NY Times Real Estate Q&A: Using One Broker for Buying and Selling
I admit it: Agency Law is a pain in the neck. But it IS the law, and all Realtors are responsible for understanding and following it. The Law of Agency in its basic form really is not terribly complicated. However, once Dual or Designated Agency comes up, as in the following situation, it can get confusing. It is incumbent on the broker to insure that everyone knows what to expect. Read on, and then read my comments.
By: Jay Romano
I found an apartment that I’m interested in. But the broker for this apartment is also the broker whom I wanted to use to sell my own apartment, although I have not signed with him yet. Should I avoid listing with the same firm because of a conflict of interest?
“No,” said Edward I. Sumber, a White Plains lawyer who is also legal counsel to a number of New York real estate groups, including the Westchester Board of Realtors. “Always list with the person who is most effective and has your best interests in mind.”
In New York, Mr. Sumber said, a consumer can choose to work with a broker as a dual agent. In such circumstances, the broker works for the seller and the buyer with the informed consent of both. “Effective people get the job done,” he said.
He noted that a dual agent cannot absolutely guarantee undivided loyalty. But such loyalty, he said, might not be as valuable as having a respected, honest and effective agent working on your behalf.
My Comments posted to the NY Times:
Ed Sumber is a very well respected expert on Real Estate Law in Westchester and he is absolutely correct. I have been involved in similar transactions successfully and the key to handling it properly is simply one word;
DISCLOSE
It is absolutely imperative (as well as required by the Real Property Law) that all agency relationships be disclosed in writing. A good agent will take the extra step of sitting down with the client or customer and clearly explain what the brokers responsibilities are and what they can expect. Simply giving the client/customer an executed copy of the Agency Disclosure (which is required) is not enough, especially in Dual/Designated Agency situations. Keeping the communications lines open are crucial to insure there is no confusion as to the role of the broker.
When I list a property or take on a new client or customer, one of the things I tell them is: “there is nothing worse than you asking me during the transaction: whom do you represent?” If that happens, the broker has not done their job.
Agency law can get technical at times, and I do not have every answer. But it is incumbent on all agents to know the basics, and to know enough to realize when they do not know the answer and to get help.
