Agent2Agent in Arizona>Question Details

Sandra Paulow, Real Estate Pro in Pinetop, AZ

Does anyone beside me see representing both the Buyer and the Seller in the same transaction as a problem waiting to happen?

Asked by Sandra Paulow, Pinetop, AZ Sun Jan 23, 2011

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In short, I think it's an abomination to all clients, and a disgrace in the industry. Now do you want to know how I REALLY feel about it? LOL If I could make it happen, I would outlaw it AND make it a breach of ethics. The only one that wins in double-dipping is the agent/broker - it's darn sure not the clients.

And guess what, dual 'representation' HAS resulted in many lawsuits. But NAR chooses to look the other way, as does the ADRE. Go figure...
1 vote Thank Flag Link Sun Jan 23, 2011
I am glad to know that I am not the only one who finds this situation problematic. Every State has different views and laws regarding dual representation and perhaps it isn't as problematic in other areas. In Arizona because there are no Attorney's involved in the transactions the responsibility falls on the agent and their broker alone and it is a difficult place to be. If one party tells you something that the other party should know and you can't tell it, you are violating the disclosure obligation on the other side of the transaction. You should tell but you can't and therein lies the problem. It is not a comfortable place to be and like Jim from Arlington, if you don't put yourself in that position in the first place at least you can sleep at night.
0 votes Thank Flag Link Mon Jan 24, 2011
Absolutely.......I would have to believe this is real estate situation that is in bad need of repair......if you are representing both parties, how can you objectively look out for both party's best interest?

0 votes Thank Flag Link Mon Jan 24, 2011
I agree Sandra and I DON'T think it has anything to do with a lack of professionalism (sorry Sean).

I don't do it. I'd make a lot more money, but I'd rather sleep at night and not worry about saying too much to either party!
0 votes Thank Flag Link Mon Jan 24, 2011
Our role is to find solutions for buyers and sellers, but our names are not on the contracts and we are not part of the deal. As such, if you can't treat each party with the professionalism that you would give any customer, you need to get out of the business. Whether you have one side of the transaction or both sides makes no difference. If you feel that one side may put undo pressure on that professionalism, walk away. The best deals we'll ever facilitate are the ones we won't do.
0 votes Thank Flag Link Mon Jan 24, 2011
RIGHT ON Randy (and Sandra!)....

Randy, I couldn't have said it better!

You are correct, the only 'big winner' is the agent! Not good, and one of the many reasons that agents tend to get a 'bad rap' (for lack of a better/worse word!).

Thanks to both of you for being painfully HONEST with what's BEST for the client and transaction as your number one concern!!!

I'm sure that both of you are successful, and it's because you 'get it'!
Web Reference:
0 votes Thank Flag Link Mon Jan 24, 2011

Steping out of your comfort zone always presents itself as a problem.

Dual agency is a great thing for everyone, in a sense it's almost a gag order for the agent as the agent really has to maintain confidentiality for the clients, but in reality it's the agent that has to bring both parties to an agreement.

Disclosure is a must, without it you can't have it, and you'll have a lawsuit. If you're a listing agent and the seller does not agree, you can't have dual agency. This is where you sell yourself to the seller and the buyer.

Good Luck,

Ray Garcia
0 votes Thank Flag Link Sun Jan 23, 2011
I've heard that excuse, too. So for the .01% of the population, couldn't they make an exception for low population areas and/or towns that have less than 2 licensed agents?? I'd actually love to see those stats! Instead, they jeopardize the rest of the 99.99% of the state's populace by leaving dual rep legal?? That makes no sense to me whatsoever, and ADRE's excuse is VERY weak - IMHO.
0 votes Thank Flag Link Sun Jan 23, 2011
I have heard that ADRE would like to eliminate it but they feel they can't because in remote areas where there are only one or two agents, they couldn't do any business if they didn't allow it.
0 votes Thank Flag Link Sun Jan 23, 2011
I have never been comfortable in the situation. There is no way to do your best for either party. You are like the peanut butter in a sandwich. On the one hand you have the duty to disclose but in Limited Rep. Situations you can't tell either party what you know. So if one party tells you something the other party really should know in making a decision, you can't say anything. On the other hand if something happens down the road the the party that didn't know finds out somehow that you knew something they should have known than you are on the hook for lack of disclosure.

I have done this and done it successfully but in every situation where I have been involved I held my breath the whole way through hoping something didn't happen that would take a bite out of that peanut butter sandwich.
0 votes Thank Flag Link Sun Jan 23, 2011
In Massacusetts we have disclosed dual agency and although it can be tricky if done properly it can be done to benefit both clients. Full disclosure is the key. Best of luck in AZ
0 votes Thank Flag Link Sun Jan 23, 2011
ABSOLUTELY!!! I think it's a dis-service to buyer, seller and all potential buyers. The mere fact it's even legal in most states blows my mind!!

It's not only a problem, it's simply not in the best interests of either buyer or seller.

States go thru great lengths to "disclose" the potential of dual agency, and ask permission of the client to accept or reject dual agency. This doesn't change the fact that dual agency is wrought with problems.

I've fortunately been able to handle dual agency situations successfully, but I'm not comfortable being in that situation, for the buyers, for the sellers and for the other agents bringing offers. Fortunately, I've handled them by doing what is BEST for both buyer and seller, NOT what is best for me as an agent standing to get a dual commission. In a few cases, I've had multiple offer situations, and the best offer for the seller was the one that did not give me the dual commission, and I could have EASILY swayed the deal/seller to take the offer where I made double....but I DID NOT!! What bothers me is how many times do agents get tempted by a dual commission to not do the right thing? Too easy for them to lean in the direction of a dual commission at the expense of their Seller's best offer!

This temptation should not be available to agents. I'm sure this opinion of mine and Sandra's will create lots of comments. On valid question: "How are you supposed to sell your own listings?".... and I'm not sure of the answer, which is likely why dual agency is still legal in most states.

Any one know which states disallow it? I've heard there are a few, I could be mistaken!

Just my 2 cents! :-))))
0 votes Thank Flag Link Sun Jan 23, 2011
Every state is different. My state (KS) doesn't allow you to represent both. We can represent the buyer and then the seller would have to be "unrepresented". Both parties would need to understand what those terms mean and agree.

Our office has had some occasions where it was beneficial to both parties because we weren't having to try to get information from another office. Short sales can require a lot of patience on everyone's part.
0 votes Thank Flag Link Sun Jan 23, 2011
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