If you're getting set to start your search for a home to purchase or lease it is imparative that you fully understand what a Buyer Representation agreement is and what benefits it has to you.
Most people may think of the words “client” and “customer” as being interchangeable terms however that is not the case. The terms clients and customers have a strategic, operational, legal and philosophical difference between their meanings.
A “customer” is a buyer who is receiving no representation from the agent that is facilitating the home purchase for the seller. A “client” receives a “fiduciary” duty of care from their agent. In other words the buyer’s Realtor® is responsible for putting the interests of the buyer FIRST. This is agreed to in writing and provides the buyer with a tangible contract stating the duties of care owed to them.
Realtors® have the following responsibilities to customers:
Honesty: As a customer, the Realtor® shall not make a statement or action that can result in fraud or misrepresentation. All laws and regulations pertaining to the transaction must be obeyed including the disclosure of material facts. Every individual is owed honesty.
Accounting: As a customer, the Realtor® is required to promptly report to the customer monies or property received and paid out. Upon request, they must provide an accounting of these actions. This duty also requires the Realtor ® to safeguard monies and property held on behalf of the customer.
Component service: As a customer, the Realtor® provides services that should conform to the standards of practice and competence that are reasonably expected in the specific real estate disciplines in which they engage. In other words, as a customer, the Realtor® should not try to provide specialized professional services concerning a type of property or service that is outside their field of competence.
Agency and material fact disclosures: As a customer, the Realtor® must disclose agency relationships including an explanation of the difference between a customer and client relationship at the earliest opportunity. This is to ensure that the customer can protect their own interests such as not revealing confidential information. Material facts about properties must be disclosed.
Realtors® have the following responsibilities to clients:
Obedience: Your Realtor ® must follow all reasonable and lawful instructions but not exceed the scope of authority conferred by the client. That is, do not make decisions of the client.
Undivided loyalty: Your Realtor ® is prohibited from advancing any interests adverse to the client’s interest or conducting the client’s business in such as way as to benefit a customer, the representative or any other party to the detriment of the client’s interest.
Full disclosure: Your Realtor ® is required to disclose affirmatively and honestly all information concerning the transaction and property that might affect the clients decisions at the earliest opportunity. The Canadian Real Estate Association (CREA) Code of Ethics defines earliest opportunity as the time before the Realtor® provides professional services that go above providing information as a result of incidental contact by a customer.
Confidentiality: Your Realtor ® is prohibited from communicating your confidential information both during and after completion of your transaction. Confidential information must be kept confidential unless you decide to release your Realtor ®. However, the material facts about defects of a property are not confidential
Accounting: Your Realtor ® is required to promptly report to you all monies and properties received and paid out. Upon request, they must give an account of these actions. This duty also requires the Realtor ® to safeguard monies and property held on behalf of the client.
Skilled and Conscientious Service: Your Realtor ® is required to protect you from foreseeable risks or harms and recommend that you obtain professional advice or assistance when you are outside the scope of the Realtors ®.
The responsibilities owed to the customer may sound impressive and may meet your needs. However, in comparison to those of a client it is evident that there is not only a legal responsibility owed to a client however the value-added offerings bestowed on a client clearly supersede those of the customer. In a client relationship your Realtor ® will have your interests at heart and not . As a client you are advised, educated and work towards a purchase strategy whereas as a customer the seller is protected, you are informed of only the facts and their is no strategic purchasing consultation.
At the end of the day ask yourself the following question, “How do you want to be cared for in one of the most significant financial transactions in your life?”
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Century 21 Miller Real Estate Ltd Brokerage
467 Speers Road, Oakville, Ontario L6K 3S4
Oakville Real Estate – CENTURY 21 Miller –TOP TEN Office*
*For CENTURY 21 Canada in 2010 and 2011, Based on Gross Closed Commission