NY state law requires real estate agents to have clients and customers sign a form stating that they understand whom the agent represents and to whom the agent will give "undivided loyalty," as soon as they enter into a relationship.
The disclosure law is designed to clarify the roles of buyers' and sellers agents, in order to, as the form itself states, "help you make informed choices about your relationship with the real estate broker and its sales associates.
A seller’s agent does not represent the interests of the buyer. The obligations of a seller’s agent are also subject to any specific provisions set forth in an agreement between the agent and the seller. In dealings with the buyer, a seller’s agent should (a) exercise reasonable skill and care in performance of the agent’s duties; (b) deal honestly, fairly and in good faith; and (c) disclose all facts known to the agent materially affecting the value or desirability of property, except as otherwise provided by law.
A real estate broker may represent both the buyer and seller if both the buyer and seller give their informed consent in writing. In such a dual agency situation, the agent will not be able to provide the full range of fiduciary duties to the buyer and seller. The obligations of an agent are also subject to any specific provisions set forth in an agreement between the agent, and the buyer and seller.
Dual Agent with Designated Sales Agents:
If the buyer and seller provide their informed consent in writing, the principals and the real estate broker who represents both parties as a dual agent may designate a sales agent to represent the buyer and another sales agent to represent the seller to negotiate the purchase and sale of real estate. A sales agent works under the supervision of the real estate broker. With the informed consent of the buyer and the seller in writing, the designated sales agent for the buyer will function as the buyer’s agent representing the interests of and advocating on behalf of the buyer and the designated sales agent for the seller will function as the seller’s agent representing the interests of and advocating on behalf of the seller in the negotiations between the buyer and seller. A designated sales agent cannot provide the full range of fiduciary duties to the buyer or seller. The designated sales agent must explain that like the dual agent under whose supervision they function, they cannot provide undivided loyalty. A buyer or seller should carefully consider the possible consequences of a dual agency relationship with designated sales agents before agreeing to such representation. A seller or buyer may provide advance informed consent to dual agency with designated sales agents by indicating the same on this form.
- In NY state the broker is the agency not the agent. Therefore when an agent at the same brokerage that is a listing agent representing the seller and another agent at the same brokerage representing the buyer as a buyer's agent under NY DOS agency law that transaction will be a dual agent with designated sales agents.
- A buyer who attends an open house or contacts a listing agent directly and had no former dealings with the agent is a direct customer of the seller's agent. The seller's agent does not represent the buyer but treats the buyer fairly and honestly.
- Dual agency occurs when a buyer is already working with a buyer's agent being shown exclusive properties listed by other brokers and has a relationship with agent can become a dual agent if buyer decides to purchase that agent's exclusive listing. Both buyer and seller must agree to dual agent:
Corcoran represents the seller/owner on Corcoran's own exclusives, except if another agent of Corcoran represents the buyer/tenant, in which case Corcoran will be a dual agent with designated agents representing seller/owner and buyer/tenant. Corcoran represents the buyer/tenant when showing the exclusives of other real estate firms. In all instances Corcoran treats all parties fairly and honestly .