Question

A person walks into Urban Realty and asks to be shown some homes in the area. Regarding agency disclosure, the agent must inform the potential buyer of specific facts. Which of the following is required by the License Law?

a) The agent must inform the potential buyer that the agent always represents the seller of any listed property and that the agent will not represent the buyer at all.
b) The agent must inform the buyer that any information received from either the buyer or seller will be fairly communicated to both sides.
c) The agent must inform the buyer that an agency disclosure form must be signed by the buyer prior to any property being shown.
d) The agent must inform the buyer that if the buyer wishes representation, he must sign a Buyer's Agency Agreement before seeing any property.

Answer 1

Agents must make clear through agency disclosure who they represent in a transaction. This can involve stating who they represent, communication responsibilities, and the necessity for an agency disclosure form or a Buyer's Agency Agreement. These disclosures safeguard the buyer's interests and the transaction's integrity.

Step-by-step explanation:

The License Law requires an agent to provide a potential buyer with certain information about their representation in a real estate transaction. Specifically, agency disclosure is crucial as it helps maintain transparency and clarifies the role of the agent with respect to the buyer and the seller. As per the License Law, the agent must disclose to the potential buyer who they represent in the transaction. Depending on the jurisdiction, this might involve informing the potential buyer that:

1. The agent represents the seller and not the buyer unless a separate agreement is made (Buyer's Agency Agreement).
2. Any information provided by the buyer or seller will be communicated fairly to both parties.
3. An agency disclosure form must be signed before showing any property to elucidate the nature of the agent's relationship with the buyer.

This ensures that buyers are adequately informed and can make decisions based on clear understanding of the agent's role, protecting both their interests and the integrity of the transaction.