Listing Agent showed me a home, Can another agent represent my interest after the listing agent
Rental Property Investor · Oak Park, MI · Member since 2013 · 222 posts · 35 votes
Listing Agent showed me a home, Can another agent represent my interest after the listing agent
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Realtor · Lafayette, LA · Member since 2011 · 297 posts · 175 votes
11yusing the listing agent is like using your wife's divorce attorney. The listing agent is hired to represent the seller. Find a hungry buyers agent and it will make your life easier
13 Replies
- 11yBrett SynickyPro MemberSolo 401k and SDIRA Consultant · Orange, CA · Member since 2013 · 875 posts · 498 votes
I'm not sure if Michigan allows dual agency but here in Cali you could buy directly through the listing agent, another agent from the same brokerage as listing agent, or a buyers agent. Is there any reason you wouldn't want to buy through the listing agent?
not sure the answer on this but I have bought properties with and without a buyer's agent.
I myself like to deal with the broker directly. I feel that gets me even closer to the home owner. Also I like to negotiate, its a rush for me so I hate to give that up when dealing with a buyers agent.
One time I toke the phone from my agent and talked out a deal in a few minutes. The agent still got his cut so it made no difference
- Rental Property Investor · Oak Park, MI · Member since 2013 · 222 posts · 35 votes11y
First thank you both for the replies,
Im sorry let me give you a bit more information, Currently im prospecting a 3plex but im also a Car hauler which means im only home 4 days out of a month and often times im not in the detroit area more times then not, currently i cant even get the Pro forma data to even analyze this property. So im thinking i definitely need some help, im also a first time buyer using a va loan.
So recently i saw a home i like and im trying to work with the listing agent but i feel like my interest aren't priority
Originally posted by @Tereal Wilsonn:
First thank you both for the replies,
Im sorry let me give you a bit more information, Currently im prospecting a 3plex but im also a Car hauler which means im only home 4 days out of a month and often times im not in the detroit area more times then not, currently i cant even get the Pro forma data to even analyze this property. So im thinking i definitely need some help, im also a first time buyer using a va loan.
So recently i saw a home i like and im trying to work with the listing agent but i feel like my interest aren't priority
Well first. Thanks for putting in on the line for us.
Wow 4 days a month that's insane. You will need a good buyers agent for sure. You need to have a good long talk of what you are looking for.
Good luck, where did you find a 3 plex at. Not many around that I have found
- Realtor · Lafayette, LA · Member since 2011 · 297 posts · 175 votes11y
using the listing agent is like using your wife's divorce attorney. The listing agent is hired to represent the seller. Find a hungry buyers agent and it will make your life easier
- Rental Property Investor · Oak Park, MI · Member since 2013 · 222 posts · 35 votes11y
But im still not getting my question answered fellas, So i after i saw this triplex, i tried contacting an buyers agent that would represent me, so she told me since the listing agent showed me the property, she wouldn't be able to represent me, does this mean if i want this deal to go thru i cant use a buyers agent?
- Real Estate Broker & Investor · Mount Pleasant, MI · Member since 2013 · 53 posts · 22 votes11y
I'm a practicing real estate and broker in Michigan. The answer to your question is yes, a buyer's agent can represent you in the transactions however in order for them to be compensated they should show the property to you in advance of submitting an offer. The industry term is called procuring cause. Any competent buyer's agent will understand this concept.
- 11yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
this happens all the time when your an agent you show a property to a buyer ( your the listing agent) they don't tell you they have an agent or they just flat lie.. the next thing you do is get a call from their buyers agent who wrote the contract.. You as the listing agent just grin and bear it...
The listing agent must take the offer from your agent regardless of procuring cause.. I don't think the RE agency gets into commission squabbles at least not on the west coast they dont'... But in general its best to have your own agent represent you if you are a first time home buyer or not that experienced.
On the investor side its the other way around you want to go to the listing broker so the listing broker is getting doubled ended commish.. they will push your deal through before they have to co brok and make half the commish just human nature and greed at play.
- Longmeadow, MA · Member since 2014 · 45 posts · 17 votes11y
80% of the time I work as a dual agent on deals I close. The biggest difference there is an agent representing both sides can't make any suggestions on price and needs to act more like a mediator in the deal. Both you as the buyer and the sellers need to sign consent to be represented that way as well. If exclusive representation is the best option for you what I would suggest is telling the list agent that and requesting they get you a buyers agent. Every dual deal I work I explain dual agency to them and ask them if they would prefer me to get them a buyers agent for the deal. I have yet to have somebody say yes to that, they always have preferred to work with me...but I think that is simply because I bring my baby with me and people like seeing a cute little baby. The list agent can collect a referral fee from the buyers agent representing you so they get something on both sides which I feel is fair since this other agent didn't find or show you the property and therefore get paid a fair portion for a fair amount of work.
- Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes11y
Showing a property doesn't create any agency relationship, laws of agency apply in all states and to be represented in RE you must form that agency relationship in writing, that means in your case, a Buyer's Agency appointment. In other areas of business you may have an implied agency relationship, but that's not appropriate here.
You may acquire representation at any time prior to contracting, if you execute a written offer without representation then you will be acting on your own behalf, but by law you will then fall into a limited agency relationship with the listing agent. This limited agency arrangement will only provide you with those services in connection with that transaction to facilitate the sale and the listing agent may not advise you as to offer or price.
As Stephen mentioned, a buyer who uses a listing agent is like using your spouse's attorney in a divorce. The listing agent has a greater duty to the seller under their agency relationship than they do under the limited agency duties to the buyer. An agent by law is required to do certain things (any agent, not just RE agents), the duty to communicate all material facts pertaining to the representation, the duty to safeguard the principal's interest and keep information pertaining to the principal's interests confidential and to account for all monies owed to the principal.
In RE, that means that a listing agent may prequalify you, give suggestions as to financing, explain title matters or disclose property conditions. They may do those thing customary to facilitate the transaction and give assistance. This function will likely be seen by a less savvy buyer that the listing agent is representing their interests, they don't really, only to the extent to give that assistance necessary to facilitate the transaction. That buyer is usually unaware of the greater duty owing to the seller, except that agents entering into dual agency roles will give the buyer a disclosure (might read that carefully).
So, say in the prequalification stage the listing agent discovers that you have X dollars in savings and that you are qualified for a mortgage payment at a full price offer. That is a material fact in knowledge gained by the listing agent and they must communicate such discovery to the seller! They are not required to communicate to the buyer that any information gained may be disclosed to the seller, unless it was disclosed in the required disclosure given to that buyer as mentioned.
So, a buyer needs to take care in what they might say to a listing agent, you might as well be speaking to the seller! Think of it this way, a servant can not serve two masters and an agent is a servant to the principal.
A Buyer's agent represents the buyer and their best interest. But there is a bit of difference in RE too. Because of the unique nature of RE and in the public's best interest, a buyer's agent has related duties to their broker and that "buyer's broker" has responsibilities to the listing broker who is ultimately responsible for the sale transaction and settlement. These relationships are generally better formed through the local Board of Realtors if the agents are Realtors (not all RE agents are Realtors). At a higher level, all agents and brokers have responsibilities to the seller, but a buyer's agent's first duty is to their client, the buyer.
To illustrate this, consider deposit money on a contract. A buyer gives money to the buyer's agent, but the responsibility to account for funds then goes to the buyer's broker, then funds are placed in escrow under the responsibility of the listing broker and the duty is the safeguarding of funds for the benefit of the seller.
As to the procuring cause mentioned, this is evidenced by the listing itself, a listing agent is entitled to the listing commission by virtue of the listing agreement and advertising of a property. The listing agent places the "listing" in the MLS which gives notice to all agents as well as the public that the property is offered for sale. They are not entitled to the buyer's side under any split commission arrangement which is set by and between brokers, generally through a membership agreement in the Board of Realtors, simply by showing or advertising a property.
The buyer's side of commissions is determined, by who signed the offer or contract showing the applicable representation for the benefit of the buyer. While local custom may be different as to the execution of the contract by an agent, a listing agent may sign both sides of the contract indicating a dual agency relationship and thereby being entitled to the full commission.
Part of a listing agent's duty is to show the property and expose that property to the open market, so a showing alone does not entitle that listing agent to any commission due a buyer's agent, that is determined by executed contract as mentioned.
State laws vary as to the duties of an agent and when a dual agency arrangements exist, but the laws of agency mentioned are applicable and generally govern unless specifically addressed by state law.
New investors need to be aware of these relationships and duties of agents and they would be best advised to obtain representation by a buyer's agent for a listed property. :)
- Realtor · Detroit, MI · Member since 2013 · 278 posts · 114 votes11y
There are a lot of great responses here. I am a local Realtor in the Detroit Area. My best advice is to use a buyer's agent. If you didn't sign an agency relationship or disclosure form then the listing agent doesn't represent you.
As @David Zamarron stated there is a something called procured cause meaning that if the listing agent showed it and the buyer submits an offer with another agent technically the listing agent is entitled to both sides of the commission.
I would contact the listing agent and explain that you have an agent on your investing team and that he or she is going to take you back through the property and then you will decide then if you will submit an offer.
- Rental Property Investor · Oak Park, MI · Member since 2013 · 222 posts · 35 votes11y
I don't even know where to begin to thank all of these well thought out through answer, after reading this I found an invester agent and signed an agreement so they can represent my intrest ,
Thank you everyone , I'm now better prepared to start on the right track
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