In the early 1980s, consumer advocates complained and the National Association of Realtors recommended that practitioners adopt a practice of disclosing their responsibility to the seller.

That practice raised the buyers' awareness of the issue, causing more buyers to seek representation, wrote Walt Albro in the February, 1998 issue of  Today's Realtor.  But, most states did not have laws recognizing buyer representation or buyer agency.

In 1993, NAR's Board of Directors adopted a list of nine recommendations that states considering realty law revisions might wish to consider. With the recommendations available to use as a legislative framework, states across the nation began revising their laws.

Today, the vast majority of states have rewritten real estate laws.

The laws typically address the agency issue and outline how real estate professionals should perform their duties under the terms of Buyer, Seller, and Dual Agency.

Regardless of the agency designation, agents are required:

• To help their client obtain the best price and terms possible.
• Safeguard and account for any money handled for the client.
• Be Loyal to the client and follow reasonable and lawful instructions.
• Act with reasonable skill, care and diligence.
• Disclose any information that might influence the client's decision to buy or sell.

At the heart of most agency requirements is communication. Upon first substantial contact with a client, the real estate professional is required to disclose in writing their and their firm's relationship with the client.

Buyer Agency

Real estate consumers now have the option of contracting with an agent/firm for exclusive representation. The agent is bound by law to assist his client in obtaining the best possible price and terms. The buyer agent cannot disclose any confidential or personal information about the buyer to the seller or sellers' agent.

The buyer agent is obliged to:

• Obtain and deliver a buyer agency disclosure statement to the buyer-client. The buyer agency agreement should state how the buyer should enter into a buyer agency agreement with the agent and how the buyer's agent will be paid.
• Have the buyer sign the disclosure statement, noting the date and time of delivery. Give the buyer a copy and return the copy with the original signature on it to the listing agent.
• Discuss the disclosure statement with the buyer to see if there are any areas of concern that may require extra inspections.
• If the buyer has not received the disclosure statement, the buyer-agent must advise that buyer of his/her right to cancel the contract.

The year is 1988 and Joe T. Buyer attends an open house. Mr. Buyer meets an agent (the sellers' agent) at the open house and later views several more houses with the agent. Mr. Buyer decides to make an offer on one of the houses. The buyer tells the agent that they have been transferred from another state and need to be in the new house in less than a month so their child will be ready to begin the new school year.

The agent, acting legally and ethically, (since they are obligated to serve the seller) tells Susan M. Seller of Mr. Buyer's need to close quickly.  (The problem....Ms Seller now has the upper hand in negotiations.)

It is now 2000. The scenario is the same, but Mr. Buyer has taken advantage of revised real estate laws and has signed an exclusive buyer agency agreement with the agent. The Ms Seller has no knowledge of Mr. Buyer's need to close quickly, and the agent can use his/her knowledge and experience to advise Mr. Buyer during the negotiating process.

Purchasing real estate is no longer a lonely experience. The buyer now may have a professional on his side.

Seller agency basically places real estate professionals in a role similar to the one they filled before the laws were rewritten. They represent the seller and are obligated to help their client obtain the best price and terms.