Real estate transactions are among the
largest financial investments that most people make. A trained
professional can help make the experience pleasant and rewarding.
In fact, with the assistance of a real estate professional,
property sells faster and for a higher price.
The following information is taken from the Working With a REALTOR® brochure, a standard tool used by all REALTORS® in BC that explains agency relationships and describes which personal information is collected, as well as how it's used and distributed. Click here for a PDF version.
Your
Responsibilities as a Buyer/Tenant or a Seller/Landlord
You should:
- Carefully
read all documents and understand what you are signing.
- If you need
special or expert advice, seek other professionals such
as lawyers, notaries, accountants, home inspectors, contractors,
engineers and surveyors
Definitions
The Brokerage is the real estate company
under which the individual is licensed.
The Licensee is the managing broker, associate
broker and/or representative of a Brokerage.
REALTOR® is often used
interchangeably with licensee, real
estate agent or representative and, in BC, is licensed
under the Real Estate Services Act. A Licensee can use the term REALTOR® if he/she belongs to a local real estate board or association that enforces a strict Code
of Ethics.
The Boards are the real estate boards and
associations in whose jurisdiction the property is located
and/or of which the Brokerage or REALTOR® is a member.
They are boards and associations which assist REALTORS® to
market, sell or lease real estate. The Boards also provide
ongoing training for their members, enforce ethical standards
and help resolve disputes between members and the public.
The Multiple Listing Service® is a computerized
database of real estate listings and sales. It is operated
by the Boards in conjunction with other real estate boards
and The Canadian Real Estate Association.
Personal Information means any personal information about you, including your name, address, phone number, financial information and may include information about your property (such as listing and selling price, lease rate, listing term, etc.).
The buyer/tenant is often referred to as the purchaser.
The seller/landlord is often referred to as the vendor.
The principal is someone who has engaged
a Brokerage to act for and on his or her behalf either to buy, sell or lease real estate.
The landlord is often referred to as the lessor.
The tenant is often referred to as the lessee.
A full glossary of real-estate related terms is available here.
The Agency Relationship
REALTORS® work within a legal relationship called agency.
The agency relationship exists between you, the principal,
and your brokerage, the company under which the individual
representing you is licensed. The essence of the agency relationship
is that the brokerage has the authority to represent the principal
in dealings with others.
Brokerages and their licensees are legally obligated to protect
and promote the interests of their principals as they would
their own. Specifically, the brokerage has the following duties.
- Undivided loyalty. The
brokerage must protect the principal's negotiating position
at all times, and disclose all known facts which may affect
or influence the principal's decision.
- To obey all lawful instructions of
the principal.
- An obligation to keep the confidences of
the principal.
- To exercise reasonable care and
skill in performing all assigned duties.
- To account for all money and property placed
in a brokerage's hands while acting for the principal.
You can expect competent service from your brokerage, knowing
that the company is bound by ethics and the law to be honest
and thorough in representing a property listed for sale or lease. Both
buyer/tenant and seller/landlord can be represented by their own brokerages
in a single transaction.
Dual Agency
Dual agency occurs when a brokerage is representing both buyer/tenant
and seller/landlord in the same transaction. Since the brokerage has
promised a duty of confidentiality, loyalty and full disclosure
to both parties simultaneously, it is necessary to limit these
duties in this situation, if both parties consent.
If you find yourself involved in a dual agency relationship,
before making or receiving an offer, both you and the other
party will be asked to consent, in writing, to this new limited
agency relationship.
This relationship involves the following limitations:
- The brokerage will deal with the buyer/tenant
and the seller/landlord impartially;
- The brokerage will have a duty
of disclosure to both the buyer/tenant and the seller/landlord except that:
- the brokerage will not disclose that
the buyer/tenant is willing to pay a price or agree to terms other
than those contained in the offer, or that the seller/landlord is
willing to accept a price or terms other than those contained
in the listing;
- the brokerage will not disclose the
motivation of the buyer/tenant to buy or or lease or the seller/landlord to sell or lease unless
authorized by the buyer/tenant or the seller/landlord;
- the brokerage will not disclose personal
information, not otherwise necessarily disclosed in the transaction documentation, about the buyer/tenant or seller/landlord unless
authorized in writing.
- The brokerage will disclose to the buyer/tenant
defects about the physical condition of the property known
to the brokerage.
When There is No Agency Relationship
You may also choose to use the services of a REALTOR® without
having any kind of agency relationship. This might occur, for
example, when you are being shown a property by the seller's/landlord's
agent.
The REALTOR® you choose to work with in this manner has a legal and ethical
duty to provide you with accurate, honest answers to your questions and may
provide all these services:
- Explain real estate terms and practices
- Provide and explain forms used
- Assist you in screening and viewing properties
- Inform you of lenders and their policies
- Identify and estimate costs involved in
a transaction
- Assist you in establishing your range
of affordability
- Prepare offers or counter-offers at your
direction
- Present all offers promptly
A REALTOR® who is not your agent cannot:
- Recommend or suggest a price
- Inform you of his/her principal's top/bottom
line
- Disclose any confidential information
about his/her principal unless otherwise authorized
You should not provide a REALTOR® who is not your agent
with any information that you would not provide directly to
his or her principal.
Members of the public are aware that, in most cases, properties
offered for sale by members of the real estate profession have
a commission or fee that the seller/landlord has agreed to pay to the
listing brokerage.
The listing brokerage traditionally shares this commission/fee
with the cooperating brokerage. Commission and fee may vary.
