In its simplest form, fiduciary refers to a trust.
Loyalty
A duty of loyalty is one of the most fundamental fiduciary duties owed by an agent to his principal. This duty obligates a real estate broker to act at all times solely in the best interests of his principal to the exclusion of all other interests, including the broker’s own self-interest. A corollary of this duty of loyalty is a duty to avoid steadfastly any conflicts of interest that might compromise or dilute the broker’s undivided loyalty to his principal’s interests. Thus, a real estate broker’s duty of loyalty prohibits him from accepting employment from any person whose interests compete with, or are adverse to, his principal’s interests. A classic example of breach of this duty of loyalty by a real estate broker is a broker who purchases property listed with his firm and then immediately resells it at a profit. Such conduct ordinarily is perfectly appropriate and lawful by persons acting “at arm’s length.” But a fiduciary will be deemed to have “stolen” a profit opportunity rightfully belonging to his principal and thus to have breached his duty of loyalty.
Confidentiality
An agent is obligated to safeguard his principal’s confidence and secrets. A real estate broker, therefore, must keep confidential any information that might weaken his principal’s bargaining position if it were revealed. This duty of confidentiality precludes a broker representing a seller from disclosing to a buyer that the seller can, or must, sell his property below the listed price. Conversely, a broker representing a buyer is prohibited from disclosing to a seller that the buyer can, or will, pay more for a property than has been offered. CAVEAT: This duty of confidentiality plainly does not include any obligation on a broker representing a seller to withhold from a buyer known material facts concerning the condition of the seller’s property or to misrepresent the condition of the property. To do so would constitute misrepresentation and would impose liability on both the broker and the seller.
Disclosure
An agent is obligated to disclose to his principal all relevant and material information that the agent knows and that pertains to the scope of the agency. The duty of disclosure obligates a real estate broker representing a seller to reveal to the seller:
- All offers to purchase the seller’s property.
- The identity of all potential purchasers.
- Any facts affecting the value of the property.
- Information concerning the ability or willingness of the buyer to complete the sale or to offer a higher price.
- The broker’s relationship to, or interest in, a prospective buyer.
- A buyer’s intention to subdivide or resell the property for a profit.
- Any other information that might affect the seller’s ability to obtain the highest price and best terms in the sale of his property.
A real estate broker representing a buyer is obligated to reveal to the buyer:
- The willingness of the seller to accept a lower price.
- Any facts relating to the urgency of the seller’s need to dispose of the property.
- The broker’s relationship to, or interest in, the seller of the property for sale.
- Any facts affecting the value of the property.
- The length of time the property has been on the market and any other offers or counteroffers that have been made relating to the property.
- Any other information that would affect the buyer’s ability to obtain the property at the lowest price and on the most favorable terms.
CAVEAT: An agent’s duty of disclosure to his principal must not be confused with a real estate broker’s duty to disclose to non-principals any known material facts concerning the value of the property. This duty to disclose known material facts is based upon a real estate broker’s duty to treat all persons honestly and fairly. This duty of honesty and fairness does not depend on the existence of an agency relationship.
Obedience
An agent is obligated to obey promptly and efficiently all lawful instructions of his principal. However, this duty plainly does not include an obligation to obey any unlawful instructions; for example, an instruction not to market the property to minorities or to misrepresent the condition of the property. Compliance with instructions the agent knows to be unlawful could constitute a breach of an agent’s duty of loyalty.
Reasonable care and diligence
An agent is obligated to use reasonable care and diligence in pursuing the principal’s affairs. The standard of care expected of a real estate broker representing a seller or buyer is that of a competent real estate professional. By reason of his license, a real estate broker is deemed to have skill and expertise in real estate matters superior to that of the average person. As an agent representing others in their real estate dealings, a broker or salesperson is under a duty to use his superior skill and knowledge while pursuing his principal’s affairs. This duty includes an obligation to affirmatively discover facts relating to his principal’s affairs that a reasonable and prudent real estate broker would be expected to investigate. Simply put, this is the same duty any professional, such as a doctor or lawyer, owes to his patient or client.
Accounting
An agent is obligated to account for all money or property belonging to his principal that is entrusted to him. This duty compels a real estate broker to safeguard any money, deeds, or other documents entrusted to him that relate to his client’s transactions or affairs.
FIDUCIARY DUTIES
Title Insurance
Title Insurance
Title Insurance
Our title insurance policies protect buyers and lenders from potential title defects. We are committed to providing the highest quality title insurance services to our clients.
Title Searches
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Title Insurance
Our team of experienced professionals conducts comprehensive title searches to ensure that all title issues are resolved prior to closing. We provide accurate and reliable title search services to our clients.
Escrow Services
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Title Clearance
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We work closely with our clients to identify and resolve any title issues that may arise. Our team is committed to providing the highest quality title clearance services.
Fiduciary Duty
REALTORS®’ DUTY TO PUT CLIENT INTERESTS ABOVE THEIR OWN
A REALTOR® is a special kind of real estate agent: one who follows NAR’s strict Code of Ethics, including the first and primary pledge to protect and promote the interests of their clients. This obligation means that a REALTOR® cannot make decisions or provide representation in a way that puts their own interests or commissions ahead of their clients’ interests.
REALTORS DUTY TO PUT CLIENT INTERESTS ABOVE THEIR OWN
What does it mean for a REALTOR to act in a BUYER'S best interest?
A REALTOR® has an ethical duty to tell a buyer about every timeshare ownership available for sale that meets their criteria. That means that REALTORS® will let you know about all available properties, regardless of whether the seller or listing broker is offering compensation to your buyer’s agent—even if compensation offered by a seller or listing broker is less than what you agreed to pay your agent in your written buyer agreement.
What does it mean for a REALTOR® to act in a SELLER’s best interest?
A REALTOR® should explain to their seller the benefits and costs of the various types of marketing that can be done for a listing, and how potential buyers might respond to such marketing. A REALTOR® is ethically prohibited from telling a seller that their home will be hidden from buyers unless the seller pays a particular type or amount of compensation.
What is wrongful “steering”?
The REALTOR® Code of Ethics prohibits “steering” buyers toward homes because the REALTOR® will be paid more, or away from homes because the REALTOR® will be paid less. Similarly, the REALTOR® Code of Ethics prohibits a REALTOR® from telling a seller that buyers will be “steered” toward homes because the REALTOR® will be paid more, or away from homes because the REALTOR® will be paid less.
How do written agreements protect me from steering?
As of August 17, 2024, you will be asked to sign a written buyer agreement before touring a home with the professional you want to work with. NAR’s ethical rules have long encouraged REALTORS® to enter into written agreements with their clients because these agreements promote clarity and transparency. They also help protect you from wrongful “steering” by specifying the amount of compensation the REALTOR® will receive and the services they will provide. Since a broker working with a buyer receives the amount the buyer has agreed to, the amount of any offer of compensation is irrelevant to the buyer-broker’s compensation. Our team of experienced professionals can perform a thorough title search to ensure that the property you are interested in is free of any legal encumbrances or defects. We use the latest technology to ensure accuracy and speed.