IC 25-34.1-10-11 Licensee representing the buyer or tenant; obligations; Disclosure of information § 11. (a) A licensee who represents a buyer or tenant has the following obligations and obligations: (1) Fulfill the conditions of the agency relationship concluded with the buyer or tenant. (2) Disclose, redefine and disclose the nature of the agency relationship with the buyer or tenant if the relationship changes. Some states allow verbal agreements, but most do not. You may have noticed that I was referring interchangeably to your future role as a real estate salesperson and real estate agent. For the purposes of a license, your official title is Real Estate Seller. However, you will be an agent. And while it`s common in the real estate industry to use the term “agent” to distinguish it from brokers, the fact is that brokers are also agents. In this lesson, we`ll take a closer look at what exactly it means to be an agent. There are many careers in which people must act on behalf of another person, government or corporation. There are even legal situations where a person must act as an agent for a family member. So, as you can imagine, there are many types of agents and many ways in which this role can be fulfilled.
In this lesson, we will discuss all types of agents as well as the different permutations in which a real estate seller or broker can fulfill their specific role as an agent. F. Nothing in this Chapter or in Chapter 17 of Title 37 shall be construed as requiring the Disclosure by the Agency of a lease that does not exceed a period of three years and that does not contemplate the sale of the property in question to the lessee. F. For each transaction, a licensee may, without liability, withdraw from the representation of a client who has not consented to a disclosed dual agency. The withdrawal does not affect the Licensee`s ability to continue to represent the other customer in the transaction or prevent the Licensee from representing the Customer in other transactions. A good salesperson will always be useful and truthful when working with customers, and while they should never forget that they represent their customer, it can be easy for the customer to realize that the seller doesn`t put their needs first. Depending on the state in which you practice, there may be laws that state that you must disclose in writing who the customer is and where your loyalty lies.
Even in states that do not require it, there are agencies that choose to use signed forms so that the client understands that there is no agency relationship that makes them a client. As we have already mentioned, an agency relationship can be built on the basis of the involvement and written assurance that the client understands that he does not have the advantage of this relationship; This can be a protection in case of prosecution. It should also be noted that some States allow a dual agency where only one person is authorized to serve the interests of a buyer and seller. Disclosures made in accordance with the disclosure requirements for agency relationships set out in this chapter are sufficient to comply with the disclosure requirements of the common law. I. Retain confidential information learned during a previous relationship with an organization, unless disclosure is made with the consent of the former client or is required by law; It is also possible to establish an agency relationship with the actions of the parties. This is called an implicit agency. If a real estate agent takes on responsibilities that are usually those of a broker but has not signed an agency contract, he can still be considered an agent through an implied agency. For the same reason, if the client asks the agent for advice or actions that are usually in the agency, then an implicit agency could be created. In real estate, what the broker earns capital is called a commission.
Another meaning of commission is to get a responsibility assigned by someone else, which is essentially the nature of the agency relationship, but when you hear the term commission in real estate, you can rely on it to refer to the agent`s compensation. The Tenant will not be liable for any other obligations or obligations after the termination, expiration or termination of the Agency Relationship, except: (1) taking into account all funds and items received during the Agency Relationship; and (2) treat as confidential all information received during the Agency Relationship that has been treated confidentially at the Request or instruction of The Client, unless: (A) disclosure is required by law; (B) the customer agrees to the transfer in writing; or (C) the information becomes public from a source other than Licensee or through subsequent words or customer conduct. Added by P.L.128-1994, SEC.6. Amended by P.L.130-1999, SEC.19. (10) `dual agency` means an agency relationship in which a licensee cooperates with both the buyer and the seller or with the owner and tenant in the same transaction. However, such a relationship does not constitute double mediation if the licensee is the seller of the property he owns or if the property belongs to a real estate company whose sole owner and intermediary is the licensee. A dual agency relationship should not be interpreted as existing in a circumstance in which the licensee cooperates with both the landlord and the tenant in relation to a tenancy agreement that does not exceed a period of three years and the licensee is the lessor. Some state real estate commissions have included useful documents on their websites for disclosure by authorities. Some examples: An agency relationship in which the agent acts for both clients in a transaction at the same time. To better understand the legal issues related to agency and disclosure, we`ve rounded up a number of recent legal cases that you can investigate.
In states where dual agency is legal, dual agency must be disclosed in writing. The disclosed dual agency is what allows a single agent to represent two competing clients while fulfilling its fiduciary responsibilities. In most cases, disclosure requires both principals to give their written consent for the broker to represent both principals, ensuring that both principals are fully aware of the agreement. In order for dual agency to be practiced responsibly, a broker often assigns two different sub-agents in the office to each client. The sub-agent assigned to the seller treats them as if they were the only customer, while the sub-agent assigned to the buyer treats the buyer in the same way. These sub-agents are called designated officers. According to a 2019 report released by the Consumer Federation of America, more than half of home buyers and sellers in America are unaware that there are different types of agencies for real estate agents. Dual agency is regulated by law and illegal in some states, but often boils down to what the home buyer or seller is comfortable with after the real estate agent has disclosed their type of agency. A real estate agent or seller works as a special agent, which is the most common type of agent for a real estate seller or broker. A special representative is a person who has only limited authority to act on behalf of the procuring entity.
A special real estate agent only has the right to act on behalf of the principal if he or she carries out very specific business transactions, and these will most likely all be clearly stated in a registration contract signed by the agent and the client. For example, most listing contracts allow the special agent to advertise the property. All transactions that a special agent can carry out on behalf of his client must be specified in the contract that initiates the official commercial transaction between a real estate agent and his client. Laws and regulations governing disclosure by agencies may vary from state to state. As a member of the National Association of REALTORS®, you may contact your State Association of REALTORS for specific information about your state`s® disclosure requirements. The National Association of REALTORS collects information on country-specific legal issues in the State Issues Tracker: When setting up an express agency, two main documents are used: list contracts and buyer representation agreements®. Although we will discuss them in more detail in a later lesson, now let`s look at how they are used to establish an express agency.