One of the first forms you are going to see when you start working with a real estate agent is what we as real estate agents call the Blue Brochure. This is the Agency Disclosure Brochure. It is a disclosure form that is meant to explain to you who is working for you and who is not. Client or Customer is pretty confusing if you ask me.
Be sure to check out this video from the Idaho Real Estate Commission to learn more about Agency. Also, here is some additional consumer information from the Idaho Real Estate Commission.
If you are a client, meaning you have signed either a Buyer’s Representation Agreement or a Seller’s Representation Agreement, then you are owed a whole batch of extra care.
If you have not, then you are somewhat freewheeling out there in the land of what you say can be used against you if the opportunity arose.
If you are a Customer, a real estate licensee is not required to promote your best interests or keep your bargaining information confidential. If you use the services of a licensee and brokerage without a written Representation (Agency) Agreement, you will remain a Customer throughout the transaction.
Seller Example: Let’s say you interview 5 Real Estate agents to list your home for sale. You tell all 5 of them that you want to ask $500k for the property but you would be willing to take $450k if someone came in with an all-cash offer. Of those 5 agents that you told this to, the only one who cannot tell a potential buyer that you are willing to take $450k for the property is actually the one you hired and filled out the listing agreement with. The other 4 real estate agents can disclose your secret to any potential buyer that they may have.
Buyer Example: You walk through 5 open houses and you tell the Real Estate agent in each one of them that even though the house is $500k you could go to $600k on any house if you liked it well enough. You end up hiring an agent to represent you and you decide that you want to make an offer on one of the houses that you walked through. But you want to start lower than the asking price. The agent in those homes knows that you can go above the asking price if you want the house so they don’t need to negotiate as hard with you because they already know you are willing to go higher.
Be sure to take the time to read this document and be sure to ask questions if you don’t understand what it’s saying.
Because what you say matters and you want to be sure that you are protecting your interests. Of course, the real estate agent that you hire is going to help protect your interests but, prior to the hire, you want to be sure that you are protecting yourself.
Also, pay close attention to the Audio/Video Surveillance section of this document. It has a very good warning.
If you have any questions about Agency or the real estate process, feel free to contact us anytime. We are happy to help you out with any questions you may have.
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