Customer or Client, What’s the Difference?
Unless a party has a representation agreement with a real estate agent, the agent is a sub-agent of the owner and must place the interest of the owners first.
This document, Information About Brokerage Services ,explains the relationship and duties of agents and brokers with clients and customers. Reading it will help you understand those relationships and help you determine whether or not you wish to be represented in a real estate transaction. If there is anything that you do not understand about the information contained in this document, contact a real estate attorney for clarification.
If you are not represented by an agent, you are a Customer and the agent must:
- Be Loyal to seller’s, and be Honest to all parties.
- Keep information about the seller confidential. Tell the seller all they know about the buyer.
- Focus on the seller-client’s property. Provide just the material facts to buyer customer.
- Provide only price information that supports the sellers listing price to buyer customer.
- Negotiate on behalf of the seller.
- Work to resolve problems to the seller’s advantage and satisfaction.
If you are represented by an agent then you are a real estate Client and the agent must:
- Pay full attention to your needs. Put your needs first (fiduciary duty).
- Tell you all that they know about the the other party.
- Keep information about you confidential, for ever.
- Focus on the choices that satisfies your needs.
- Provide material facts as well as professional advice only to you.
- Provide price counselling based on comparable properties and their professional insights.
- Negotiate on your behalf.
- Work to solve problems to your advantage and satisfaction.
An agent can do some things for you, even without a signed representation agreement, like helping you locate and view properties but an agency relationship can be created, accidentally, through the actions of the parties. Signing a representation agreement can help eliminate confusion by creating a clear, written, relationship between you and the agent.
| Customer (not represented) | Client (represented) | Discussion |
|---|---|---|
| Honesty | Honesty | You should always get honesty from your REALTOR®. It's a Requirement! |
| Loyalty to Seller's Needs | Loyalty to Buyer's Needs | Real Estate Agents and REALTORS® work for Sellers unless you have a Buyer's Representation Agreement with the REALTOR® or agent. |
| Relay to seller all information received from buyer | Keep All Information Confidential between the Buyer and REALTOR®. | REALTOR® must tell All to Seller unless your have a representation agreement |
| Focus on our seller-clients needs In selling; limit property to MLS only | Consider alternative solutions in finding property to fit the buyer's needs | More willingness to show properties, including non-MLS properties, since it it more likely that the REALTOR® will actually get paid for the work that they do. |
| Less attention given in searching new listings. | Given first opportunity to view new listings and spend more time in finding properties by various means. | Send emails showing MLS listings for Customer and Show MLS and other Properties to Clients. |
| Disclose just material facts regarding properties discussed | Full disclosure of all facts and pertinent information | Do lots of Research into the Pros and Cons of Each Property for the Client and Only the Basics for the Customer. |
| No advice regarding property, only the facts | Advice and opinion along with facts; Educate the Buyer to Make a More Informed Decision | Remember, the agent or REALTOR® represents the Seller unless you have a Signed Representation Agreement. |
| Get the best price for the seller and fulfill the sellers needs | Get the Best Price and Terms for the Buyer Client. | Remember, the agent or REALTOR® represents the Seller unless you have a Signed Representation Agreement. |
| Cannot give a Comparative Market Analysis" CMA unless it supports the seller's listing price | Provide as Much Information as Possible, on Comparable Sales, in order to Help the Client Determine Their Best Offer. | Market Value is determined by an Appraiser and Not By REALTORS® or Agents. A Comparative Market Analysis shows the Sold Price of Similar Properties Near the Property in Question. |
| No price counseling | Provide price counseling as well as some creative ways of making the offer more appealing and reducing your out-of-pocket expenses. | Remember, the agent or REALTOR® represents the Seller unless you have a Signed Representation Agreement. |
| Suggestions made regarding financing or any other terms must benefit the seller | Suggestions made in buyer-client's best interest | Remember, the agent or REALTOR® represents the Seller unless you have a Signed Representation Agreement. |
| Negotiate on behalf of seller | Negotiate on behalf of Buyer | Negotiation of price and terms are valuable tools of the experienced REALTOR® |
| Attempt to strengthen the seller's negotiating position | Attempt to strengthen the buyer's negotiating position | As a Client, you can take advantage of the skills and knowledge that your REALTOR® can provide you. |
| Attempt to solve problems and close the transaction to satisfy the seller | Attempt to solve problems and close the transaction to satisfy the buyer | Explore various ways to handle problems that benefit the buyer client. |
If you have any questions about this, contact a real estate attorney for more information. If you would like more information, click on the Request More Information link and fill in the information on the form.