UNDERSTANDING WHOSE WHO
While you may never meet the broker/owner of a real estate firm you need to understand that all contracts are the property of the broker/owner of the real estate firm. All real estate agents and associate brokers work for and under the direction of their broker/owner. Both the broker and the agent can be called Realtors® if they are members of the National Association of Realtors®. In a typical real estate transaction the broker is an agent of the seller.
AGENCY / REALTORS® DUTY
The seller is the principal and the buyer is the customer. The listing broker is required to deal fairly with all parties to a transaction and to comply with all aspects of the license law; however, the broker is strictly accountable only to the principal, in this case the seller. The customer (in this case) represents himself or herself.
Buyers seeking equal representation in a real estate transaction began to demand more of a broker. In an effort to provide the services that customers/buyers demanded, brokers began to offer a Buyer Agency Agreement. Although required to deal fairly with all parties, the agent is strictly accountable to the principal, in this case the buyer. The seller is represented by the listing broker.
When you wish the services of a real estate professional to represent your interests in the purchase of real estate, you choose Buyer Agency. When entering into a contract for Buyer Agency, the real estate agency owes the client certain duties.
It is important that you feel your interests are represented when entering into a real estate transaction. Choose your agent carefully, and discuss Buyer Agency with your Realtor®. The most recent study by the National Association of Realtors indicated that over 85% of all buyers have a buyer's agent representing them.