Frequently I get phone calls from buyers wanting to submit a purchase offer on a home I have for sale without the use of their own real estate agent.
The prospective buyer will often mention that they either expect to get a commission refund or that their offer will be preferred over nearly identical offers. Some will say they don’t want a real estate agent to represent them. Others will say they want me to represent them. Almost never will these buyers ask about the conflict of interest this creates.
If a home buyer or seller gets significant advice or help from a real estate agent, that agent might be required to be bound by agency duties: “A fiduciary duty of utmost care, integrity, honesty, and loyalty…”. How can one person provide the utmost care to two people who are opposing each other in negotiations?
Even if a buyer or seller tells me they DO NOT want me to represent them, I could still be legally obligated to treat them as if I was representing them. This requirement is an “implied agency“.
This is a situation that has been around for many years. I handle it by having set up and running my team so that some agents represent home buyers while others represent sellers. When I get a call from a buyer I have them work with one of my buyer agents who does not represent the seller.
What many buyers don’t think about is that after an offer is accepted, there may still be significant negotiations, or if negotiations fail legal proceedings. Some of the common problems include: the buyer’s loan is not funded in time and the buyer needs to get a contract addendum accepted which extends the allowed time; the mover can’t move the owner’s furniture out in time and the seller needs an addendum; a follow-up inspection reveals new significant problems nobody wants to pay to repair but they must be repaired.
When a real estate agent or a real estate broker represents both the buyer and the seller, a dual agency agreement must be accepted by both the buyer and the seller.