Why do agents think they are the “dual agent”? You don’t sign the contracts… your BROKER is the one with the agency issue. Have an office meeting folks.

Did most of your commentors forget who the parties are listed on the top of every agreement they generate?

No Realtor group will do it. Ever.

Making single agent dual-agency a violation is well on it’s way, but it’s going to take a bit of time. Money is the root of this evil and we’ll need to find a equitable alternative before change can be made.

It took about 10 years from identifying that the sub-agency relationship was a problem until actually creating buyer agency. In Virginia we actually have a few alternatives, now it’s just a matter of teaching everyone who to execute those alternatives wisely.

Mark, I’d take note of your comment “I’ve never had an unhappy DA client (to my knowledge)” What you don’t know can hurt you. I bought a house using the listing agent before I became a real estate agent. At the time I did not feel that there was any problem and was very pleased with the transaction. Over time I began to feel that my interests were not well represented. There was never any huge problem. But as I got older and smarter I saw the potential problems and felt differently about the agent.

In some other rare instances, I may be either the listing agent or buyer’s agent in a transaction where the other agent also works with the same Broker. This is what constitutes Dual Agency in MD. I always explain the pros and cons to my client and usually my client is motivated enough or trusts me enough to agree to Dual Agency.

To your larger point of thinking differently, outside the box or whatever else you would want to call it, I gently suggest that real estate law (which varies State by State) hamstrings a lot of this “creativity” I think your suggesting. Hell, just the advertising rules I have to follow in MD restricts me from all kinds of interesting marketing.

You are correct. We live in a litigious society. My Broker, the State Association, my local Association, the MD Real Estate commission and even the Federal Government are constantly creating a more and more restrictive environment all in the name of consumer protection.

My brain has enough to try and learn and retain to “stay out of trouble” to make this “Think Different”/Ignore the Rules thing a little hard to get my arms around.

It looks like your state has taken a lot of steps to protect the buyer legislatively. We have “non-client” status where we can do ministerial acts that promise nor provide any opinion. The Buyer is on their own, but we can handle the administrative side of the transaction. It’s a much better option.

The only lien holder who can come back to the seller’s for more money is a HELOC. Since they are usually second position, and most homes around here are ~$100k underwater, a price difference of even $50k wouldn’t make a difference because the first (who has no recourse) would get it. Obviously, there are some exceptions.

In 99% of the cases I’ve been involved with, the final sales price has never been of consequence to the seller.

Also, when we list short sales we have very specific terms that must be included in an offer for our sellers to accept, which include a portion of their earnest money to be non-refundable for the first 90 days. This keeps buyers from walking after 6 weeks.

The examples you gave deal specifically with your state laws (as they should). Our state is much more open in their disclosures (the short sale has to be disclosed in the MLS). I have yet to see a short sale where DA caused the deal to fall apart, but I have seen many short sale deals not work because other agents not knowing what is happening.

I guess the answer to DA in short sales really depends on your state laws.

Some of these Short Sales are recourse loans and the Seller still maybe on the hook after closing for some of the deficiency. You’re still inherently left with a buyer who wants the lowest cost and the seller who wants the most. Moreover, many of these sales still have other contingencies and negotiations to deal with.

I think if anything, a distressed sale is more litigious an a dual agency situation. The real question is what is the REAL benefit to the client in Dual Agency of any support. Your Short Sale negotiations may be simpler, but everything else is still dealing with those who have conflicting needs.

Divorces are simpler with one negotiator, but how many couples hire the same attorney?

Here’s an example of just one potential conflict in a Short Sales (this is dependent on your state law). Let’s say you’re representing a buyer and seller. Some as basic as an escrow deposit could be a conflict. As a buyer agent I never want to commit my client more than I have to in a Short Sale because we only have a 65% closing rate regionally (my company’s success is much higher). For a buyer I would recommend that we not deposit the escrow until the Lien Holder has given actual written approval of the short sale. However, as a Listing Agent, I don’t want the house under contact without actual money in the bank. To even give recommendations like these could be a breach of undivided loyalty. To not give that advice to both clients would be a breach of giving them my best advice…

Let’s do one more: In Virginia the pursuit of a Short Sale is “confidential fact” and only disposable with written permission of the Seller. What if the Seller declines to give that consent and you are also representing a Buyer?

There are many, many more examples…

Great question!

Chris: I’m with you “Bring it On!” We may not always like the changes either, but the consumer is in more control than they have been before – so in some ways we (as consumers) will benefit from the changes.

Chuck: Many are afraid of change because it pushes them to have to learn differently. I often think that this fear is a result of laziness.

Ken: GREAT quote!