|
WHAT DOES A
REALTOR DO?
It bears
repeating that a home is most people’s largest single
investment. With that in mind, the primary purpose of a Realtor
is to provide you with PEACE-OF-MIND in the selling of your
home. The most important quality you are looking for in a real
estate agent is TRUST. You want to be able to TRUST your agent
to work hard on your behalf, to be very knowledgeable about the
market, to listen carefully to your needs, to provide you with
information and creative alternatives, and to always keep their
promises. You can rest assured we take this commitment
seriously! The following is our pledge to you:
Be a good listener and
understand your real estate needs
Explain and be able to answer
questions to your satisfaction while reviewing the forms
that will need to be signed as they review with you the
listing agreement contract.
Represent you in all
negotiations
Problem-solve and coordinate
all parties to the transaction as you work toward a
successful close in a timely manner.
HOW DOES THE
REALTOR GET PAID
As a consumer in
the real estate market, you will benefit from the services of an
experienced Realtor throughout the selling process, and it’s
important that you understand how real estate agents are paid.
Basically, you, as the seller, will pay a commission to the
listing broker, not the specific agent, based on a
percentage of the selling price. The listing broker then splits
this commission with both the buyer’s broker and their
respective agents.
Did You Know……
Sales
Associates are self-employed, and receive no salary or
benefits. They get no paid vacation time, insurance,
company cars or expense accounts from the firm they work
with.
Sales
associates are only paid for results-----if and when
they successfully complete a property transaction.
As
independent contractors, sales associates have ongoing
out-of-pocket expenses similar to those of any small
business such as: advertising and marketing of their
services, automobile expenses, MLS access fees, postage
and courier fees, national, state and local Realtor
Association dues, long distance, cellular and/or paging
services, Internet fees, business cards and other office
supplies, business insurance and self-employment tax,
continuing education course fees, and, many pay monthly
office rent.
AGENCY
RELATIONSHIPS
Some state
laws require that early in any real estate relationship,
real estate brokers or salespersons discuss with consumers
what type of agency representation or relationship they
desire. An agency relationship is based on one person
representing the interests of another person, and Real
Estate Sales Associates, who are licensed by the State with
a broker, represent a person for the sale or purchase of a
property.
The type of
relationship formed between the Sales Associate and the
client is called a fiduciary relationship. A fiduciary
relationship is one based on TRUST, as evidenced by the
seven duties owed to the client: Loyalty, Diligence,
Confidentiality, Reasonable Care, Obedience, Disclosure, and
Accounting. The source of compensation does not determine
agency, in that compensation can be paid by the buyer,
seller, both, or neither (subject to restrictions under
applicable state law).
Currently, there are
several categories of agency relationships; the available options
for MN are as follows:
I. Seller's Broker:
A broker who lists a property, or a salesperson who is licensed to
the listing broker, represents the Seller and acts on behalf of the
Seller. A Seller's broker owes to the Seller the fiduciary duties
described below. (2) The broker must also disclose to the Buyer material
facts as defined in MN Statute 82.22, Subd. 8, of which the broker is
aware that could adversely and significantly affect the Buyer's use or
enjoyment of the property. If a broker or salesperson working with a
Buyer as a customer is representing the Seller, he or she must act in
the Seller's best interest and must tell the Seller any information
disclosed to him or her, except confidential information acquired in a
facilitator relationship (see paragraph V below). In that case, the
Buyer will not be represented and will not receive advice and counsel
from the broker or salesperson.
II. Subagent: A
broker or salesperson who is working with a Buyer but represents the
Seller. In this case, the Buyer is the broker's customer and is not
represented by that broker. If a broker or salesperson working with a
Buyer as a customer is representing the Seller, he or she must act in
the Seller's best interest and must tell the Seller any information that
is disclosed to him or her. In that case, the Buyer will not be
represented and will not receive advice and counsel from the broker or
salesperson.
