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As any real estate brokerage firm should explain to you the customer, at “first substantial contact” (meaning just before the details of your transaction are discussed), we will explain about the way “agency” in the state of North Carolina works. This explanation should be given to you in one form or another by any real estate brokerage firm that you discuss any details with about your plans to purchase or sell a home. An explanation of this system is not only mandated by they NC Real Estate Commission, but is also an ethical and moral “must do.”
First let me begin by telling you that there are three basic types of agents under NC Real Estate Law. There are buyer agents, seller agents, and dual agents. Within these three groups there are different types of each, such as: exclusive and non-exclusive agents, seller sub-agents, and designated dual agents. While confusing at first glance, each of these methods has one goal in mind, that is to protect you the consumer.
Seller Agency - This term is exactly what it sounds like. A seller has contracted an agent to sell their home. The seller’s best interest is always paramount for this agent. Any information the seller agent learns that could help the seller get a better price for their home is disclosed to the seller. Most for sale signs with an agents name on it in a yard means that that homeowner has a seller agency agreement with that agent. The important thing to remember here as a consumer is that anything you tell this agent over the phone, via email, or in person will be disclosed to the seller, as the agents primary duty is to help the seller.
Buyer Agency - This situation is where a buyer contracts an agent to help him/her find a home. A buyer agency agreement is signed which obligates the buyer agent to do everything possible to get the buyer the home they want at the price they want. An agent may show you a home or two without an agreement, but until you sign a buyer agency agreement with the agent, they are legally a seller sub-agent under NC law, and must disclose any of your pertinent information to the seller. The easiest way to insure you are protected is to sign a buyer agency agreement with your agent. This legally obligates the agent to keep your confidential information from the other party, and binds the agent to use his/her best efforts to get you the best price possible. Buyer agency agreements can be signed just for one property, for one day, or for any set number of days. It is less about binding the client to an agent as it is about protecting the clients confidential information.
Dual Agency - This is a situation that is becoming more and more common in NC. Dual agency occurs when a broker who has a property listing is also the broker who brings the buyer to the transaction. Firstly, the buyer and seller must agree to dual agency and once dual agency is established, the broker can no longer negotiate for one side or the other. The broker can not share confidential information between parties. The broker can simply facilitate the sale without giving either party an advantage or disadvantage.
Agency is a topic that one could spend days discussing, but at the very least, I hope this explanation gives you some insight into how our system works in NC. Another resource is the official NC Real Estate Commission pamphlet entitled, “Working With Real Estate Agents” You can download a copy here or view it directly from the NC Real Estate Commission website here. This pamphlet should be explained to you by any agent you discuss transaction details with regarding the purchase or sale of a home. Please feel free to call or email us for a detailed explanation of anything listed above. Your understanding of Agency in NC is a primary goal of Yellow Dog Realty in any transaction.
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