4.2 Agency Positions and Disclosure

The Buyer will write out TWO checks:

1)Earnest money 2)Options fee >As a client's agent our responsible to be accountable of those funds in a Fiduciary manor **Maintained Separate = Illegal to put in your account.**

D.Disclosure{Continued} As a Listing Agent or a Agent for the Seller.What are we obligated to disclose to the seller?

1)Our opinion of the Market Price Property- It is our obligation to let the Seller know their price is not supported by the market. 2)Offers- ** Unless the Seller has in writing do not show** 3)The identity of our perspective purchases.(Including any relationships w/them). -The Offer is coming from.... 4)The ability of a Purchaser to complete the sale of offer a higher Price. 5)Any interest a Broker has in a Buyer. 6)House Flipping. 7)Days on the Market or how long a property has been listed. >Plays it safe and always tell them.

What happens during the Fiduciary Relationship? (Broker Oweing the Principle).

5 Common Law of agent Responsibilities and Duties owed to the Principle.(Client).

O.Obedience

>A Broker is obligated to act in good faith and obeying clients instructions. >You may be asked to engage in unethical activities .Reply........ "I Don't Believe this is ethical approach, I would like to find a better way to handle this."

Agents L.Loyalty to the Principle.

>Always place the clients interest first.Above ourselves, our brokerages ,other with whom we might deal. >Cannot Disclose confidential information: -Principle Financial Situation -Pricing -Cause Harm to bargainer >If I am Rep. a Seller and someone else is Rep. a Buyer and I learn information that can give my Sellers advantage I am obligated to tell my client .

C. Care

>As an agent a Broker must exercise a reasonable degree of care while handling business of the principle. >The Broker is liable to the Principle for any lost resulting for the Brokers negligence or carelessness.

L.Loyalty

>Broker owes the principle. >Principle owes the agent. >Agents loyalty to the Principle

D.Disclosure

>Brokers owes the client their full fair and timely disclosure of all known facts of a transaction. a) We have to keep our clients fully informed of ALL FACTS AND ALL INFO. That we obtained that can affect our clients decisions. b)A Broker can be held liable for damages if failed to disclose that information.

If the agents represents the Seller C.Care would include helping the Seller:

>Setting a realistic Listing Price. >Efforts put forth to Marketing the Property. >Helping the Seller evaluate terms and conditions of any offers. >Helping the Buyer find a property suitable for their needs. >to sort out financial services. >Type of Financial Conventional (FHAVA). >Explain and assist with offers and counter-offers to keep Buyers interest in mind.

A.Accounting

>The Broker must be able to report and account for all funds recieved from or behave of the Principle .**HAVE TO GIVE ACCURANT COPIES OF ALL DOCUMENTS TO ALL PARTIES** >The License ,Law and Rules requires the Brokers handle all funds entrusted to them in a specific way. >If it cannot be deposited or co-mingled into agents own funds it has to be kept in a special trust or esrcow account.

The Buyers Intention to resale for profit.

>The Purchaser who initiated the flip is looking to buy a prop. below Market Value. >As that Seller is our client we have to tell them that the purchases believe it should be sold below Market Value. >BUYERS SIDE: If you're the agent for the buyer. >Has to inform the Buyer of any blatant deficiency .(Anything obvious noticed.) >Inform about the Prop. that maybe has sale provisions, financing provision or other things that do not work for our Buyer.

What happens during the Fiduciary Relationship? (Agents responsibility)

>a Fiduciary as a (and the) role of an Broker as the agentt of the principle is that of a FIduciary relationsibilities to their Principle. -One in which the agent is in position of in trust and confidence. >Is normally in charge of the money of the property or another.

Complete the Sale:

A Mortgage qualification letter comes in. As a listing agent you should all offers contain this letter. Stating the Buyers ability qualify for a loan.

A.Accounting{Examples}

A Purchasers wishes to buy a home. We are representing the buyer under a Buyer Rep. Agreement, which means they are your client. The Buyer signs a contract/ offer of purchase.

Fiduciary

A person in a position of trust and confidence , as between Principal and Broker; Broker as Fiduciary that owes certain loyalty which cannot be breached under the rules of agency.

*Pop Quiz* A Buyer's earnest money should be deposited in which of the following?

An Escrow account.

*Pop Quiz* The Fiduciary duty of care when representing a Buyer includes which of the following services...?

Assisting with counter offers.

5 Common Law of agent Responsibilities and Duties

C.O.A.L.D

*Pop Quiz* The 'c' in the acronym C.O.A.L.D. stands for which Fiduciary duty?

Care

*Pop Quiz* A Seller's Broker is required to tell their client any relationship they may have

Disclosure

*Pop Quiz* A Broker must inform their clients of all known facts related to a transaction.

Disclosure.

O.Obedience {Examples} Some Sellers may discriminate and may not wish to sale to certain groups.

It is a agents responsibility that the property is shown to everyone.

*Pop Quiz* A Broker must always place his/her client's interest above their own . This is an exapmly of what Fiduciary duty....?

Loyalty

Fiduciary=

Position of Trust & Confidence

Offers a Higher Price:

Show Seller the Mortgage Letter to show that the Buyer has the ability to offer a higher price.

*Pop Quiz* A Broker as a Fiduciary owes certain loyalty, which cannot be breached under the rules of agency

True