III. Buyer's Broker:
A Buyer may enter into an agreement for the broker or salesperson to
represent and act on behalf of the Buyer. The broker may represent the
Buyer only, and not the Seller, even if he or she is being paid in whole
or in part by the Seller. A Buyer's broker owes to the Buyer the
fiduciary duties described below. (2) The broker must disclose to the
Buyer material facts as defined in MN Statute 82.22, Subd. 8, of which
the broker is aware that could adversely and significantly affect the
Buyer's use or enjoyment of the property. If a broker or salesperson
working with a Seller as a customer is representing the Buyer, he or she
must act in the Buyer's best interest and must tell the Buyer any
information disclosed to him or her, except confidential information
acquired in a facilitator relationship (see paragraph V below). In that
case, the Seller will not be represented and will not receive advice or
counsel from the broker or salesperson.
IV. Dual Agency:
Broker Representing both Seller and Buyer: Dual agency occurs when one
broker or salesperson represents both parties to a transaction, or when
two salespersons licensed to the same broker each represent a party to
the transaction. Dual agency requires the informed consent of all
parties, and means 1hat the broker and salesperson owe the same duties
to the Seller and the Buyer. This role limits the level of
representation the broker and salesperson can provide, and prohibits
them from acting exclusively for either party. In a dual agency,
confidential information about price, terms and motivation for pursuing
a transaction will be kept confidential unless one party instructs the
broker or salesperson in writing to disclose specific information about
him or her. Other information will be shared. Dual agents may not
advocate for one party to the detriment of the other. (3)
Within the limitations
described above, dual agents owe to both Seller and Buyer the fiduciary
duties described below. (2) Dual agents must disclose to Buyers material
facts as defined in MN Statute 82.22, Subd. 8, of which the broker is
aware that could adversely and significantly affect the Buyer's use or
enjoyment of the property.
V. Facilitator: A
broker or salesperson who performs services for a Buyer, a Seller or
both but does not represent either in a fiduciary capacity as a Buyer's
Broker, Seller's Broker or Dual Agent. THE FACILITATOR BROKER OR
SALESPERSON DOES NOT OWE ANY PARTY ANY OF THE FIDUCIARY Duties LISTED
BELOW, EXCEPT CONFIDENTIALITY, UNLESS THOSE DUTIES ARE INCLUDED IN A
WRITTEN FACILITATOR SERVICES AGREEMENT. The facilitator broker or
salesperson owes the duty of confidentiality to the party but owes no
other duty to the party except those duties required by law or contained
in a written facilitator services agreement, if any. In the event a
facilitator broker or salesperson working with a Buyer shows a property
listed by the facilitator broker or salesperson, then the facilitator
broker or salesperson must act as a Seller's Broker (see paragraph I
above). In the event a facilitator broker or salesperson, working with a
Seller, accepts a showing of the property by a Buyer being represented
by the facilitator broker or salesperson, then the facilitator broker or
salesperson must act as a Buyer’s Broker (see paragraph III above).
The fiduciary duties
mentioned above are listed below and have the following meanings:
Loyalty -
broker/salesperson will act only in client(s)' best interest.
Obedience -
broker/salesperson will carry out all client(s)' lawful instructions.
Disclosure -
broker/salesperson will disclose to client(s) all material facts of
which broker/salesperson has knowledge which might reasonably affect the
client's use and enjoyment of the property.
Confidentiality -
broker/salesperson will keep client(s)' confidences unless required by
law to disclose specific information (such as disclosure of material
facts to Buyers).
Reasonable Care -
broker/salesperson will use reasonable care in performing duties as an
agent.
Accounting -
broker/salesperson will account to client(s) for all client(s)' money
and property received as agent.
If
Seller(s) decide(s) not to agree to a dual agency relationship,
Seller(s) may give up the opportunity to sell the property to
Buyers represented by the broker/salesperson. If Buyer(s)
decide(s) not to agree to a dual agency relationship, Buyer(s)
may give up the opportunity to purchase properties listed by the
broker.
You should feel free to
discuss these agency representation options with your agent since it is
important that you have a thorough understanding of every aspect of the
real estate transaction.
Next:
GETTING THE HOUSE READY TO SELL;
"STAGING" YOUR HOME |
