Gilson Terriberry
REALTOR®
I firmly believe that an informed consumer is my best client.
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I firmly believe that an informed consumer is my best client. |
| Seller's Information |
217-378-7483
| Just exactly what is a REALTOR®? Who does your "agent" really work for? What about when your property is shown by another agent or team in the same firm? What, exactly, does all of this mean? What can your agent do, and not do, for you? What can I do for you (that you cannot do for yourself)?
Just exactly what is a REALTOR®? We use a lot of labels in this business, REALTOR®, Real Estate Salesperson, Real Estate Agent, Designated Agent, Broker, Licensed Assistant and more. While specific licenses are required to practice the various aspects of real estate, not all licensed real estate practitioners are REALTORS®. REALTOR® is a registered trademark of the National Association of REALTOR® (NAR), the largest real estate trade organization in the United States, and may be used only by professional members of the Association. While anyone who has passed the requisite courses and the state real estate salesperson's licensing exam may, under the sponsorship of a sponsoring Broker, enter the real estate profession and practice as long as they obey the applicable state laws, only members of the NAR who have voluntarily agreed to adhere to the NAR code of ethics may use the designation of REALTOR®. It really is a higher standard. All REALTORS® are either Real Estate Salespeople who have fulfilled the state requirements for a real estate salesperson's license or Brokers. Brokers are real estate professionals who have taken additional courses and passed a more comprehensive licensing exam. Brokers may operate their own real estate practices, although not all choose to, while real estate salespeople are required to practice under a sponsoring broker. Finally, some brokers practice as salespeople, preferring to work under another sponsoring broker. A real estate agency is a business with which you, as a seller, may contract for services and assistance advertising, marketing and selling real estate. When you sign your Listing Agreement you have an agency contract with the real estate agency you are and the agency must adhere to certain requirements of agency law. The real estate salesperson with whom you deal is an employee or, more often, a subcontractor of the agency who will be designated as your agent in the transaction. If you have an issue with the performance of your Designated Agent, the person to go to is the sponsoring broker. And this is where things can get sticky. Who does your "agent" really work for? He or she probably works for you. Until recently, all agents worked for the seller no matter which side of the transaction they were on. This is no longer true. In fact, this arrangement, known as subagency, has been illegal in Illinois with regard to properties listed through any Multiple Listing Service (MLS) since 2000. However, when showing your house to a buyer, that same agent may not be entirely working for you. Yes, you have the listing contract with the firm for whom the agent works. The agency relationship created by your contract with that agent's company contains specific obligations including obedience and confidentiality as well as diligent effort in the best interests of the party represented. However, when showing your house to a potential buyer, that agent may have, by law, certain agency obligations to the buyer unless otherwise disclosed in writing. Dual agency when disclosed to both parties in writing is allowed in Illinois. You can see where this may place an agent in the awkward position of being unable to fully represent the best interests of either party. Today, Illinois recognizes three agency relationships in real estate. The seller's agent is pretty obvious, he or she listed the property and the company the represent has a written contract with you. Unless they are selling your house to their own client, they absolutely work for you. The buyer's agent, recognized buy Illinois law in 1995, is a tad less straightforward. He or she is presumed, written contract or not, to represent the buyer to whom the agent is showing properties, unless disclosed otherwise in writing. But, again, what if the property being shown was listed by the agent showing it? The disclosed dual agent, who must be disclosed and consented to in writing by both parties, represents both buyer and seller. That written disclosure is intended to alert both buyer and seller that they may have to assume greater responsibility for the protection of their interests than they would if each were represented independently. The agent must reconcile how their duties to the best interests of both clients, particularly duties like loyalty and the protection of confidential information (like the lowest price you would consider), can be fulfilled on behalf of both parties. I avoid dual agency. If you are not sure of your agent's relationship with you under all circumstances, ASK. What about when your property is shown by another agent or team in the same firm? This is where designated agency comes in. If every transaction required two firms, business would become quite difficult just because of the number of properties that may be listed by agents of any single firm. For that reason, Illinois recognizes a sponsoring broker's right to designate agents or teams to represent both parties (Yes, a team is considered like a single agent). Under designated agency, the buyer and seller are each considered fully represented and each designated agent is obligated to fully protect the best interests of the party they represent. Designated agency does not mean you have to take whomever the sponsoring broker selects for you. It does mean that when you select the agent you want to work with that agent will be designated as yours in the contract you sign with the firm. What, exactly, does all of this mean? When