Real Estate Agency Relationships in PA - The Basics - Lancaster PA Real Estate Video Blog

Today I talk about the "basics" of how a real estate agent can work with the public in the state of Pennsylvania (mostly similar to other states as far as I understand it). Since we're talking about either home buyers or home sellers, the relationship of the real estate pro to the client can't be too hard to figure out, right? Well, almost.

1) Listing Agents (or Seller Agents) - have a written "listing agreement" that empowers them to represent the owner of a property complete with "fiduciary responsibility" to tell the seller anything they know that would be of material importance.

2) Buyer Agents (or Selling Agents - note the possible confusion in terms) - have a written "buyer agency" agreement with a home buyer that empowers the agent to represent the buyer to various agents and miscellaneous parties. Has a fiduciary responsibility to the buyer to protect their confidentiality.

If a buyer does not have a written agreement in place with their agent showing them homes, they should not be disclosing sensitive information to that agent since the law seems to indicate that that agent would be compelled to disclose what they know to the seller should the seller (or listing agent) want to know about the prospective buyer's financial situation, etc. So get that buyers agency signed ASAP if you're a buyer!

3) Dual Agent - represents both parties through separate agreements with each. I do not understand why anyone would consent to letting an agent do this to them, although it is legal in PA. It makes no sense - how does an agent truly best represent both a buyer and seller at the same time? Run away...

Dual Agency shouldn't be confused with the situation where a listing agent "works with" a member of the public while remaining loyal to the seller. This happens all the time in new construction sales - the person waiting for you in the model home represents the builder and ONLY the builder. Even so, people continue to go into models without proper representation of their interests every day...bad idea in my opinion.

4) Transaction licensee - where the agent represents NO ONE but writes up a sales transaction at the request of parties. This is not usually a good option either because there is always the assumption of liability on everybody's part. IMO it's best to just hire your own representative and be done with it, even if you're buying your mom's house... It's what you don't know that will...you get the idea.

There are lot more nuances that your agent can explain as you go, but these are the basics. Remember, always get it in writing! If you have any questions feel free to email me at jeff@yourlancasterhome.com.

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