For whom does the real estate agent work? This is a critical point for all prospective buyers and sellers to understand before you begin working with an agent.
Minnesota Law requires all agents to explain the options for agency relationships upon their first "substantive" contact with a prospective buyer or seller, and to provide a disclosure form entitled "Agency Relationships in Real Estate Transactions".
In Minnesota, four possible choices exist:
Seller's Broker: Broker or agent who represents the seller in the transaction, and is obligated to protect the best interests of the seller. The broker and broker's agents from the listing company represent the seller. Although these agents also often work with buyers, and can assist buyers in the transaction, they must negotiate in the best interest of the seller.
Buyer's Broker: Broker or agent who represents the buyer in the transaction, and who negotiates in the best interests of the buyer. A broker representing only the buyer does not have the property listed for sale. Buyer's brokers may be paid directly by the buyers, or may be paid by a commission split from the seller's broker.
Dual Agency: One broker represents both the buyer and seller in the transaction. Although this is legal in Minnesota, it must be disclosed to and agreed upon by all parties. A dual agent is somewhat limited in the level of service that can be provided to either the buyer or seller, because he/she can not negotiate to the exclusive advantage of either party.
Facilitator: A facilitator represents neither the buyer or seller in the transaction, and may assist with the mechanics of the transaction, but does not owe the same level of service to either party as a seller's broker, buyer's broker, or dual agent.
We will provide you with the agency disclosure at our first meeting - but please be sure to ask if you have questions!
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