CAN AGENTS REPRESENT SELLER AND THE BUYER, TOO? (C) 2013 by Wayne D. Lewis, Sr.
A Discussion on Dual
Agency in Louisiana
© 2013 by Wayne D.
Lewis, Sr.
A buyer is shown a property by an agent. The agent has notified the buyer that they (
the agent) are the listing agent, or the agent representing the seller. In so doing, the agent further advises the
buyer that they represent the seller, but they (the buyer) have the option of
being represented by the listing agent, or may choose to work with another
agent. What does the buyer need to be
aware of if he/she decides to go with the agent representing the seller? The best way to summarize is by each group’s role
in the home buying/selling process, as done by seller, agent and buyer.
- Seller’s expectations:
- Agent respects the seller’s confidentiality,
- Agent conducts themselves honestly with a commitment to moral behavior in their representation
- That agent will market their home consistently for the most qualified buyers
- That agent will take reasonable care to ensure that an offer made does not put the seller in a compromising position.
- Agent’s commitment:
- Confidentiality of client’s personal information
- Commitment to ensuring client’s knowledge of requirements and protocols in the process of selling and/or purchasing a home
- To seller and/or buyer to ensure that either or both are able to move forward confidently in their respective decision(s).
- Buyer’s expectations:
- Agent respects the buyer’s confidentiality,
- Agent conducts themselves honestly with a commitment to moral behavior in their representation
- That agent will make a consistent effort to help buyer find a home according purchaser’s financial and personal expectations
- That agent will take reasonable care to ensure that an offer made does not put the buyer in a compromising position.
Seller’s Move-
In Louisiana ,
sellers are generally advised of the option that in the event of such a
circumstance, that their agent will present the option to them as sellers for
their agent to represent a buyer. Most
sellers don’t object, but often specify that they are the priority in the
negotiations. Whatever that may mean, it
should mean that the seller has the first right of refusal to any decisions
made regarding the sale of the house whether the agent is representing seller
and buyer or just the seller.
Buyer’s Move
If an agent shows one of their specifically listed
properties, chances are the agent has already made arrangements with his/her
seller that if a buyer is not represented by an agent, the listing agent can
present themselves to a buyer to represent them, as well. The buyer’s decision is key. He or she has to decide in advance that should
a conflict between the buyer and the seller arises, whose side will the agent
take? That is to say: irrespective of
right or wrong, whose side will the agent take?
Example 1:
A seller who presumes that a wall-mounted flat screen TV is
to be removed when the seller moves out of their home, while the buyer believes
that the same TV is apart of the sale of the house. The agent’s role must be according to the
contract as written. Taking such a
position may not put the agent on good terms with a seller, but it is important
that the agent act in such a way as to not disregard the terms and conditions
of the contract, or state law.
Example 2:
If in another case, the seller agrees contractually, that
the they will make any necessary repairs on the intended home at an amount not
to exceed $1500, but the buyer may disagree and ask for $2500 in repairs. If the issue becomes a point of
contradiction, it will be up to the agent to represent both seller and buyer in
as objective a manner as possible to resolve this matter between the seller and
buyer. It is not out of the question
that such an issue maybe come emotional, but it is reasonable also for the
agent to speak to both customers by ensuring that a middle ground is reached,
minimizing the possibility that the offer to purchase is not compromised.
The Pitfalls of Dual
Agency:
If there is a problem
It is up to the agent to be aware of any possible problem(s)
that may cause for the buyer of seller to become agitated enough that they
question his/her commitment to the other of the customers whom they represent. The agent must be prepared to offer an option
that allows for the buyer or seller to seek another agent to represent them.
Who is the listing
agent’s first obligation to?
An agent’s first obligation is to the seller, providing of
course that is whom they first represented via a listing. If in the case there is a buyer’s agreement
between the agent and the buyer, then their first obligation is to the buyer. Without question, it is justifiable to
suggest that a buyer walks into a lion’s den when they agree to be represented
by a listing agent. But it appears to be
a far cry from reliable that no agent can represent with consistency and
objectivity both the seller and the buyer.
Guiding principles
Any agent who is a Realtor® has received continued training
on their obligations as it relates to communicating and representing both buyer
and seller. Each of us are held to a
high level of ethical standards when it comes to presenting ourselves between
buyer and seller, so that in the end, both are most satisfied in having been
given a fair and equitable position in the home buying process.
Are there no circumstances in which a dual agency does not
result in disagreements or conflicts?
Not at all. But it is reasonable
to suggest that there are fewer cases of dual-agent conflicts as a result of
on-going education for Realtors.
Recommendations
Seller(s)-Be sure
to understand what it means to allow your listing agent to represent both you
and a buyer when your home is on the market.
Make your expectations clear and ensure that you are fully informed
regarding the relationship between your agent and the buyer. In other words, make sure that the agent and
the buyer are not related, for your peace of mind.
Agent(s)-Be
absolutely clear as to your role to either the seller(s) and/or the buyer(s) to
be sure of their understanding of your limitations or expectations that you
will be required to meet throughout the listing, negotiating, and home buying
process. If there is a prior or existing
relationship between you as an agent and/or the seller(s) and buyer(s), it is
important that this information be relayed well in advance of any signatures or
agreements relative to the sale of the property.
Buyer(s)- Be sure
to understand what it means to allow the selling agent to represent you as well
as the seller. If you are not sure, or
are not comfortable as a buyer with dual agency representation, let the listing
agent know of your decision and why.
The listing agent can suggest colleague or allow you to select an agent
of your choice.
Dual Agency: How Your Agent Maybe 2Xing You:
Conclusion
It is safe to suggest that dual
agency is not without its challenges.
But it is also safe to suggest that agents who are experienced in
representing both sellers and buyers, can reasonably provide constructive and
reliable information necessary to help both buyers and sellers to make
reasonable decisions throughout the home buying process. Granted, the listing agent does owe their
greatest level of obligation to the seller, the listing agent has also been trained extensively
in maintaining confidentiality and upholding the highest of ethics, two very
important aspects of the relationship that agents and their customers/clients can
depend on to make the home buying process very successful.
Not an intent to solicit the clients or agent of any other broker. Information provided here, while deemed to be
from reliable sources is not guaranteed.
Wherever needed, you are encouraged to seek legal advice as this is not
intended to be legal advice.
Labels: Dual Agency, Louisiana Law Dual Agency, Real Estate Agency
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