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I saw a place on my own yesterday that I actually had seen over the summer (also alone). A broker we have been working with sent us the listing at some point between the two viewings and I would actually like to include him on the transaction. The seller's broker has not asked if we are represented by anyone. Can he refuse to accept our broker in the transaction?
Legally, you can bring in a broker at any time. I am told that the etiquette is usually to let the seller's broker know as soon as possible, but less sure about that.
Do they get paid by the seller?
As long as your broker is a part of REBNY (most of the big brokerages are), the sellers agent is obliged to co-broke (share) the fee to be paid by the seller.
They actually work for the same firm. I am wondering if it will affect our discussions detrimentally.
Full disclosure, I am a real estate agent. In your case where both agents work for the same firm (aks dual agency), your agent would be your designated representative and their fiduciary obligation is to act on your behalf. Ask your agent for a copy of the Agency Disclosure form that describes your rights in any NYC real estate transaction and lays out an broker's responsibility especially when dual agency occurs or go to the department of State's website for a copy. Good luck.
Thanks affrench. I trust out broker. I am more concerned about the seller's agent...
In a perfect world, with dual agency with designated agents, each agent would act as if they work for separate firms. If you have an experienced agent, they will know how to advocate on your behalf and work with the seller's agent.
Since we live in a much less than perfect world, however, will this actually happen?
I am confident (or at least hopeful) that our broker will properly represent us. Afterall, we are bringing him in voluntarily. The part I am more doubtful about is whether the seller's broker will be happy to find out he has to share his fee.
lo888, Why would you care what the sellers broker thinks? remember the seller calls the shots, not his/her broker.
Let's not forget the bigger picture here... The seller's broker would not be working in his client's best interest if the presence of a buyer's broker affects the deal negatively. His job is to sell his client's home. And surely a deal is better than no deal in this market. A deal for the seller's broker will also lead to referrals and more business. You should be fine.
can I come into the deal too? I will only take .5% for doing nothing if that is alright with you.
Although I don't think brokers would like to hear this, I would tread extremely carefully where brokers from the same brokerage are representing both sides of the deal. No matter how they are supposed to act, I haven't seen it work out well in many cases. The temptations are great to share information and sometimes I've seen an office manager in the background either pressuring the brokers or helping them share with or without their knowledge. Sorry, brokers, but I've seen it happen in other states. Can't happen in NY? I guess you'll find out. Good luck.
Check this out:
Be wary of Dual Agency:
NYS Department of State Counsel's Office
Legal Memorandum LI12
BE WARY OF DUAL AGENCY
With the growing number of very large and widespread brokerages, the issue of dual agency arises more frequently than ever before. Any purchaser, seller, lessor or lessee confronted with a dual agency issue by their real estate agent should not take the issue lightly. Parties to a real estate transaction, including real estate brokers and salespersons themselves, seldom realize the inherent problems of a real estate agent acting as a dual agent.
Dual agency arises when a real estate broker or salesperson represents adverse parties (e.g., a buyer and seller) in the same transaction.
Dual agency typically arises in the following way: a real estate broker employs two salespeople, one who works for the buyer as a buyer's agent and the other who works for the seller as a seller's agent. The real estate broker and his salespeople are "one and the same" entity when analyzing whether dual agency exists. As soon as the buyer's agent introduces the buyer to property in which the seller is represented by the seller's agent, dual agency arises.
Dual agency can also arise in a more subtle way: A real estate broker who represents the seller procures a prospective purchaser who needs to sell her property before she is able to buy the seller's property. The prospective purchaser then signs a listing agreement with the real estate broker to sell her property so that she can purchase the seller's property. The real estate broker is now a dual agent representing both parties in a mutually dependent transaction.
