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Understanding Maryland's Required Agency Disclosure
Any time a real estate agent in Maryland meets with a buyer or seller, at their first scheduled face to face meeting, they must provide a written disclosure form which explains all of the options a party has concerning agency, or representation. The agent is also required to explain the form to buyers and sellers. Sellers, and especially buyers, have several options as to how they can work with an agent.
Agents Who Represent The Seller
A Seller's Agent works for the company that lists and markets the property for the sellers, or landlords, and exclusively represents the sellers or landlords. That means that he or she may assist the buyer or tenant in purchasing or renting property, but his or her duty of loyalty is only to the sellers or landlords.
A Cooperating Agent works for a real estate company different from the company for which the seller's agent works, but is still considered to be representing the seller and his or her duty of loyalty is only to the sellers or landlords.
Both the seller's agent and the cooperating agent are obligated to look out for the seller's best interest. This means if the buyer says anything that affects negotiations, such as a statement that they are willing to pay more for the house, the agent must pass it on to the seller.
Agents Who Represent The Buyer
When a buyer first meets with a real estate agent, the agent is presumed to be representing the buyer until either the buyer or agent decide otherwise. The agent is known as a Presumed Buyer's Agent. The presumed relationship may continue as long as the buyer is only looking at houses listed with other real estate companies. The agent may NOT show a house listed with his or her own company as a presumed buyer's agent. The presumed buyer agency relationship must also end when the buyer wants to put in an offer on any property, no matter what company the house is listed with. A presumed buyer's agent has a limited representation of the buyer, and may not help the buyer in any negotiations. A buyer is not required to sign anything to work with a presumed buyer's agent, but the agent is still required to provide them with a written agency disclosure form, and is still required to explain all of the buyer's options concerning representation or agency.
A Buyer's Agent can fully look out for the best interest of the buyer throughout the entire process, from the home search, to the contract negotiations and all the way through to settlement. To enter into a buyer agency, the buyer must sign a written buyer agency agreement.
Dual Agency occurs when both the buyer's agent and seller's agent in the same transaction both work for the same company. The company, or the company's broker (the licensee in charge of all the company's agents in the state), would be considered the Dual Agent. The dual agent (the company's broker) may not assist either the buyer or seller in negotiations, as they are representing both parties. The salespeople representing the buyer and seller are referred to as Intra-Company Agents, and can still continue to fully represent their buyer or seller.
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