What is The Law of Real Estate Agency and How Does it Apply to You?

When I began my real estate career back in 1991, all real estate agents, now called brokers, worked only for the seller. It was a bit odd in those days because as an agent you can spend many hours with a buyer. You grow attached to the buyer, their family and especially their needs and desires in housing. It becomes a goal to fulfill those needs in every way possible. Then the moment comes, they find the house of their dreams and all of a sudden you are on the seller’s side of the transaction and must not take any adverse action against this complete stranger. As a new agent and a recent college graduate in business, I found this to be a backwards way of conducting business but it was the way it was done and the way it had been done for years.

Back in 1991, my then Broker and mentor, Ben Bolender taught me something that I have never forgotten.  He said to me one day, “Always pretend like your client is standing right behind you.  Never say or do anything that you know the client will not like or appreciate.  If you do this you will always be representing your client in the correct manner.”  This is exactly the premise behind the Law of Agency which came into play in 1996 when the State Legislature evened out our real estate practices.

Law of Real Estate Agency Helps to Ensure Clients are Always Put First

Law of Real Estate Agency is a state law that every licensed real estate professional must adhere to.  There are general duties which apply regardless of whom the real estate broker is representing.  In fact, these duties are owed even when a real estate agent is not representing anyone.  The duties are basic, common sense duties; exercise reasonable skill and care, deal honestly and in good faith, present all written offers, disclose any existing material facts known by the broker, account timely for all monies and to provide the pamphlet of the Law of Agency.  Beyond these basic duties, the law then allows the real estate broker to represent the seller, buyer or both within the same transaction which is created by a contractual agreement.  The duties to a buyer and seller are mirror duties but they increase the requirements by including the real estate broker does the following:  Be loyal to the client by taking no adverse or detrimental action to the client’s interest in the transaction, timely disclose any conflicts of interest, advise the client to seek expert advice outside the broker’s expertise, not to disclose any confidential information from or about the client and to make a continuous effort to sell/locate a property for that client.  I find it funny how this directly ties in to the lesson Ben taught me.  I guess Ben was ahead of the times and the State legislature back in the early 90’s.

“Always pretend like your client is standing right behind you.  Never say or do anything that you know the client will not like or appreciate.  If you do this you will always be representing your client in the correct manner.”

Ben Bolender

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At Virgil Adams, our mission statement is, “Our integrity is your security.” I can proudly state that I and all my office colleagues take Agency Law very serious. You can count on us to make sure you get the utmost professional representation in all your real estate transactions. ”

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