Quite often potential would be buyers refer to the person they bought their home from as their agent. It sounds reasonable but it is definitely not accurate. Although there are several meanings to the word Agent, let us refer to the definition as a person who works for or manages an agency.
An example of this would be a person who is the agent of the insurance company and they legally represent the company, not the customer. Even an independent agent who can place a policy with different companies is still an agent of the company.
A mortgage officer, in most cases is an employee and represents the company. In addition, the same is true for a title or escrow officer. It is important to understand the actual relationship to know what you can expect from them. In Real Estate, there is a procedure for the professional to create formal agency relationships. This requires a fiduciary/statutory responsibility that places the principals’ interests above the agent’s own personal interests.
In today’s terms, potential consumers refer to an agent, as “this is my agent.” Unlike other professions, Real Estate is in a different category by itself. Agency disclosure plays a major part in representation, and, unless the potential buyer understands agency relationships, the word agent could be misconstrued.
An agent owes honesty and accountability to a customer. The principal can expect complete disclosure, obedience, loyalty, reasonable skill, care, and confidentiality from their agent.
Understanding agency relationships brings a valuable experience to the buying or selling process to coordinate all aspects of the transaction from start to finish.
