Here is the scoop on what it all means...

• Number Four Complaint from Homebuyers and Sellers
• What is the Relationship between agents and their brokerage firms?
• How are commissions split?
• Here's the Scoop on the different types of licenses
• Agency Rules & Disclosures Have Changed
• Buyers & Sellers Disclosed Limited Agency Agreements
• Here is the new Oregon Real Estate Agency Disclosure Pamphlet

Buyers and sellers don't understand the relationship between agents and their brokerage firms, have no clue about how commissions are split, and don't distinguish between types of real estate licenses. They are also unclear about what an agency relationship means. Agents need to do a better job of explaining their responsibilities to their clients. Focus 2000 research indicated that although the client wants the agent to act in the client's best interest, a big concern is that the agent it in it for the money. Industry participants need to do a better job of educating the consumer about how the business works. 

This has all changed as of July 2002. You can read more on the license law changes below under The Scoop on the different types of licenses.  

There are new types of agent relationships now and they all depend on the transaction & situation. That is why the new Oregon Real Estate Agency Disclosure Pamphlets are so important as they spell out the relationships of realtors to their clients. 

If a property is listed with another firm - then every one is a single agent. The listing agent & listing firm works for the seller exclusively and the selling agent & selling firm work for the buyer exclusively. 

However, not so clear is the relationship between agents and their brokerage firms. Most agents will be either disclosed limited agents or designated agents and they owe 3 new duties to their clients:

1. To disclose a conflict of interest in writing to all parties;
2. To take no action that is adverse or detrimental to either party's interest in the transaction; and
3. To obey the lawful instruction of both parties.

When different agents associated with the same real estate firm establish agency relationships with different parties to the same transaction, only the principal broker (the broker who supervises the other agents) will act as a Disclosed Limited Agent for both the buyer and seller. The buyer's agent and the seller's agent within the firm will be designated agents and the owe the same 3 new duties to their clients.

The principal broker is responsible for overseeing all actions of his agents and to make sure all agency & license laws are being followed and his agents are acting in the best interests of their clients. 

Confusing? You better believe it is and since this is all so very new - not everyone has implemented these new policies yet so be careful. 

Most listings are sold with a listing company & agent and a Selling company & Buyer's agent. Typical real estate commissions are 6% to 7% of the list price. The Listing Company typically gets half and the Selling company gets the other half. Then the listing company splits that in half - and the listing agents gets 1.5%. Same as the selling agent or the buyer's agent. 

1.5% on a 100,000 sale is only $1500 - not much money for a whole lot of work. And definitely not the $6,000 most sellers think they are paying for just one person. 

Typically more than half of the sales fall through and most Realtors make less than $30,000 a year. And they handle some of the most stressful and difficult transactions that would make most people faint. Have you hugged your Realtor today? 

Everything as we know it changed as of July 2002 - all real estate sales associates are now being called Associate Brokers (temporary Associate Brokers ). All real estate sales associates are required to take a 30 hour transition course by July 2005 to become permanent Associate Brokers. 

Basically our industry is making the shift from Entrepreneur to Professional. Licenses are much harder to get and the tests are much more involved and difficult to pass. We are raising the standards expected of Realtors which is a great thing. 

All previous Brokers are now Real Estate Brokers or they can be Principal Brokers if they take 150 Hour transition course & pass a required test (which hasn't even be written yet). This goes the same for Associate Brokers, Real Estate Brokers, & Designated Brokers. Principal Brokers are the only ones that can oversee the other agents within the real estate office and must have extra course work & tests to do so. Previous Broker exams where much more detailed and extensive more coursework & test were required and the new exams will be the same.

All the old agency disclosure forms have been replaced with a OREGON REAL ESTATE AGENCY DISCLOSURE PAMPHLET which can be read in full by clicking here.

This pamphlet is required to be given at first contact. If you contact a Realtor about a property - they are required to give this to you. We do this by including the pamphlet in all of our Buyer & Seller Packages and by listing it on our to_get_access.htm page on all of our web sites. 

Why haven't you seen one of these? Well - numerous reasons. There are plenty of agents out there that do not take their job as a full time career. There are also plenty of agents that haven't taken the new License Law Updates Classes. 

Why do we make sure everyone who accesses our web sites see this? Cause it is very important you know what an agent can do for you and can't do for you. Especially if it is the listing agent you have contacted. 

We work most often as a Buyer's agents but there are times when we will have a listing that interests a buyer we are working with - especially since the majority of our sellers almost always agree to help with a buyer's home loan closing costs &/or would consider a lease with an option to purchase since we have arranged for home loans that will allow you to refinance into a home after 12 months on a lease option. There still has to be appraisal to prove the property's value & you still have to qualify - but they are easier to qualify for and we have 12 months to clear up any credit problems or pay off any debts to get you to qualify and hopefully the value of the home will go up during that time. We also have these available for self-employed buyers & stated income loans. So it is a win-win situation and those are our specialty. 

We feel this is the single most important form on our web site and we want you to have the information you need to make informed choices. 

When you decide you want to work with an agent - you will need to fill out a agency agreement for a buyer or a seller or both - if you are a buyer and a seller. And you will need to decide what type of agency relationship with your Realtor that you want to have. 

See form for Buyers

See form for Sellers

This pamphlet is required to be given to you as of July 2002 when the Realtor first realizes that you may be a potential client. We believe that you should have this pamphlet as soon as possible. If you have any questions or comments - please email us right away - info@t-crealty.com - We are here to help you.

OREGON REAL ESTATE AGENCY
DISCLOSURE PAMPHLET
OAR 863-015-215 (4)

This pamphlet describes agency relationships and the duties and responsibilities of real estate licensees in Oregon. This pamphlet is informational only and neither the pamphlet nor its delivery to you may be construed to be evidence of intent to create an agency relationship.

Real Estate Agency Relationships
An "agency" relationship is a voluntary legal relationship in which a real estate licensee (the "agent"), agrees to act on behalf of a buyer or a seller (the "client") in a real estate transaction.

Oregon law provides for three types of agency relationships between real estate agents and their
clients:

1. Seller's Agent -Represents the seller only;
   
2. Buyer's Agent -Represents the buyer only;
   
3. Disclosed Limited Agent -Represents both the buyer and seller, or multiple buyers who want to purchase the same property. This can be done only with the written permission of both clients.

The actual agency relationships between the seller, buyer and their agents in a real estate transaction must be acknowledged at the time an offer to purchase is made. Please read this pamphlet carefully before entering into an agency relationship with a real estate agent.

View the full pamphlet here: www.livinginklamathfalls.com/oregon_agency_disclosure_pamphlet.pdf 

No matter whom they represent, an agent must disclose information the agent knows or should know that failure to disclose would constitute fraudulent misrepresentation. Unless agreed to in writing, an agent acting under a Disclosed Limited Agency agreement has no duty to investigate matters that are outside the scope of the agent's expertise.

You are encouraged to discuss the above information with the agent delivering this pamphlet to you. 

If you intend for that agent, or any other Oregon real estate agent, to represent you as a Seller's Agent, Buyer's Agent, or Disclosed Limited Agent, you should have a specific discussion with him/her about the nature and scope of the agency relationship. 

Whether you are a buyer or seller, you cannot make a licensee your agent without their knowledge and consent, and an agent cannot make you their client without your knowledge and consent.

__________________________

This pamphlet is required to be given to you as of July 2002 when the Realtor first realizes that you may be a potential client. We believe that you should have this pamphlet as soon as possible. If you have any questions or comments - please email us right away - info@t-crealty.com - We are here to help you.