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Let's review the basics. With single agency, the more common transaction, one broker (a real estate company) represents the buyer while another broker represents the seller. In the case of dual agency, one agent, a dual agent, represents both the buyer and the seller. Dual agency also occurs when a broker designates two agents to work a single transaction. Each "designated agent" represents a client-either the buyer or the seller. This arrangement is primarily used by companies with multiple offices. While dual agency is legal in most states, state laws vary, and full disclosure is required. All parties must agree to it in writing.
Before consenting to dual agency, consider these points:
· A dual agent acts as a buyer's agent to the buyer and as a listing agent to the seller. Typically, a buyer's agent would gather and convey pertinent information to the buyer regarding the seller and the property. And he or she would be obligated to negotiate the best price and terms for the buyer. Likewise, a listing agent would work to arrive at the most favorable deal for the seller. As the seller's advocate, the listing agent would not be obligated to divulge information to the buyer other than material facts about the property.
You decide: Can a dual agent fulfill his or her obligations, particularly to the buyer, given the inherent conflict of interest? If a dual agent withholds information from the buyer, is it possible for him or her to faithfully advocate for the buyer? What happens when a designated agent accidentally sees or hears valuable information because he or she works in the same vicinity as the other designated agent?
· A buyer's agent is a trusted advisor as well as a skilled negotiator. Experienced negotiators develop and implement a negotiating strategy and look for opportunities to bargain.
You decide: Will a dual agent emphasize negatives about the house or the deal, and suggest contingencies to protect you? On the other hand, could it be that familiarity with both sides might enable a dual agent to negotiate a deal more quickly than if two agents were involved?
· In some areas, buyers and sellers must conduct negotiations on their own behalf. Dual agents are not allowed to suggest a price the buyer should offer or a price the seller should counter with or accept.
You decide: Would you be comfortable negotiating a deal this size without advice from your real estate professional?
Some people feel very comfortable working with a dual agent. However, if you're not one of them, you do have options: Ask the agent to choose whom he or she will represent, consider working with a designated agent, or hire a buyer's agent with another brokerage. Whichever you choose, you need to feel confident that your interests are well represented.
"Real Service in Real Estate." For a personal consultation on buying or selling real estate, Janis Peterson, GRI, CSP Realtor® can be reached at (610) 642-3744, e-mail: jp4re@pahomes.com. Prudential Fox & Roach Realtors® is an independently owned and operated member of The Prudential Real Estate Affiliates, Inc.