This article below outlines the various agency representations that can occur in any given real estate transaction, viewed from the Sellers perspective. Before we get into the details of these various scenarios lets first look at the basic rights and responsibilities you should be afforded regardless of your role in a real estate transaction as prescribed by the Maryland Real Estate Commission:
- Real estate agents are obligated by law to treat all parties to a real estate transaction honestly and fairly. They must exercise reasonable care and diligence and maintain the confidentiality of clients. They must not discriminate in the offering of properties, they must promptly present each written offer or counteroffer to the property and they must answer questions truthfully.
- Real estate agents must disclose all material facts that they know or should know relating to a property. An agent's duty to maintain confidentiality does not apply to the disclosure of material facts about a property.
- All agreements with real estate brokers and agents should be in writing and should explain the duties and obligations of both the broker and the agent. The agreement should explain how the broker and agent will be paid and any fee sharing agreements with other brokers and agents.
- You have the responsibility to protect your own interests. You should carefully read all agreements to make sure they accurately reflect your understanding. A real estate agent is qualified to advise you on real estate matters only. If you need legal or tax advice it is your responsibility to consult a licensed attorney or accountant.
When you hire a real estate agent to list and sell your home they work for and exclusively represent you as a Seller's Agent, also commonly referred to as a Listing Agent. Under this scenario they can only provide agency representation to you as the Seller and under no scenario can they provide agency representation to a prospective Buyer. A Listing Agent's interests and duty of confidentiality must always remain devoted to the Seller.
A listing agent can assist a Buyer with the purchase of your property so long as they adhere to where their duties lie. Under this scenario the Buyer does not have any agency representation and the Listing agent is merely facilitating the transaction on the Buyer's behalf. This is a common scenario in the Ocean City real estate market and one that has several benefits to it. If this situation arises and your are not comfortable with it you can ask the real estate companies Broker to institute Dual Agency, which you will find explained below.
Agents Representing Buyers from Another Company
In theory, if a cooperating Realtor from another company shows a Buyer your property without a Buyer Agency Agreement in place they are representing the Seller. In reality this is very uncommon and not likely to happen in the Ocean City real estate market. Agents from other companies that are showing your property to prospective Buyers will be representing them as Buyer's Agents through a Buyer Agency Agreement. In this scenario the agent you hired will be representing you and your interests as a Seller's Agent and the agent from the other company will be representing the Buyer and their interests as a Buyer's Agent. This is the most common scenario for a typical real estate transaction in this marketplace.
Agents from Seller Agent's Company
Theoretically all of the agents that work for the same real estate company as the Listing Agent you hired represent you as the Seller. Without any other agreements in place they are operating as Seller's Agents when discussing or meeting with prospective Buyers in regards to your listing. Under this scenario the Seller is represented and the Buyer does not have any representation.
The concept of Dual Agency was introduced several years ago to provide the option for Buyers to have agency representation when two agents from the same real estate company are representing the Buyer and the Seller in a transaction (the situation in the previous section). In order for Dual Agency to be an option the Seller must first authorize it at the time the property is listed. Then the Buyer and Seller must both consent and sign off on moving forward via Dual Agency at the time of contract ratification. Once Dual Agency is in place the listing agent will represent the Seller and their interests while the other agent from the company will represent the Buyer and their interests.
I hope you are not too confused at this point! The good news for you as a Seller is that once you execute a listing agreement with a real estate agent you and your interests are always represented regardless of the scenario. Should you need any additional information pertaining to real estate in Ocean City MD and the surrounding areas feel free to contact me directly anytime at 443-614-9179 or by email below.