[Bg2] NUMBER ONE Success System

[Tommy Lee]

http://www.noss123.com/


   - *Agency relationship*: Traditionally, the broker provides a
   conventional full-service, commission-based brokerage relationship under a
   signed listing agreement with a seller or "buyer representation" agreement
   with a buyer, thus creating under common law in most states an agency
   relationship with fiduciary obligations. The seller or buyer is then a
   client of the broker. Some states also have statutes which define and
   control the nature of the representation.

Agency relationships in residential real estate transactions involve the
legal representation by a real estate broker (on behalf of a real estate
company) of the principal, whether that person or persons is a buyer or a
seller. The broker (and his/her licensed real estate agents) then becomes
the agent of the principal.

   - *Non-agency relationship*: where no written agreement nor fiduciary
   relationship exists, a real estate broker (and his agents) works with a
   principal who is then known as the broker's customer. When a buyer, who has
   not entered into a Buyer Agency agreement with the broker and buys a
   property, then that broker functions as the sub-agent of the seller's
   broker. When a seller chooses to work with a transaction broker, there is no
   agency relationship created.

  Transaction brokers

Some state Real Estate Commissions, notably Florida's [4] after 1992 (and
extended in 2003) and Colorado's [5] after 1994 (with changes in 2003),
created the option of having no agency nor fiduciary relationship between
brokers and sellers or buyers. The transaction broker assists buyers,
sellers, or both during the transaction without representing the interests
of either party. They may be then regarded as customers.

As noted by the South Broward Board of Realtors, Inc. in a letter to State
of Florida legislative committees [6]:
"The Transaction Broker crafts a transaction by bringing a willing buyer and
a willing seller together and assists with the closing of details. The
Transaction Broker is not a fiduciary of any party, but must abide by law as
well as professional and ethical standards." (such as NAR Code of Ethics)

The result was that in 2003, Florida created a system where the default
brokerage relationship had "all licensees …operating as transaction brokers,
unless a single agent or no brokerage relationship is established, in
writing, with the customer" [7] and the statute required written disclosure
of the transaction brokerage relationship to the buyer or seller customer
only through July 1, 2008.

In both Florida and Colorado's case, dual agency and sub-agency (where both
listing and selling agents represented the seller) no longer exist.
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