What Are the Different Types of Agents?
When either a Buyer or a Seller meets with an agent to discuss or go view a property, New York State Law requires that the agent/salesperson discuss with the prospective buyer or seller the New York State Disclosure Form 443and the Law of Agency and request the seller or buyers signature to verify for NYS that the agent/salesperson has in fact discussed the Law of Agency. This is NOT a contract binding either a seller/buyer or an agent to a Fiduciary Duty or committment.
SELLERS AGENT: The agent/salesperson must explain to a seller that AFTER the Contract / Exclusive Right To Sell has been signed, the seller becomes the client of the sellers agent & that sellers agent now owes the seller a FIDUCIARY DUTY in every way exercising:
Confidentiality about the seller & the sellers agent may only disclose what information about the seller that the seller has authorized;
Obedience to the sellers wishes (as long it it doesn't violate the law such as discrimination or withholding acts about material defects in the home), Accountability to the seller relaying every offer made on the property & negotiating the terms & price;
Loyalty must be given to the seller whose interest are exclusively the agents interests;
Care and Due Diligence must be exercised by the agent / salesperson in doing the research as to the information provided to prospective buyers (taxes, square footage, rooms, Certificate of Occupancy, any known easements) and correct information to the best of the agents ability must be provided to the seller when providing guidance from pricing through negotiation, up to the closing.
BUYERS AGENT: The agent/salesperson must explain to a buyer that AFTER the Contract / Exclusive Right To Buy has been signed, the buyer becomes the client of the buyers agent & that buyers agent now owes the buyer a FIDUCIARY DUTY in every way exercising:
Confidentiality about the buyer & only disclosing what information about the buyer that the buyer has authorized;
Obedience to the buyers wishes (as long it it doesn't violate the law such as discrimination)
Accountability to the buyer relaying every offer the the buyer wishes to make on the property & negotiating the terms & price; Loyalty must be given to the buyer whose interest are exclusively the agents interests;
Care and Due Diligence must be exercised by the agent / salesperson in doing the research as to the information provided by sellers (taxes, square footage, rooms, Certificate of Occupancy, any known easements ) and correct information to the best of the agents ability must be provided to the buyer when providing guidance from pricing through negotiation, up to the closing. Further as a buyers agent, that agent will leave no stone unturned in searching for a property for the buyer such as Foreclosures and For Sale By Owner homes in additiona to the standard Multiple Listing Service.
DUAL AGENCY: *** (NYS Legal Memorandum 112-Beware of Dual Agency) If a buyer approaches a sellers agent directly, that agent must explain to both parties that they must becomes completely impartial and absolutely quiet about both parties and to both parties offering no recommendations or guidance in preparing an offer nor offer any input to the seller on consideration of the offer. BOTH THE BUYER & THE SELLER ARE NO LONGER REPRESENTED BY THEIR OWN AGENT!!! The agent handling both sides must become a transactional agent merely handling the paperwork and acting as a go between for the parties exchanging information. As many buyers and sellers still think the agent is helping them, this must be explained in detail to the parties and both parties must agree in writing. If one party does not approve, then the agent can ask that his/her office manager Designate an Agent to act on behalf of the BUYER and the agent continues to represent the seller exclusively.
**** A violation of Dual Agency by an agent is a violation of the (as of January 1, 2007) NYS Real Estate Agents Code of Ethics & Standards and could cost the agent a fine or license suspension!!!
DUAL AGENCY WITH DESIGNATED AGENT *** (new as of January 1, 2007) If the sellers agent & the buyers agent ,though two (2) separate agents providing FIDUCIARY DUTIES to their respective clients, both work for the same company, even if different offices, since both agents licenses are held by one (1) company, NYS considers the relationship as Dual Agency but each agent is the Designated Agent of their respective clients.
BROKERS AGENT *** (new as of January 1, 2007) In this type of agency, the agent though working with a buyer, is actually a representative of the seller (like Dual Agency) with NO FIDUCIARY DUTY TO THE BUYER, and basically replaces the previous category of Subagency. The difference from Brokers Agent and Subagent is that if a buyer now sues the agent they working with for any reason, the seller is no longer liable for the misinformation or misdeeds of that agent. The language in the law is vague though and will need to be clarified by the New York State Legislature.
*****New York Times Article December 31, 2006-- Spelling out Brokers' and Agents' Duties . Beginning tomorrow, New York real estate brokers will have to provide clients with new forms to sign that describe the relationship between the broker and the client.... read more
***New York State Association of Realtors (NYSAR) article regarding the new Agency Disclosure form 443 effective January 1, 2007 ... read more