Uniform Duties of a Real Estate Broker
by Modene Gaulke, CEO, RCE, e-Pro
People who work in the real estate industry (real estate brokers) are to be admired. Until I took some real estate courses myself, I was unaware of all the information they have to carry around in their heads at all times. And, they have to keep updated on any changes that take place in license law.
Home selling and buying are among the costliest decisions consumers make in a lifetime. They need someone they can rely upon to guide the process to achieve a seamless transaction all the way to the closing table.
So, how do real estate brokers accomplish that? In Colorado License Law, the Listing Contract sets forth certain brokerage duties called “Uniform Duties.” If a broker adheres to all of those duties, and there are no unforeseen or undisclosed circumstances, then sellers have a winning situation. A broker cares about his or her reputation and will do all it takes to close the transaction.
However, even though all brokers are obligated to know the uniform duties they are required to perform, some forget from time to time what those are. I think that’s because people establish patterns of behavior and sometimes skip over “little” details that can make a huge difference in whether or not a transaction closes successfully. Taking the necessary time to perform the uniform duties can be a challenge but doing so can potentially save a broker from an ethics complaint or going to court.
Here are the duties every consumer has a right to expect from a real estate broker:
- Perform the terms of any written or oral agreement with Seller
- Present all offers to and from Seller in a timely manner regardless of whether the property is subject to a contract for sale
- Disclose to Seller adverse material facts actually known by Broker
- Advise Seller regarding the transaction and advise Seller to obtain expert advice as to material matters about which Broker knows but the specifics of which are beyond the expertise of the Broker
- Account in a timely manner for all money and property received
- Keep Seller fully informed regarding the transaction
- Broker must not disclose the following information without the informed consent of Seller:
- – That Seller is willing to accept less than the asking price for the property
- – What the motivating factors are for Seller to sell the property
- – That Seller will agree to financing terms other than those offered
- – Any material information about Seller unless disclosure is required by law or failure to disclose such information would constitute fraud or dishonest dealing, or
- – Any facts or suspicions regarding circumstances that could psychologically impact or stigmatize the property.
- Seller consents to Broker’s disclosure of Seller’s confidential information to the supervising broker or designee for the purpose of proper supervision, provided such supervising broker or designee does not further disclose such information without consent of Seller, or use such information to the detriment of Seller
- Brokerage firm may have agreements with other Sellers to market and sell their property
- Broker may show alternative properties not owned by Seller to other prospective buyers and list competing properties for sale
- Broker is not obligated to seek additional offers to purchase the property while the property is subject to a contract for sale
- Broker has no duty to conduct an independent inspection of the property for the benefit of a buyer and has no duty to independently verify the accuracy or completeness of statements made by Seller or independent inspectors. Broker has no duty to conduct an independent investigation of a buyer’s financial condition or to verify the accuracy or completeness of any statement made by a buyer
- Seller is not liable for Broker’s acts or omissions that have not been approved, directed, or ratified by Seller
- When asked, Broker (will or will not) disclose to prospective buyers and cooperating brokers the existence of offers on the property and whether the offers were obtained by Broker, a Broker within Brokerage firm or by another broker.
What does all this legal language mean? It means that communication is KEY in every real estate transaction. Broker to broker; broker to buyer or seller; broker to appraisers, inspectors, title companies and lenders.
These uniform duties are hammered into prospective brokers as they take their pre-licensure classes, but also post-licensure as they take continuing education.
If, as a consumer, you ever wonder whether you are getting the best possible service from your broker, just review the Uniform Duties section of your Listing Contract. Most brokers will do all of those things, and then some.
There are probably always going to be a small number who will try to hurry up and get the transaction closed and in so doing, overlook some of the steps. If a consumer is harmed by this, and they are working with someone who carries the brand “REALTOR®,” then they have the option of filing an ethics complaint against the broker. That’s because the National Association of REALTORS® has a very strict code of ethics which covers duties to the consumer as well as duties to other REALTORS®. Every person with the REALTOR® brand is obligated to follow that code.
It’s a good idea to keep a checklist of the Uniform Duties close by for easy reference from time to time. It never hurts to check up on yourself. Better you doing the checking than some judge because you forgot something. Right?
Montrose Association of REALTORS®