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May
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Broomfield Real Estate Agent: Legal Responsibilities

Buying a House in Broomfield ColoradoIt’s important to understand what legal responsibilities your Broomfield real estate agent has to you and to other parties in the transaction when you are buying a home for sale. Simply ask your agent or a Broomfield Realtor you might be considering working with exactly what type of agency relationship they have or would have with you. Many agents do not go into the details of working relationships and qualifying what their role and status would be in helping you in your search for homes in Broomfield Colorado. So here are the general definitions of what can be thought of as defining working relationships for client and agent situations:

Listing Agent or Seller’s Agent (sometimes referred to as a Seller’s Representative)
Someone who hires a Listing Agent should know that agent represents you, the person who owns a Broomfield property for sale. All fiduciary duties of the agent are owed to the Seller. This means that the agent has a fiduciary duty and obligation to look out for your best interests and to take any action to protect any situation that might compromise your position as a Seller both financially and or any motivations you might have in selling your home. The agency relationship usually is created by a listing contract that you both sign. This is a legally binding contract and it protects your best interests and at the same time it allows protection for the agent for his or her time and efforts.

Buyer’s Agent or Selling Agent (sometimes referred to as a Buyer’s Representative)
A Buyer’s Agent is hired by prospective home buyers to represent them in a real estate transaction. The Buyer’s Agent works in the buyer’s best interest throughout the transaction and owes fiduciary duties only to the Buyer. The Buyer can pay a Broomfield Realtor directly through a negotiated fee, or the Buyer’s Agent may be paid by the Seller or through a commission split with the Seller’s Agent.

Broadlands Broomfield Colorado Real Estate Information

 

Subagent
This is the least common type of agency relationship that occurs. Subagency usually arises when a cooperating sales associate from another brokerage, who is not the buyer’s agent, shows property to a buyer. In such a case, the subagent works with the buyer as a customer but owes fiduciary duties to the listing broker and the seller. A subagent owes the same fiduciary duties to the agent’s customer as the agent does. Although a subagent is not able to assist the Buyer in any way that would be detrimental to the Seller, a buyer as a customer can usually anticipate treatment to be straightforward and honest by the subagent. Colorado state laws require fair treatment and it is important that subagents fully explain their duties to buyers and present a disclosure form regarding relationships.

Disclosed Dual Agent
Dual agency is a relationship in which the brokerage firm represents both the buyer and the seller in the same real estate transaction. Dual agency relationships do not carry with them all of the traditional fiduciary duties to clients. Instead, dual agents owe limited fiduciary duties. Because of the potential for conflicts of interest in a dual-agency relationship, it’s vital that all parties give their informed consent. In many states, this consent must be in writing. In the State of Colorado dual agency is not allowed. Either the agent is working for the Seller or the Buyer, or that agent is working for neither. Disclosed dual agency, in which both the Seller and the Buyer are being represented, and they are made fully aware of that fact, is legal in most states.
Transaction Broker (also called a Non-agency Agreement)
Some states permit a real estate licensee to have a type of nonagency relationship with a consumer. These relationships vary considerably from state to state, both as to the duties owed to the consumer and the name used to describe them. Very generally, the duties owed to the consumer in a nonagency relationship are less than the complete, traditional fiduciary duties of an agency relationship. And typically does not save any mondy and overall is less effect in saving money and time and the reduced stress of buying a home.

Designated Agent (also called an appointed agent)
In this situation the managing broker is able to designate which licensees in the brokerage will act for the interests of the Seller and which will act for the Buyer. Designated agency avoids the problem of creating a dual-agency relationship for licensees at the brokerage. The designated agents give their respective clients representation in full, with all of the expected responsibilities and fiduciary duties. The managing broker who runs the firm still has the responsibility of supervising both groups of licensees throughout the transaction.

Views of Open Space in the North Front Range Real Estate Market

 

Thinking about Broomfield CO real estate or other homes for sale choices in beautiful Colorado? We are here to aid you in your real estate needs and please keep in mind that we are top experienced Broomfield realtors in the market for servicing the purchase of foreclosures, recently sold properties, new homes for sale, Broomfield school information and much more.

Have a Great Day!

Shaun Werkele 303-250-4735

Janelle Werkele 303-668-3111

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2 Responses to “Broomfield Real Estate Agent: Legal Responsibilities”


  1. May 10, 2012 at 9:31 pm

    Many states have outlawed Dual Agency, and for the consumer, I wish all fifty states would ban the practice.

    http://www.lakerealtors.us/blog/Buyers+Beware+Dual+Agency

    • May 14, 2012 at 4:40 am

      You are right, it is not possible to work both sides of the transaction claiming that you intrinsically have the best interests of both the Buyer and the Seller just does not work. I like the example on your post giving the example about a divorced couple being represented by the same attorney. Not to mention the strain it puts on the agent attempting to make the best outcome for both parties. Nevertheless, it is an option still offered in most real estate markets across the states. Thanks for the comment.


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