What You Should Know About
Law Of Agency In Texas
Helpful
Information
From Your
REALTOR®
Michelle
Storms
Description of Agency Relationships | |
(FOR CO-OP TRANSACTIONS)  One type of real estate transaction involves a seller who has listed property for sale with a real estate broker and is presented with an offer to purchase from a buyer who has engaged another broker. Both brokers have individual sales associates to act on behalf of the broker in the transaction. In this transaction the broker for the seller and the broker's sale associate exclusively represent the seller. The other broker and its sales associate working for the buyer exclusively represent the buyer. (FOR IN-COMPANY TRANSACTIONS) Intermediary status was created by the Texas Legislature in 1995 and was designed for use when a buyer and a seller are represented by the same broker - such as when a buyer wishes to purchase a property listed for sale by the Broker. In such a transaction, with the written consent of the parties, the broker may work with both parties to the sale. As an Intermediary, the Broker (1) will treat both buyer and seller honestly, (2) will not disclose that the seller will accept a price less than the asking price unless authorized to do so by the seller, (3) will not disclose that the buyer will pay a price greater than the price submitted in a written offer unless authorized to by the buyer, (4) will not disclose any confidential information or any information that a party specifically instructs the broker in writing not to disclose unless authorized in writing to disclose the information or required to do so by law. The Broker, with the written consent of the parties, may act as an Intermediary in two different circumstances explained as follows: |
Separately with Buyer and Seller  When the Buyer and Seller wish to have the Broker act as an Intermediary in the sale and each have separate agents of the Broker working with them, then Broker may appoint each agent to act as an "Appointed Licensee." Under these circumstances, the Appointed Licensee will carry out the instructions of the parties to whom they are appointed and will render professional advice and opinions to the parties during the transaction. Working With Both Buyer and Seller  When the Buyer and Seller in the transaction wish to work with the same sales associate of the Broker, then the sales associate will act as a "Intermediary Representative" of the Broker. Such a transaction presents a greater potential for a conflict of interest between the Broker and the parties which precludes the Broker and its Intermediary Representative from promoting the interest of one party over the other. In this situation the Intermediary Representative will not render professional advice or opinions to either party so as to remain fair and impartial to both parties, however may provide information and assistance. |
