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2. Creating an Agency Relationship

2. Creating an Agency Relationship. In this chapter How relationships are formed Agency disclosure How we work with buyers Advantages of buyer representation Buyer representation agreement issues. 25. Express Agreements. Written agreements Listing agreement

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2. Creating an Agency Relationship

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  1. 2. Creating an Agency Relationship • In this chapter • How relationships are formed • Agency disclosure • How we work with buyers • Advantages of buyer representation • Buyer representation agreement issues 25

  2. Express Agreements • Written agreements • Listing agreement • Buyer representation agreement • Tenant representation agreement • Property management agreement • Right-to-lease agreement 25

  3. Oral Agreements • Verbal agreement to represent a buyer • Accepting a listing broker’s offer of subagency • Open listing 25

  4. Implied Agreements • Accidental • Occurs when a licensee talked and/or acted like an agent and the consumer relied on the action • Usually results in a conflict 25

  5. NAR's Policy on Agency Disclosure • Timely • Meaningful • Written 28

  6. Timely • Before any contract or agreement is signed • Before substantive discussion 28

  7. Meaningful • Disclose all legal forms of relationships • Consumer can make informed consent 29

  8. Written Put it in writing! 30

  9. How We Work With Buyers 32

  10. Advantages for the Buyer • Assertive advocate • More information about the property • Can work with a FSBO • Access to market experts • Savvy negotiator 35

  11. Advantages for the Seller • No liability for deeds of buyer’s rep • Reduced chance seller’s agent will divulge confidential information • Motivated, qualified buyers • Extended market reach for faster sale 35

  12. Advantages for the Buyer’s Rep • Can share information freely • Greater buyer loyalty • Better relationship with buyer-client 35

  13. Advantages for a FSBO • Buyer’s rep can handle the details • No cost if buyer compensates agent, or • Likely less than full commission to a listing broker (resolve compensation issues before property showing) 36

  14. Exclusivity Purpose Duration Compensation Services Buyer Representation Issues 37

  15. When Relationships Change • Client and customer must both provide informed consent • Both must agree how you will handle the confidential information • Interpersonal dimension 38

  16. Compensation • Compensation does not determine an agency relationship • All parties must understand who represents whom and how fees will be paid • All representatives’ statements and actions must be consistent with their agency relationships 40

  17. Building Blocks • How would you explain the advantages of exclusive buyer agency? • How would you explain the importance of defining purpose, duration, and scope of work? 42

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