http://blog.seattlepi.nwsource.com/realestate/archives/130332.asp

http://blog.seattlepi.nwsource.com/realestate/archives/130332.asp#comments

David, I thinkyou were questioning Dual Agency, not an agent being both the real esate agent + the loan originator, correct?

Yes, I was questioning dual agency, and I still don’t think my question has been answered.

Can the person acting as the Listing Agent be the Buyer’s Agent on the same property?
If answer to #1 is yes, how does the agent hold up his fiduciary duty to both sides. seller = highest price. buyer = lowest price

One word answers are acceptable.

Many of the larger companies maintain a “standards of practice” program. I know about Windermere’s, because I work there. A standards of practice committee meets monthly to mastermind around real estate issues and practices to direct the Windermere Standards of Practice. Some real estate companies practice diligent oversight of their agents, and sadly others don’t so much.

As I look back on my career, from a service standpoint, some of my most troublesome transactions were a result of the real estate agent writing the loan.

When I receive an offer from an agent/loan officer, my personal standard of practice is to require the borrower to be approved through my lender of choice. I don’t’ require the borrower to use the lender (of my choice), but I definitely want to make sure the borrower is qualified.

I also had an agent/loan officer who tried to insist on his escrow company because “his escrow company would play ball” with his terms and loan program. It had the smell of fraud all over it. This was a deal we didn’t put together because we wouldn’t “play ball.”

If you call me up and say you want to see my listing, and I show it to you, I legally can only represent the seller, unless the seller gives me written permission to become a dual agent. Since I don’t know you, I have no legal agency relationship with you, just like when you walk into a car dealer and buy a car from the salesperson on site — that salesperson represents the car dealer and not you, the customer.

Do you see why? If you want to buy, you need a Buyers Agent to represent you. I believe in the 80/20 rule. 20% of the agents are the agents that are top-notch, so ask for referrals from people you respect, and interview their agents.

I teach all over Wa state. In the greater Puget Sound area there are hundreds if not thousands of real estate agents that also originate loans as well.

A code of ethics in any profession is a living document, meaning, it should change over time. I sure when the Realtor Code first came out 100 years ago it looked radically different than it does now.

Currently, in regards to originating loans and also acting as a Realtor, the Realtors are directed to act according to federal and state law (among other things like duties of honesty.) Maybe someday if Realtors believe that it would help raise ethical standards, the group would agree to not also act as a mortgage loan originator as well as a Realtor on the same transaction.

Most Realtors I meet who also originate loans tell me that they got into the origination side because they witnessed too many of their clients being taken advantage of by predatory lenders.

We can look at it from another angle. I have met financial planners who originate loans. They don’t do very many deals, and when they do, they charge zero fees that a traditional mortgage broker would charge because they are making up for it on the fees they earn on the financial planning side. Unethical?

Dual Realtor/LO capacity surely speaks to a need for a new section in the Realtor Code that would address the Realtors fiduciary duties to the client in BOTH roles.

WASHINGTON (AP) — Sales of new homes plunged by a record amount in 2007 while prices posted the weakest showing in 16 years, demonstrating the troubles builders are facing with a huge backlog of unsold homes…..

I just wanted to know how it’s ethically possible for an agent to work both sides of a transaction as well as hold up their fiduciary responsibility to both the buyer and seller. Doesn’t a Realtor’s ethical code disallow this situation? In any other industry, these types of scenarios are labeled as conflict of interest or simply not allowed. Hell, I can’t even accept gifts, a box of See’s candy, yummy, from vendors because my firm forbids it and it puts forward the appearance of me giving favoritism to certain vendors because of the gifts they provide. Some of my vendors even offer me vacations, but I cannot accept.
But real estate seems to be…..different…….sorry, wrong word…..special, in their dealing with ethical situations. It’s almost like an ethical code exists, Realtors stamp it on their chest, proclaim loudly from the hilltops that they follow it, but at the end of the day, it’s just another stack of papers that gets thrown in the back of their Lexus.

-David

State laws can be stricter than federal laws. If we want this change here in WA state, all it would take is someone to write the bill and someone in the legislature to sponsor it.

This takes an investment of time and money.

I do NOT believe we are likely to see see any money coming from the large trade organizations to make this change.

Plus, there’s just too much to know with the ever changing guidelines in the mortgage industry these days plus adding staying on top of the RE market? “A Jack of all trades…a master of none”.

Where there’s smoke there’s usually fire.

I have a hard time understanding why Ira would have been dealing with dual agency more than one time … can you explain your circumstances?

And, if a real estate agent is also an appraiser, I see no conflict of interest, so long as the agent is not appraising any of his/her own transactions for buyers or sellers.

S-Crow, hope you’re skiing today.

She pushed me to get an ARM loan when fixed rate loans were rock bottom and were likely to go up. She also steered me to get the most expensive house I could qualify for.

So, I’m a little unhappy based on what I know these days. However, I did know NOT to get an ARM when fixed rate loans were at historical levels. Also, I was not greedy to get the biggest house I could get.

Buyer beware…and I feel sorry for all of those people who didn’t know any better and got suckered into subprime loans, ARMs, whatnot, and houses they can’t afford.

As the listing agent, they are trying to get the highest price for their seller. As the buyer’s agent, they should be looking out for the buyers and try to get the lowest price. How they can honestly do this in an ethical capacity simply baffles me. That’s a clear conflict of interest.