Real Talk!

Lately, I’ve had a number of people squirm over “Multiple Representation”… I think it’s just the fact that it’s jargon and obviously has some legal ramifications…

but it’s something really important that every Buyer and Seller needs to know.

It is your Realtor’s ® duty to speak to you, at the earliest possible convenience, about Agency Representation.

As a Seller, when you list your home, Agency should be clearly explained... read the Agreement you sign, ask questions... feel comfortable!

As a Buyer, you are wise to have a Realtor ® representing you in the acquisition of property.

As a Buyer, you will likely be shown a pamphlet entitled “Working with a Realtor ®” and asked to sign a simple “acknowledgment”, verifying that Agency Representation has been discussed. Most Buyers will be asked to sign a contract, called a Buyer Representation Agreement.

The Buyer Representation Agreement details the responsibilities of the Realtor ® and provides information about what is required from the Buyer- and, as with any contract, this Agreement has a specific time limit.

This is nothing new-

however, while this practice has been around for close to 7 years, it isn’t everyday that someone buys or sells property and for the average person it seems to be a very confusing thing. It’s a shame, to see how often people are frightened when a Realtor ® starts talking about Agency.

The regulations are clear, this is a MUST and it is in the interest of protecting the consumer, yet it is still met with suspicion.

I know, it’s human nature, to fear the unknown… but it is upsetting to us professional Realtors ® to think that the consumer meets our diligence with doubt. You see, in our minds, it’s the Realtors ® who don’t talk about Agency that are the ones you need to be concerned about.

A Realtor ® who starts talking to you about Agency, rather than the nice railing on the front porch of the house you pointed at in the window, is doing their job according to the law. We try to be polite and courteous and friendly, but we really need to follow the law. And, don’t you think that is something you would expect, at the very minimum from your Realtor ®?

The really spooky part, for most folks, seems to be when a Realtor talks about how they might be in Single Representation, but it could change to Multiple Representation…. Huh???

As with all other laws, you almost have to be a Philadelphia Lawyer* to really understand it… but let me try…

Once in a while, a Realtor ® has a contract with a Seller (by way of a listing agreement) and a contract with a Buyer (by way of Buyer Representation Agreement). If a Realtor’s® Buyer Client wishes to see or to make an Offer on any property listed with the company their Realtor ® works for (known as the Brokerage), this means that the Realtor ® is working in a Multiple Representation relationship.

In the past, this type of representation has been called “Dual Agency” and some other terms, but the Real Estate Council of Ontario has been diligently working at making all of the words and terms easier to understand.

With each “Offer” (actually called an “Agreement of Purchase and Sale”), Realtors ® are required to prepare a “Confirmation of Co-Operation and Representation”. This form will clarify which Brokerage (Real Estate Company) is working for the Buyer and which is for working for the Seller and also, who is paying the commission.

In the event that the same Brokerage (Real Estate Company) has a Listing agreement and a Buyer Representation Agreement with parties interested in the same property, the Confirmation of Co-Operation and Representation” will say:

“The Listing Brokerage has entered into a Buyer Representation Agreement with the Buyer and represents the interest s of the Seller and the Buyer with their consent, for this transaction. This Listing Broker has a duty of full disclosure to both the Seller and the Buyer, including their requirement to disclose all factual information about the property known to the Listing Brokerage.

However, the Listing Brokerage shall not disclose:

- That the Seller may or will accept less than the listed price, unless otherwise instructed in writing by the Seller
- That the Buyer may or will pay more than the offered price, unless otherwise instructed in wiring by the Buyer
- The motivation of or personal information about the Seller or Buyer unless otherwise instructed in writing by the party to which the information applies, or unless failure to disclose would constitute fraudulent, unlawful or unethical practice
- The price the Buyer should offer or the price the Seller should accept
- And, the Listing Brokerage shall not disclose to the Buyer the terms of any other offer.

However, it is understood that factual market information about comparable properties and information known to the Listing Brokerage concerning potential uses for the property will be disclosed to both Seller and Buyer to assist them to come to their own conclusions.”

How much better can it get? In Multiple Representation, the Realtor ® has the same fiduciary responsibility to both parties. In Multiple Representation, both parties are given factual information that they may use to make an informed decision.

I don’t believe it really happens any other way. A Seller usually knows what price they will or will not accept and a Buyer usually knows how much they will or will not pay.

If everyone is being honest about the state of the property and its components (like the furnace or the well) and if the offer is negotiated properly, each party is given sufficient comfort to proceed.

You gotta like it.

·note: Philadelphia Lawyer is an expression that dates back to the 1700s due to the outstanding reputation of the Philadelphia bar during colonial times. It was generally meant as a compliment to the legal expertise and competence of a lawyer. In recent years the meaning has changed slightly. According to “answers.com” it means: A shrewd attorney adept at the discovery and manipulation of legal technicalities.