Buyer Brokerage Compliance
Commonly referred to as buyer’s agents, a buyer brokerage is a relatively new invention in the history of real estate agents and transactions. Traditionally, real estate agents, who engage in the marketing and selling of real estate in exchange for a fee, worked for the seller by default. The exclusivity of the real estate agent/seller relationship was rooted in the common law principles of agency — an agent is bound to promote and protect the best interests of his customer, in this case the seller.
In the 1990’s, a new agency relationship became more common between the formerly unrepresented real estate buyers and the agents who worked exclusively for buyers. Buyer brokerages can be exclusive and only represent buyers, or may be a full service agency with agents available to represent either buyers or sellers.
Most states have now added laws governing buyer brokerages and dual agencies to existing bodies of law governing real estate agencies and transactions. Pennsylvania is no exception, and the Real Estate Licensing and Registration Act (RELRA) requires real estate agents to give consumers a notice concerning agency relationships at the initial interview. A portion of the notice states:
Buyer Agent
As a buyer agent, the licensee and the licensee’s company work exclusively for the buyer/tenant even if paid by the seller/landlord. The buyer agent must act in the buyer/tenant’s best interest, including making a continuous and good faith effort to find a property for the buyer/tenant, except while the buyer is subject to an existing contract, and must keep all confidential information, other than known material defects about the property, confidential.
The notice also defines Seller Agent, Dual Agent, and Designated Agent, and further advises consumers of various relationships and duties that may come into play in their real estate transactions.
For more information about buyer brokerage compliance, contact a professional real estate attorney. At Scolieri Law Group, P.C., our lawyers have represented commercial and residential brokers, agents, mortgage bankers, landlords, tenants, buyers and sellers. We have the experience to assist you in all your real estate law needs. Contact us today at (412)765-0546 or info@scolierilaw.com.