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The Importance of Buyers Agency
The Importance of Buyers Agency
Currently, much has been mentioned about “Consumer Confidence” as being at an extremely low point throughout the world. Unfortunately, the investigations by the FBI on 14 “unnamed Lenders,” fraud by some unscrupulous Real Estate agents, lenders and appraisers has left a bad taste in the mouths of many home-owners and buyers.
I am making a decision to alter the format of my Blog and give reasons for the importance of working with Professional Realtors and Consultants in the present; not speculations on the future. In light of Super Bowl weekend (you will be reading this post-game), I am going to attempt to briefly explain the importance of Buyers Agency by relating it to the game of football.
First, let me be straightforward. Most buyers, and especially young buyers of homes, probably don’t know that up until 1993, the interests of the average buyer looking to buy a house weren’t fully protected. The Listing Agent who put the property on the market represented the seller. When you, the buyer, found the house that you wanted, even the agent that represented you was considered a sub-agent of the seller. This meant that your interests weren’t still being fully protected, because the buyer’s agent was actually working for the seller as well. This led to many problems and lawsuits over the years until the National Association of Realtors in the early 1990’s mandated that “Buyer Representation” be implemented.
So now, the buye’rs agent does three main things:
A. Represents the best interests of the buyer (Loyalty)
B. Will owe the buyer fiduciary duties (trust and confidentiality)
C. A buyer’s agent must give the seller all material facts so that the seller can make an educated decision (full disclosure)
And now, let’s get back to the football game. Think of the Listing Agent of a home as the coach for the “home team.” Now think of the Buyers Agent as the coach of the “Visitors Team.” Before 1993, the coach of the home team tried to get his team to win and the visitors coach could give compromising and confidential information (like reasons they want the house, motivations, final offer/price) to the home team to “win.” Now after 1993, the buyer’s agent, or the only goal of the coach for the “visitor’s team” is to help his team win the game by providing the following 6 characteristics:
1. “Undivided Loyalty” – The agent is prohibited from advancing any interests harmful to the client’s interest.
2. “Obedience” – The agent is required to act, following and abiding all lawful instructions, subject to the client’s continuous control and not making decisions for that client without expressed permission.
3. “Reasonable care and diligence” – The agent is required to protect the client from foreseeable risks of harm or damage.
4. “Confidentiality” – The agent is prohibited from communicating personal information about the client that was given to or acquired by the agent.
5. “Full Disclosure” – The agent is required to disclose honestly all information concerning the transaction that might affect the decisions a client makes.
6. “Accounting” – The agent is required to promptly report to the client all money and property received and paid out.
If you have any further questions about representation or tips for buyers, go to www.NewPhaseRealty.com
By the way, I believe that the Super Bowl that many of us watched on Sunday night was one of the best-matched and well-performed final games of the season that the NFL has put together in my lifetime.
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