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Real Estate Agency, North Fork, Long Island

January 25th, 2008 category: Buyers, East End LI Foreclosures, Real Estate News, Real Estate Philosophy, Sellers

If you are thinking about selling or buying a home on the North Fork of Long Island, New York, real estate companies have a revised document for you to sign with regard to AGENCY RELATIONSHIPS.

Acknowledgement of agency laws is required by the New York Department of State in order to encourage all consumers to understand what role a Realtor will play in the way of representation to each party- the seller and the buyer. In our opinion, the bold-ed verbiage is worth note. In that way, it differs from the form that you will be signing. THIS FORM IS NOT A CONTRACT.

The following is taken directly from the New York Disclosure Form for Buyers and Sellers, and will be presented to you, with an explanation of each representation so that you are able to determine who is on your “side”, once the agency relationship has been determined. As offered by the DOS, “this disclosure will help you to make informed choices about your relationship with the real estate broker and its sales associates.”

Sellers Agent: A sellers agent is an agent who is engaged by a seller to represent the seller’s interests. The seller’s agent does this by securing a buyer for the seller’s home at a price and on terms acceptable to the seller. A seller’s agent has, without limitation, the following fiduciary duties to the seller: reasonable care, undivided loyalty, confidentiality, full disclosure, obedience, and duty to account. A seller’s agent does not represent the interests of the buyer. The obligations of a seller’s agent are also subject to any specific provisions set forth in an agreement between the agent and the seller. In dealings with the buyer, a seller’s agent should a) exercise reasonable skill and care in performance of the agent’s duties; b) deal honestly, fairly, and in good faith; and c) disclose all facts known to the agent materially affecting the value or desirability of property, except as otherwise provided by law.
Buyer’s Agent: A buyer’s agent is an agent who is engaged by the buyer to represent the buyer’s interests. The buyer’s agent does this by negotiating the purchase of a home at a price and on terms acceptable to the buyer. A buyer’s agent has, without limitation, the following fiduciary duties to the buyer: reasonable care,undivided loyalty, confidentiality, full disclosure, obedience and duty to account. A buyers agent does not represent the interests of the seller. The obligations of a buyer’s agent are also subject to any specific provisions set forth in an agreement between the agent and the buyer. In dealings with the seller, a buyer’s agent should a) exercise reasonable skill and care in performance of the agent’s duties; b) deal honestly, fairly, and in good faith;and c) disclose all facts known to the agent materially affecting the buyer’s ability and/or willingness to perform a contract to acquire seller’s property that are not inconsistent with the agent’s fiduciary duties to the buyer.

Broker’s Agent: A broker’s agent is an agent that cooperates or is engaged by a listing agent or a buyers agent (but does not work for the same firm as the listing agent or buyer’s agent) to assist the listing agent or buyers agent in locating a property to sell or buy, respectively, for the listing agent’s seller or the buyer’s agent’s buyer. The broker’s agent does not have a direct relationship with the buyer or seller and the buyer or seller can not provide instructions or direction directly to the broker’s agent. The buyer and the seller therefore do not have vicarious liability for the acts of the broker’s agent. The listing agent or buyers agent do provide direction and instruction to the broker’s agent, and therefore the listing agent or buyer’s agent will have liability for the acts of the broker’s agent.

Dual Agent: A real estate agent may represent both the buyer and the seller if both the buyer and the seller give their informed consent in writing. In such a dual agency situation, the agent will not be able to provide the full range of fiduciary duties to the buyer and seller. The obligations of an agent are also subject to any specific provisions set forth in an agreement between the agent, the buyer and the seller. An agent acting as a dual agent must explain carefully both the buyer and the seller that the agent is acting for the other party as well. The agent should also explain the possible effects of dual representation, including that by consenting to the dual agency relationship the buyer and seller are giving up their right to undivided loyalty. A buyer or seller should carefully consider the possible consequences of a dual agency relationship before agreeing to such representation.

Dual Agent with Designated Sales Agents: If the buyer and seller provide their informed consent in writing, the principals or the real estate broker who represents both parties as a dual agent may designate a sales agent to represent the buyer and another sales agent to represent the seller to negotiate the purchase and sale of real estate. A sales agent works under the supervision of the real estate broker. With the informed consent of the buyer and the seller in writing, the designated sales agent for the buyer will function as the buyer’s agent representing the interests of and advocating on behalf of the buyer and the designated sales agent and the designated sales agent for the seller will function as the seller’s agent representing the interests of and advocating on behalf of the seller in negotiations between the buyer and the seller. A designated sales agent range of fiduciary cannot provide the full duties to the buyer or seller. The designated sales agent must explain that like the dual agent under whose supervision they function, they cannot provide undivided loyalty. A buyer or seller should carefully consider the possible consequences of a dual agency relationship with designated sales agents before agreeing to such representation.

(emphasis added)

For sellers, the other consideration when reviewing agency is to make a determination as to which agency, if any, you will offer compensation, particularly if your Realtor is promoting your property on the Multi List system of Long Island (MLSLI, with the feeder to Realtor.com). Realtors utilize this system to provide exposure for your property, and your compensation is advertised to the Realtor community with the following designations defined above:

SA, or seller’s agent

BA, or buyer’s agent

Broker’s Agent

For sellers, understanding the advantages/ramifications of each agency compensated is imperative. Establish what is best for you by discussing this with a few Realtors to gain as much comprehension as possible. Full understanding on your part of each designation is the responsibility of the Realtor who lists your home, sells your home, or facilitates the purchase of a new home- clarity on the part of the Realtor involved will facilitate an easier transition for both sellers and the buyers that purchase your home. KEYWORD: FIDUCIARY.

Call us if you’d like to have a conversation about Agency relationships. While we offer opinions on all things real estate, this is a serious consideration for consumers- too much information isn’t enough.

One Response to “Real Estate Agency, North Fork, Long Island”

OptionsRealty.com » Blog Archive » Buyer Agency on The North Fork of Long Island Says:
February 1st, 2008 at 3:54 pm
[…] We have posted for your review a disclosure that you will be required to acknowledge when you choose to work with a real estate agent/Realtor in the state of New York. Please see previous blog post here. […]