that no matter whom you select to represent you in Las Vegas, no one can better advise or prepare you for the issues that may lay ahead, than yourself.

Real Estate Agent When Buying A Home

Deciding whether or not to use a real estate agent when you buy or sell your next home is a question that you might have asked yourself in the past. If you are not sure if it would be beneficial to use a Real Estate Agent, maybe this article can help.

The 2011 profile of homebuyers and sellers created and distributed by the National Association of Realtors shows that For Sale By Owners (FSBO’s) accounted for only 10% of home sales. Also the average FSBO listing sold for $150,000 while the average real estate agent assisted home sold for $215,000. While many people think that they can save time and money by selling the home on their own, this is often not the case. They also usually don’t always understand the trials that come along with selling their home FSBO. The Profile of Homebuyers and Sellers show the hardest tasks for a FSBO are:

• Understanding the housing market and listing their home at the right price.
• Understanding the paperwork involved and correctly filling everything out.
• Having enough time to devote to all aspects of the sale. This would be marketing the home, showing the home, responding to phone calls and emails about the home, etc.
• Determining whether or not they should spend extra money to prepare or fix up the home.
• Selling the home within a certain time frame.

Purchasing or selling a home is typically the largest investment most people will make in their lives. Whether you’re buying a new home or selling your existing home, a real estate agent can help protect your interests and potentially save you a substantial amount of money. We have compiled a list of benefits for both the homebuyer and seller.

Reasons To Use A Real Estate Agent When Buying A Home

1. A home buyer is usually not required to pay the real estate agent. When a real estate agent represents a home buyer on a purchase of a home, the commission earned by that agent is paid for by the seller of the home. The commission is taken out of the sales price.

2. Real estate agents have access to the Multiple Listing Service (MLS). The MLS is a serviced provide to real estate agent that gives them the most up today information on homes that are for sale in your area.
This service is not available to the general public. With the MLS an agent can find out information about the home like, taxes, how long it has been listed, price changes, special features on the home etc.

3. Agents have knowledge about the area. A real estate agent should be able to tell you about the neighborhood, schools, activities, recreational areas, etc. that are available in the areas that you are looking to purchase.

4. Agents know how to negotiate with the seller on your behalf. Negotiating the price of a home can often get very difficult. In today’s market it is not uncommon to ask for closing costs to be paid, repairs to be completed, home warranties, or inspections. Often real estate agents are able to negotiate items in the home like washers/dryers, refrigerators, or furniture into the sale of the property. Your real estate agents job is to make sure you get the best deal.

5. Agents keep the deal going. Once your offer has been accepted you will have a lot of tasks that need to be completed in a short amount of time. Your agent can help you keep track and orchestrate all the tasks required in the buying process.

Reasons To Use A Real Estate Agent When Selling A Home

1. A real estate agent is worth the commission. Once you actually consider all the things your agent will do for you from the time they list the home to the time it sells, the commission paid to that agent is usually money well spent. Often times an agent will be able to help you get your home sold much faster and for more money than you could have on your own.

2. Agents understand the current housing market. Choose an agent that lives in your area. This agent will understand the neighborhood, home values, benefits of the area, and the local competition.

3. Agents know how to sell your home. This is their job, and just like any other job if they don’t do a good job they get fired. A real estate agent is a professional and should know what they are doing. It is often a good idea to get an agents track record prior to letting them sell your home. Selling any home takes experience, dedication and knowledge in this market. Their job is to attract buyers and sell the home.

4. Agents know what will make houses sell. Your agent will be able to give you advice on what could be done to the home to get it sold quicker. Anything from staging the home to making minor repairs or upgrades.

5. Agents will put your home on the MLS. A real estate agent has access to the Multiple Listing Service (MLS). This tool is only available to real estate agents and allows them to get your home in front of thousands of other agents and buyers.

6. Agents know how to market your home. Your agent will know what to do to market your home for sale, whether that is an open house, internet exposure, flyers, caravans, etc.

7. Agents represent you to the end. Your agent will represent you from the time the home is listed to the time is closes escrow. An agent’s job is to make sure your interests are protected in the sale of the home and every thing negotiated in the contract is fulfilled. If a problem arises at or after closing your agent is there to help resolve any issues.