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Legal Benefits to Using a Licensed Real Estate Agent
Legal Benefits to Using a Licensed Real Estate Agent
Whether buying or selling, a professional, licensed real estate agent can provide great benefits in finding a dream home. Legal obligations to clients can provide a safety net for the client. Find out what legal benefits exist to using a licensed real estate agent and how to take advantage of the opportunity.
OLDCAR
The acronym OLDCAR is used to describe legal obligations afforded to clients by licensed real estate agents. The benefits included are listed as follows:
Obedience
If an agent represents an instruction with financial implications, the agent is required to follow it even if disagreement ensues. This pertains to anything that is legal and does not contradict a contractual agreement.
Loyalty
An agent is obliged to put the interest of his or her client above those of anyone else involved in the deal (including the agent). Loyalty gives the client a sense of peace and reassurance the agent has his or her best interests at heart.
Disclosure
If an agent knows any fact that is 'material' to the sale, the agent is obligated to share the information with his or her client. It is more beneficial to the agent to find out as many material facts as possible.
Confidentiality
The agent must protect his or her client's confidentiality. Any information about the client cannot be shared without permission to any other party in the deal.
Accounting
The agent is responsible for keeping track of funds which factor into the deal.
Reasonable Care
An agent must use 'reasonable care' and diligence while handling affairs of the client. This may end up being decided by a judge in court depending on the specific transaction being handled.
The Agent
Fiduciary responsibilities mentioned above only apply to a real estate agent working for the client. This includes having had a written or verbal agreement. An agent may come into the picture who is part of the deal but is not formally representing one's own personal interests. If the agent represents the seller, the obligation exists to the seller not the buyer and legal obligations do not apply to interactions with the buyer.
Every agent has an interest in maintaining good relationships with other agents. Agents can sometimes be too friendly if things get cozy and carelessly disclose information. Over-sharing may involve collusion where two agents work together on the side to structure a deal which benefits both the agents or a hidden outside party which goes above the client's interests. Getting a different agent is always an option if the individual no longer wishes to be represented by the agent or it is believed the behavior is unethical. The other option is to turn the agent into the company for illegal practices.