January 10th, 2014
In today’s blog, we’re not going to talk about spies and intriguing espionage, sorry. A dual-agent is a real estate agent that represents both the buyer and the seller during the sale of a property.
You might initially think this is a great idea since you won’t have to wait as long during negotiations, and there will be fewer miscommunications with fewer people.
However, it can be fraught with perils and is not recommended for first time home buyers or sellers. You need to know clearly the process and the pitfalls before you put that much trust in one person.
Real estate agents have an almost attorney-like role where they are supposed to protect and represent the rights and interests of their clients while advocating during the negotiation of the final offer and closing costs.
So having one dual agent could have a conflict of interest especially on behalf of the buyer if the agent is focused on getting the sale. The agent will know the intimate details such as the highest price the buyer could go and the lowest price the seller is willing to take. Additionally, a dual-agent could ask for the commissions for both the seller and the buyer.
Know that this is negotiable, and that perhaps you don’t want to share all of your information with the agent going in. You will need to be your own advocate. For an experienced buyer or seller, this may be acceptable.
There’s actually a second type of dual-agent that is not discussed as much. Often a licensed real estate broker employs several agents, who work directly with clients. The broker could be a well known and very successful individual, or it could be a company.
So, if there are two agents working for the same broker, it’s considered a dual agency, and there could be conflicts of interest as well. It doesn’t happen as often; however, it’s something you should be aware of.
Bottom line is to get as much information as possible about any connection between your agent and the other person’s agent, and don’t let one person handle the whole transaction until you have the experience.