Your real estate agent must obey you? Yes, they must. Not just ethically, but legally. When you hire a real estate agent, you are really hiring their real estate broker, with the agent acting for the broker. Many people do not realize that all real estate brokers owe certain fiduciary responsibilities to their clients.
These specific fiduciary responsibilities include:
Reasonable care and diligence
1. Obedience – A broker is obligated to obey promptly and efficiently all lawful instructions of his client or principal. The key word here is lawful.
2. Loyalty – A duty of loyalty is one of the most fundamental fiduciary responsibilities owed by a broker to his client. The broker must act at all times in the best interest of his client to the exclusion of other interests, including the agent’s own self-interest. The broker must also avoid any conflicts of interest that might compromise or dilute the broker’s undivided loyalty to his client’s interests.
3. Full Disclosure – A broker is obligated to disclose to his client all relevant and material information that the broker knows and that pertains to his scope of agency. In other words, the broker must not keep any information from his client.
4. Confidentiality -A real estate broker must keep confidential any information that might weaken his client’s bargaining position if it were revealed.
5. Reasonable Care and Diligence – A real estate broker is assumed to have the skill and expertise in real estate matters superior to that of the average person. The broker is therefore under the duty to use his superior skill and expertise while pursuing his client’s affairs.
6. Accounting – All real estate brokers must account for all money or property belonging to his client that is entrusted to him. Examples are earnest money deposits, deeds and other financial documents.
Many people do not realize that real estate broker’s have these strict ethical and legal fiduciary responsibilities to their clients. It isn’t any wonder, with so many agents wantonly ignoring these issues and conducting their business in unbecoming ways.
You as a consumer can demand a difference. There are brokers who strongly adhere and abide by these tenets in their real estate dealings and you have every right to employ one of these brokers. When the public finally says “no” to the unethical and frankly illegal dealings of many brokers, the industry will finally start to clean up its act. But it starts with you, the consumer.
This is a commission based business – these brokers do not get paid unless you hire them and something sells. If you are currently involved with an unethical agent, contact their broker to get out of the contract. If this isn’t allowed, contact the local real estate board and file a formal complaint. That will get someone’s attention.
If you are currently looking for an agent/broker, ask family and friends for a referral. Excellent agents survive on a referral based business. You won’t find them focusing their business on strangers. They are able to focus on the clients who already know, love and trust them because they have earned that trust. They know how to treat clients, they act respectfully and ethically, and they deserve your business.