Real Estate Q & A >

Ethics

Where can I find a Real Estate Agent "Code of Ethics," if there is such a thing?

Some real estate agents are members of the National Association of Realtors, which does have a code of ethics for their 720,000 members. It is located at http://www.realestateabc.com/codeofethics/

I have reason to believe that the seller's agent was not truthful about the opposing bids for a property. I'm suspicious he made up bids to drive up the price I eventually offered. Do I have the right to demand proof of the opposing bids?

An agent or a seller is not obligated to divulge details of competing offers. You can ask for it in a counter-offer, but you may be taking a risk on losing the property altogether. If you feel you were a victim of fraud, you should consult with an attorney and ask him or her for advice.

Can a broker sign an Exclusive Buyer Representation Agreement with a buyer when that broker is representing the seller as a dual agent? Isn't this a conflict of interest?

There are a few different forms with similar sounding names. The form you signed probably means you agree to use that agent exclusively and will not go out looking for another agent.

The other form with a similar name does what you suggest. It means the agent will only represent you in the particular transaction.

Read what you sign. Get copies.

I am an out of state owner and made a deal to sell my vacant lot. The buyer was a licensed real estate agent who within a week (and before we closed our transaction) had sold it to someone else for $50,000 more than what they paid me. Is this legal or ethical?

It sounds like you are asking if you have a legal case to sue the individual. For that you need to consult with an attorney. If I were you, I would certainly be talking to an attorney.

Is it legal for an agent representing the buyers in a deal to lend money to their client for the down payment on a home?

This is not legal advice, so don't take it as legal advice.

Most mortgages don't allow the borrower to borrow money for the down payment. If the borrower conceals the fact that they are borrowing money for the down payment, then the borrower is committing fraud against the lender.

Is the Realtor doing anything illegal? From the lender's point of view, the borrower is the client, not the Realtor. The application specifically asks if any part of the down payment is borrowed.

But this is supposed to be a forum about the 'real' world of real estate, and the truth is that things like this do happen without any consequences. If every loan and every purchase was done strictly according to the rules, many fewer homes would be sold and fewer loans would be originated. No one is supposed to say that, but it is true.

This is not to say that such a practice is "okay" - just to say that it occurs.

If it is brought to the attention of the lender in some way, however, they may "call" the loan, which means the borrower would have to refinance the loan and get a new mortgage.

If the borrower gets into serious financial trouble because they took on too many obligations (including the borrowed money from the agent) - and they blame their Realtor - lawsuits could begin flying and sometimes have disastrous consequences.

I listed my house with an agent with the understanding that if one of two friends buy my property, she would be compensated at 3% commission. One of my friends has made an offer. When my agent sent me the estimated pay out from the transaction, she put in her commission as 6%. Her explanation is that the original deal was only good until she listed the house in MLS. Is this ethical? Or legal?

Sounds like...well, it doesn't sound ethical, does it? Since agents generally list a property in the MLS immediately, it doesn't sound like a genuine explanation. You should have made sure the listing contract contained this stipulation, but that is looking backward. One explanation is that she found it difficult to tell her manager of her agreement with you, and now that she is stuck, doesn't know how to fix it.

I would call the Realtor's manager and start out very nicely and tactfully about your verbal agreement with the agent, and how that seems to have become "confused."  Normally, the desire to build good will in the community will convince the manager to acquiesce and adjust the commission appropriately.

Back to Real Estate Questions

Ask Your Question



Featured Articles