an agent shows a property, that agent is presumed by law, unless otherwise agreed in writing, to be representing the buyer. All of the duties required by agency are in force. When an agent other than your designated agent shows your property, they are not representing you. That agent, just like the agent representing you, is obligated to be loyal to his or her client, the buyer, to work diligently for the best interests of their client including getting them the best price possible and to keep confidential, both during and after the contract period, any confidential or proprietary information disclosed by their client. If your agent shows your property without disclosing, in writing and with consent, the nature of their agency relationship with you to the potential buyer, they may be in violation of the law. The only exception is when that agent is performing ministerial acts. Some examples of ministerial acts include; responding to consumer inquiries as to the availability and pricing of brokerage services, responding to inquiries concerning the price or location of a specific property, attending an open house and responding to questions about the property (not about you or your circumstances) from consumers, setting an appointment to view a property and completing business or factual information for a consumer on an offer or contract to purchase a particular property. If an agent searches for properties for a potential buyer to view, shows those properties to the potential buyer, helps negotiate an acceptable sales price in the interests of the buyer, and assists the buyer through the closing process, that agent is going well beyond ministerial acts and would be considered an implied agent of the buyer. Since this creates an obvious conflict of interest for an agent already under contract to represent you, full disclosure must be made to both you and the buyer and consented to by both in writing. Otherwise, that agent has become an illegal undisclosed dual agent with regard to that buyer and your property With full disclosure to both parties, this may not become a problem. Especially with regard to in full price purchase offers without any buyer contingencies (rare, but they do happen) things may go smoothly. You should remember, however, that upon disclosure of dual agency, your agent's responsibilities to you become severely limited. Dual agents may not disclose any confidential information about either client without that client's permission.
There is no requirement that you consent to dual agency. You have every right to insist that your agent represent you and only you. What can my agent do, and not do, for me? You should expect your agent to listen carefully and understand completely your desires concerning the sale of your property, the price you want to get, when you want to move and any conditions you wish to place on showing the property.
You should not expect your agent to violate any laws including fair housing laws. Your agent cannot advise buyers about schools, steer them to or away from certain neighborhoods or discuss any aspects of the demographic makeup of any neighborhoods. Your agent cannot restrict the showing of your property to anyone based on any social or demographic characteristics, although showings may be restricted to buyers who are financially pre-qualified or pre-approved for financing. You do. The commission and any fees agreed to in your listing contract represent your entire financial obligation to the listing brokerage and become due when you are brought a ready, willing and able buyer who meets your selling conditions. Typically, real estate commissions are paid by the seller to the listing broker who then compensates the selling broker. Both brokers then compensate their designated agents based on whatever employment or subcontract agreement they have with them. The total commission is set in the listing contract and the "cooperating broker commission" is stipulated by the listing broker when the property is placed in the Multiple Listing Service. The seller pays the full listing commission to the listing broker whether that broker or any other agency brings the buyer. What can I do for you (that you cannot do for yourself)? Why can't you get your own lawyer to draw up the contract, do the advertising yourself and sell your property on your own, thus saving the commission? You can and some people do. They put out a sign, they pay for classified advertising in the local newspaper. They deal with the curiosity calls. They show their property to a lot of folks who are "just getting an idea of what's out there." Sometimes a buyer shows up (more often than not accompanied by an agent who will require compensation for bringing them) and they get offered something like what they want for their house. Then they wait for the buyer to get financed. They handle the contingencies and arrange the inspections. They go to the closing with their lawyer. Sometimes everything goes smoothly. But did they actually save money? So, lets talk about For Sale by owner transactions.
In other words, a REALTOR® can actually get you more money faster for your property because the REALTOR® has expertise, access to market information and marketing resources that simply aren't available when you try to sell on your own. Remember, every day you don't close on the sale of your house is one more day you are paying to keep it. My commitment to you is that when the closing occurs on the sale of your property I will have done all I can to ensure that you be satisfied that your desires were met and confident that your interests were well taken care of. I guarantee it. If at any point you are unsatisfied in any way with my services, tell my broker. If he cannot resolve the situation or find you an agent that does satisfy you, walk away. We'll tear up the contract. *** Copyright ©2004 Gilson Terriberry. All rights reserved. Information contained herein is believed to be reliable
but is not guaranteed. |
