Let’s first define the differences between an agent and a Realtor.
A licensed real estate agent helps people to buy (buyer’s agent) or list (listing agent), and leads all negotiations. NAR membership is not mandatory for real estate agents. NAR is the National Association of Realtors, the largest trade organization in America. A member of NAR, also known as a Realtor, is required to not only perform the usual agent duties, but also adhere to the Realtor Code of Ethics and attend regular training. They are also charged a $150 annual fee.
Duty and responsibilities for real estate agents and Realtors
Real estate agents conduct transactions for a buyer or seller. They go through the steps. A real estate agent begins by locating a property to sell or buy for a client. They advertise properties by preparing flyers, hosting open houses, etc. The importance of sharing information with all parties in a real-estate transaction cannot be overstated. A real estate agent can provide every detail of a property to a buyer or seller, but should do so in a way that protects confidentiality and does not violate anyone’s right. A real estate agent will also negotiate. They will analyze the information provided by a buyer or seller regarding their requirements and the property and then advise the customer to take certain steps. Agents are not responsible for making the final decision.
What is a Fiduciary duty?
Fiduciary duties are a legal obligation to act in a manner that protects another’s interests. Real estate agents and realtors also owe certain duties to their customers. These duties involve:
Confidentiality
A real estate agent is required to respect the fundamental rights of clients and to not disclose information that could negatively affect the transaction process.
Disclosure
Fiduciary disclosure means to be truthful and fair. Real estate agents should disclose information to customers if necessary for the transaction process, without violating confidentiality duties. This includes all offers, any facts that may affect the value of the property, and other issues that could prevent a buyer or seller from buying the property for a low price.
Loyalty
An agent must be loyal at all times and in any location. Agents are required to put the customer’s interests ahead of all other parties.
Use reasonable care & diligence
Duty of reasonable care and due diligence means that a real estate agent must use all their knowledge and skills to protect the client’s interests and ensure the success of the transaction. All professionals have a duty to their clients. Real estate agents must do their best to demonstrate and use their expertise in their field, and avoid making harsh mistakes or avoiding their duties.
Obedience
Real estate agents are required to follow the lawful instructions given by their clients. Agents should follow the instructions of their clients, even if they don’t agree. Agents are free to ignore instructions if they believe that a client’s decision is illegal.
Accounting
Agents should keep track of all documents, money and property that are involved in the transaction. Accounting should be precise. This is even more important if you are running your own real estate franchise.
The Realtor Code of Ethics
The Code of Ethics, although it was created for members of the National Association of Realtors only, is also beneficial to non-members. The Code of Ethics was adopted in 1913 and includes 17 articles. The Code of Ethics has three types of obligations: to clients and customers; the public; and to realtors. Realtors’ duties to customers and clients include promoting and protecting their interests while not violating the rights of those involved. All realtors must meet the competency standards, and provide equal and appropriate service to all clients, regardless of their nationality, race, religion, sexual orientation, or color. All realtors must respect their co-workers. All realtors should respect their colleagues and be objective with them.
The Realtor Code of Ethics & Standards of Practice is a good place to start if you’d like to learn more.
When a realtor violates the NAR standards it’s usually first discussed locally. This process may involve different bodies such as the Grievance Committee of the association, the Professional Standards Committee, or the Board of Directors. If a violation is proven, the sanctions include a reprimand or a fine up to $5,000, as well as attending a course of education.
Final thoughts
Real estate agents and realtors are not easy to find. Along with their jobs, they have many duties. It is difficult to be an effective real estate agent, but it can still be a rewarding career if you’re self-motivated and hard-working, as well as enjoy interacting with people of all kinds.
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