The Elegant Augusta Real Estate Blog

Lydia Taylor May 22nd, 2007

My husband Austin was reading a post I made last week that mentioned the client/customer relationship with a Realtor. He commented that he did not realize that there was such a big difference between the two. The husband of a Realtor - and a buyer of two homes - was not clear on agency relationships! I was struck by that… If my husband did not realize the difference, then there are many more people in the general public that are unsure about the customer/client relationship aspect of real estate.

Real Estate Agents are required by law to explain agent relationships to you, but many avoid discussing it or explain the relationship poorly. I want you to be informed before you enter the market to buy or sell a home, so I am going to give you the ‘non legalese’ jargon rundown on South Carolina’s and Georgia’s agency relationships.

The Customer Relationship

The first contact that you make with a real estate company or agent makes you a customer. You are a customer until you sign a buyer brokerage or listing agreement. When working with you as a customer, by law, licensees are required to perform 5 basic duties of customer service. Those duties are:

1. Presenting all offers in a timely manner;
2. Accounting for money (earnest money checks etc.);
3. Letting you know exactly what they will and will not do for you;
4. Being honest when giving you information;
5. Letting you know about any “adverse material facts.”

Adverse material facts translates out to be anything bad about the property (for example the roof leaks) or anything going bad with the deal (such as the seller refuses to move).

Other than those 5 things, as a customer you are guaranteed nothing else! Your agent is merely a chauffer and conduit. Any information you provide, whether it be for bargaining or personal, is not confidential and may be used to help whoever is on the other side of the transaction.

I strongly urge you not to work with a Realtor in a customer relationship. I know there is a fear of ending up stuck in a binding agreement with an agent that you have a personality conflict with. There are a couple of ways to avoid that situation. Firstly, spend time talking with the agent. Most of the time you know within the first 5 minutes whether or not you want to work with this person. Secondly, don’t enter into an extended agreement with them at first. Agree to a shorter term agreement - and if you are pleased with their performance - then agree to enter into a longer term agreement.

The Client Relationship

Once you have signed the buyer brokerage or listing agreement and have become a client, the list of responsibilities that an agent is to provide to you expands to an OLD CAR.

Obedience
Loyalty
Disclosure
Confidentiality
Accounting
Reasonable care and skill

As a client, you are also entitled to advice and assistance in the negotiation process. Basically, as a client your real estate agent is required, by law, to provide you good and loyal service. The other key is Confidentiality. No water cooler talk, no phoning a ‘buddy agent’, no funny business. Their Real Estate License is at stake, so if they value their livelihood, they will honor your privacy.

As a ‘real estate customer’ you are not entitled to loyalty or confidentiality, so is it really worth being anything less than a client? I don’t think so.

Protect your investment- if you use a real estate agent, make sure you work with them under the client relationship. If you don’t understand something about that relationship- ask! They are required by law to explain it to you. Any agent should be able to discuss this topic with ease. If they can’t explain agency to you, find another agent.

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