Friday, December 18, 2009

What HUD.gov say's about Realtor Representation

Here's what HUD says, "It is your responsibility to search for an agent who will represent your interests in the real estate transaction. If you want someone to represent only your interests, consider hiring an “exclusive buyer’s agent”, who will be working for you."

Because 98% of all Real Estate Brokerages are Seller orientated, that is they sign a contract with the Seller, they can not provide Buyers Fiduciary Representation. Fiduciary Representation means Full Disclosure, Complete Confidentiality, seeing ALL properties meeting your requirements and putting the Buyers Best Interest First.

An Exclusive Buyer Agent can be found at brokerages that do NOT contract with Sellers. These Buyer Brokerages never list properties for sale and work exclusively for the Buyer.

Looking for your own Buyer agent?  Try  www.GetYourOwnBuyerAgent.com

Sunday, December 13, 2009

FLORIDA - a Transaction Agent State - What does it Mean?

Understanding “Transaction Brokerages”..

A Transaction Broker, in some state referred to as a Dual Agency, provide limited representation to clients. Their primary function is to FACILITATE a transaction between a Seller, usually their client and a Buyer. Florida is by statute a “Transaction Brokerage” State. Prior to 2008, an Agent was required to advise his prospective client who he represented. Today, that is not required. His representation roll has been reduced to that of a mediator.

a Transaction Broker can not provide these Critical Buyer services:

1… Be an advocate for you.
2… Negotiate the best price for you.
3… Negotiate the best terms for you.
4… Suggest an appropriate offering price.
5… Research on your behalf and bring to your attention, defects and/or problems.
6… Provide information about the seller motivation and position.
7… What the Seller paid for the property and his mortgage.
8… Research previous attempts to Sell the property.
9… Provide Fiduciary Representation.

Transaction (Agents) Brokers can and usually do switch from Transaction Broker to “Buyer’s Agent” to “Seller’s Agent”, back to Transaction (Agent) Broker.

The Question is: Who do these Agents really work for?

Answer…The Brokerage. All agents have employment contracts with the Brokerage they work for.

Ok, The Question to follow would be…

Who does the Brokerage work for?

Answer…If the Brokerage Lists properties for Sale, they have Legal Contracts with Property Owners to Market, Advertise, and Sell the owners property at the Price and Terms the Seller wants.

The Agents working for the Brokerage secure these Listings however, the Brokerage owns these Listing Contracts, Not the Agent.

All the Agents working for the Brokerage are obligated under these Listing Contracts and their Contractual Relationship with the Brokerage to Sell these Listings.

Now, the Obvious Question is…

How can the Brokerage’s Agents provide Buyers “Fiduciary Representation” ?

Answer… They Can’t. There is an inherent “Conflict of Interest” that prevents brokerages Contracting with Sellers from providing Buyers, “Fiduciary Representation“. It’s questionable that they can provide it to their Listing Clients.

The Solution…

Has been to choose up sides. Either you work with Sellers or work exclusively with Buyers! To this end, enter the Buyers Brokerage and Exclusive Buyer Agents. Because they do not take Listings or ever work with Sellers, they can provide Buyers Fiduciary Representation from Start to Finish. Finding an Exclusive Buyers Agent to work with may be more of a challenge then a traditional Listing Agent however. Searches on Exclusively Buyers Realty or FAEBA.org (newly formed Florida Association of Exclusive Buyers Agents) can get you to the right Exclusive Buyers Agent. “a Clear Choice for Today’s Sophisticated Buyer"