Who Is My Client?

A Realtors Guide to Compliance with the Law of Agency

Part 1 of 7

Understanding Real Estate Agency

You are about to enter the often confusing world of “real estate agency”. In truth, almost as many real estate agents are as confused about “agency” as buyers and sellers. Worse yet, many agents, buyers, and sellers take the attitude that agency doesn’t matter and that all buyers want to do is buy and all sellers want to do is sell, so please don’t confuse me with all this agency stuff.

Well, if you really want to have your interests protected when you buy your next home, you had better take a little time to become more knowledgeable about agency. If you don’t, you may very well end up, unknowingly, in the wrong type of relationship with a real estate licensee and pay too much for a home...buy the wrong home...get the wrong financing, or perhaps end up with unexpected repairs and/or other surprises.

In November, 1986, the National Association of Realtors® published a booklet titled: “Who Is My Client? - A Realtors® Guide to Compliance with the Law of Agency”. This guide still stands today as one of the most comprehensive and accurate sources of information concerning the common law of agency as it applies to real estate. Our discussion of agency will begin with quotes from this guide. The following discussion is detailed and involved and you probably won’t read or hear about any of these important matters anywhere else. But...if you really want an understanding of how to protect your interests in a real estate transaction, you need to take the time to read and understand this material.

From the PREFACE: “The legal concept of “Agency” with which this booklet is concerned is beyond question the most fundamental of all the legal concepts applicable to the real estate profession and professional. It is the very nature and function of the real estate broker, appraiser and manager to be an agent. The law of agency literally defines the “species” and gives real estate practitioners their identity.”

(Continue To Part 2 of 7)