3 Ways YOU can be represented by an agent. Real Estate Basics:::::: BUYER AGENCY/ SELLER AGENCY/ DUAL AGENCY. This certainly is not a fun topic for discussion, but really helpful and necessary! Hope it will help to clarify some of the confusion that comes along with choosing how you, as a client, want to be represented! And of course, this is by NC Commission Rules. It is different from state to state, but this is how it works in our state.
First, lets dive into Buyer Agency! If a client or potential buyer walks in an office, calls/texts, or emails, and says they would like to buy a house or property, the first step is to ask how they would like to be represented and then explain in detail. Also, they would need to sign the working with real estate brochure, that also explains representation in full. First step! If they want to be represented solely as a buyers agent, after completing the buyer agency agreement, then the realtor/agent would begin looking for property that meets their criteria. This means the realtor/agent would not be representing anyone other than that buyer. Realtor/agent would owe them complete loyalty and as a buyers agent would need to research and verify all the information regarding the properties very closely. Realtor/Agent would then begin showing the potential buyers property from other firms that other agents have listed for sale in the MLS (multiple listing service). If they find a property and make an offer, then the realtor/agent would be listed on the offer to purchase as a BUYERS AGENT. If and when it closes and the sale is final, agent would then receive the percentage dollar amount as advertised in MLS, for representing the buyers, as a buyer agent.
Seller Agency! This one is simple. When a realtor/agent takes a new listing, and agrees with the seller to sale their home or property, they become a sellers agent! This means realtor/agent will be representing only the sellers and no one else. After completing the necessary paper work, seller will pay the agreed upon commission percentage to you as a firm/realtor/agent, at closing if you successfully sale the house/property.
Dual agency! This is the tricky one. I owned a firm for almost 20 years and I explained this to my agents every week in a sales meeting. I think even after 20 years, there were still agents that never seemed to get this. I hope I can explain it to you in simple terms, so it makes sense and you get it! When a firm/realtor/agent takes a listing and agrees to be a sellers agent/realtor, first thing, is to ask permission from the seller to act as a dual agent; just in case there becomes a need to. If the sellers do not agree, then, most firms will not allow the realtor/agent to take the listing. Even though a particular realtor/agent takes and list a property, the firm actually owns this listing, not the realtor/agent. If a firm/agent list the property, and does not have the sellers permission to act as a dual agent, then, if a buyer who has a buyers agency agreement with the firm, request to see one of the firms/realtor/agent listings, realtor/agent cannot even show an in-house firm listing. Because, the firm/realtor/agent is already representing the sellers first as a sellers agent, and if firm/realtor/agent have also entered into a Buyers agency agreement, (to find the buyer a property), then in order to represent both clients, (seller and buyer) the seller and buyer both would have to allow and accept dual agency on both sides. Think of the firm as an entire pie, and the realtor/agents each a piece of the pie. There could be 3 or 4 or 16 realtor/agents in a firm, and they would all equal a piece of the pie. The Firm is the entire pie. So to enable each realtor/agent the ability to sale a firms listing, then it is of the upmost importance for the firm to have dual agency approval from the seller first, and also from the Buyer, to represent both in the event a buyer would like to see, and eventually purchase an in-house firm listing. Hope this helps to explain. I say often, “It take both a seller and a buyer to make a deal”!