Understanding Whom Real
Estate Agents Represent
Agreement to the terms
and conditions of this Notice is required if you are conducting business in
the State of Maryland. Prior to signing a hard copy version with your broker
and/or if you are conducting business in any other state, you should read
and understand the terms and conditions of this Notice.
Before you decide to sell
or buy or rent a home you need to consider the following information:
Agents Who Represent
Seller's Agent: A seller's
agent works for the real estate company that lists and markets the property
for the sellers, or landlords, and exclusively represents the sellers or landlords.
That means that he or she may assist the buyer or tenant in purchasing or
renting the property, but his or her duty of loyalty is only to the sellers
or landlords. The seller pays the seller's agent's fees as specified in a
written listing agreement.
Cooperating Agent: A cooperating
agent works for a real estate company different from the company for which
the seller's agent works. The cooperating agent can assist a buyer or tenant
in purchasing or renting a properly, but his or her duty of loyalty is only
to the sellers or landlords. The cooperating agent's fee is paid by the sellers
or landlords through the sellers agent's company.
Agents Who Represent
Presumed Buyer's Agent
(no written agreement): When a person goes to a real estate agent for assistance
in finding a home to buy or rent, the agent is presumed to be representing
the buyer and can show the buyer properties that are not listed by the agent's
real estate company. A presumed buyer's agent may not make or prepare an offer
or negotiate a sale for the buyer. The buyer does not have an obligation to
pay anything to the presumed agent.
If for any reason the
buyer does not want the agent to represent him or her as a presumed agent,
either initially or at any time, the buyer can decline or terminate a presumed
agency relationship simply by saying so.
Buyers Agent (by written
agreement): A buyer or tenant may enter into a written contract with a
real estate agent that provides that the agent will represent the buyer or
tenant in locating a property to buy or rent. The agent is then known as the
buyer's agent. That agent assists the buyer in evaluating properties and preparing
offers, and negotiates in the best interests of the buyer or tenant. The agent's
fee is paid according to the written agreement between the agent and the buyer
or tenant. If you as a buyer or tenant wish to have an agent represent you
exclusively, you must enter into a written buyer agency agreement.
Dual Agents: The
possibility of dual agency arises when the buyers agent and the seller's agent
both work for the same real estate company, and the buyer is interested in
properly listed by that company. The real estate company, or broker, is called
the "dual agent". Dual agents do not act exclusively in the interests
of either the seller or buyer, or landlord or tenant, and therefore cannot
give undivided loyalty to either party. There may be a conflict of interest
because the interests of the seller and buyer may be different or adverse.
If both seller and buyer,
or landlord and tenant, agree to dual agency by signing a Consent For Dual
Agency form, then the real estate company (the "dual agent") will
assign one agent to represent the seller or landlord (the sellers "intra-company
agent") and another agent to represent the buyer or tenant (the buyers
"intra-company agent"). Intra-company agents may provide the same
services to their clients as exclusive seller's or buyers agents, including
advising their clients as to price and negotiation strategy, provided the
clients have both consented to be represented by dual agency.
If either party does not
agree to dual agency, the real estate company may withdraw the agency agreement
for that particular property with either the buyer or seller, or both. If
the seller's agreement is terminated, the seller must then either represent
himself or herself or arrange to be represented by an agent from another real
estate company. If the buyer's agreement is terminated, the buyer or tenant
may choose to enter into a written buyer agency agreement with an agent from
a different company. Alternatively, the buyer or tenant may choose not to
be represented by an agent of his or her own but simply to receive assistance
from the seller's agent, from another agent in that company, or from a cooperating
agent from another company.
No matter what type of
agent you choose to work with, you have the following rights and responsibilities
in selling or buying or renting property:
- 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 other party; 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 agents should be in writing and should explain the duties and
obligations at the agent. The agreement should explain how the agent will
be paid and any fee sharing agreements with other 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
If you have any complaints
about a real estate agent, you may file such complaints with the appropriate
Real Estate Commission: