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8/16/11

Who is the Agent Representing?

Q - When I worked with a real estate agent recently, he mentioned 'agency relationship' but I didn't fully understand it.  What does it mean?

A - 'Agency relationship' is between the principal (you) and the Brokerage (the real estate company).  The real estate agent who represents you is licensed under the Brokerage.  As such, he has the authority to represent you in a real estate transaction when dealing with others.  When you have this kind of 'agency relationship', the agent has fiduciary duties to you such as --
-- Disclosing everything the agent knows about the property or situation that may affect or influence your decision regarding the real estate transaction --
-- Protecting your negotiating position by not disclosing anything that would jepordize it  --
-- Giving you undivided loyalty --
-- Obeying all your legal instructions --
-- Keeping your confidences by not disclosing them to anyone --
-- Excercising all assigned duties with reasonable care and skills --
-- Being accountable for all money and property placed with the Brokerage while acting on your behalf --

This it the primary 'agency relationship'.  There are others as well as working with an agent without any 'agency relationship'.

It is important for you to know what kind of 'agency relationship' you have and what the agent's responsibility is towards you.  The situation is different if you have 'no agency relationship' or if it is a 'dual agency'.

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