Agency And Agency Relationships Vocabulary

In real estate, agency is used to determine the legal responsibilities your real estate professional owes to each and every one who is part of the transaction. The list below are just some of the useful terms used in agency and agency relationship. You will be able to find these terms in most cases.
  • Seller's Representative, also known as a seller's agent or listing agent, is hired by the seller to represent the seller. Any duty that is fiduciary is owed to the seller. This person's job is to get the best in terms of price and terms. The agency relationship is usually created by a signed listing contract.
  • Buyer's Representative, also known as a buyer's agent, is hired by buyers to work in the best interest of the buyer throughout the transaction. Regarding the terms of payment for the agent, the buyer can pay the agent a fixed negotiated fee, paid by the seller, or a commission split between the buyer's agent and seller's agent.
  • Subagent has the same fiduciary duties to the agent's customer. A subagent typically arises when a there is a sales associate from a different brokerage, who is not the buyer's agent, shows the property to the buyer. The subagent and buyer work together to show the property. However, the subagent owes fiduciary duties to the listing broker and the seller.
  • Disclosed Dual Agent represents the side of both the buyer and the seller in a real estate transaction. Dual agents have limited fiduciary duties to both the buyer and the seller due to the potential conflict that may arise in such relationship. When having a Disclosed Dual Agent, both the buyer and seller parties should provide written consent.
  • Designated Agents, also known as appointed agents, are picked by a managing broker to act as an agent to either the seller or the buyer. Doing so will avoid problems arising from dual-agency relationships for licensees at the brokerage. A full representation is given to the client by the agent. This includes all fiduciary duties.
  • Transaction Broker, also known as a facilitator, is only allowed in states where nonagency relationships are allowed. The relationship varies from state to state. Usually, the duties that arise from this is less than the entire fiduciary duties of an agency relationship.
These are the usual terms that you might encounter. It's best that you have an idea on what they mean so to have advantage on your side.

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Paolo

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Paolo was fascinated by real estate, buildings and houses ever since he was young. He also enjoys reading books, watching TV shows on Netflix, and studying Japanese.