When you employ a real estate broker or salesperson as your agent, you are the principal. "The relationship of agent and principal is fiduciary in nature, ‘...founded on trust or confidence reposed by one person in the integrity and fidelity of another.' (citation omitted) Included in the fundamental duties of such a fiduciary are good faith and undivided loyalty, and full and fair disclosure. Such duties are imposed upon real estate licensees by license law, rules and regulations, contract law, the principals of the law of agency, and tort law. (citation omitted) The object of these rigorous standards of performance is to secure fidelity from the agent to the principal and to insure the transaction of the business of the agency to the best advantage of the principal. (citations omitted)." (Emphasis added) DOS v. Moore, 2 DOS 99, p. 7 (1999)
"A real estate broker is strictly limited in his or her ability to act as a dual agent: As a fiduciary, a real estate broker is prohibited from serving as a dual agent representing parties with conflicting interests in the same transaction without the informed consent of the principals. (citations omitted) ‘If dual interests are to be served, the disclosure to be effective must lay bare the truth, without ambiguity or reservation, in all its stark significance.' (citation omitted)
‘Therefore, a real estate agent must prove that prior to undertaking to act either as a dual agent or for an adverse interest, the agent made full and complete disclosure to all parties as a predicate for obtaining the consent of the principals to proceed in the undertaking. Both the rule and the affirmative [defense] of full disclosure are well settled in law.' (citation omitted)" Id. at pp. 9-10.
In a purchaser/seller transaction in which dual agency arises, the agent must not only clearly explain the existence of the dual agency issue and its implications to the parties, the agent must also obtain a written acknowledgment from the prospective purchaser and seller to dual agency. That acknowledgment requires each principal signing the form to confirm that they understand that the dual agent will be working for both the seller and buyer, that they understand that they may engage their own agent to act solely for them, that they understand that they are giving up their right to the agent's undivided loyalty, and that they have carefully considered the possible consequences of a dual agency relationship.
The fiduciary duty of loyalty that your real estate agent owes to you prohibits your agent from advancing any interests adverse to yours or conducting your business to benefit the agent or others.
Significantly, by consenting to dual agency, you are giving up your right to have your agent be loyal to you, since your agent is now also representing your adversary. Once you give up that duty of loyalty, the agent can advance interests adverse to yours. For example, once you agree to dual agency, you may need to be careful about what you say to your agent because, although your agent still cannot breach any confidences, your agent may not use the information you give him or her in a way that advances your interests.
As a principal in a real estate transaction, you should always know that you have the right to be represented by an agent who is loyal only to you throughout the entire transaction. Your agent's fiduciary duties to you need never be compromised.
As the Agency Disclosure form explains, the fiduciary responsibility of undivided loyalty is not guaranteed with dual agency so buyer/seller/tenant/landlord beware. It can be done with both parties faring well in the transaction but go into dual agency with eyes wide open.
In my experience, brokers share information whether or not they work for the same agency. I have seen this firsthand when I sold my place and it is infuriating as hell. Why would they be any more likely to try to screw us in a dual agency scenario?
Is it me, or does the very nature of a buyer's broker commission result in a conflict of interests?
wake up ppls.
Legally, can I bring a buyer's broker last min? Is the seller's broker required to give half the commission to my agent?
Unless you have a contract, you can do whatever you want. So can the seller, for instance, realizing that the economics might change (for instance, the seller might have agreed a deal between him and the seller's broker for 3.5% if no buyers' broker is there to split the commission), the seller could decide to raise the price (e.g. to cover the cost of a now full 6% commission). Or the seller might even take off some square footage from the place so you get a smaller apartment .... ok that's not possible.
What would you do if you brought a buyer to a property representing them as a buyers broker, full disclosures signed and everything, and then you find out they went back with their friend who is a broker just so their friend can get the commission? Do you think the first broker has an rights to this commission?
If the buyer says "this is my broker" than this is their broker. If you don't believe the buyer, call them out and see what happens.
Whether the buyer is lying or telling the truth, the sellers broker doesn't represent the buyer and they have the right (no matter what timing or when in the transaction) to be represented.
The person with the check at the closing table is a pretty important person.
Huntersburg, least important. Money talks and that ends it.