Legal Advice And Your Real Estate Agent
The ideal time for you to engage an attorney is prior to signing the brokerage agreement with the realtor. That way you get the benefit of having the brokerage agreement properly negotiated, and so that your realtor properly understands that your lawyer is a part of your team. This is particularly important in Missouri, where many realtors are not accustomed to interacting with attorneys, except when a deal goes bad and is in jeopardy or lawsuits are being threatened. Introducing them to a lawyer to can work with the realtor to get the deal to closing is an important first step in solidifying your team.
Realtors and independent real estate brokers are, more often than not, just trying their best in what is a very difficult profession. The law, however, sets them up to be in difficult positions, and this creates confusion and mistrust for the client.
To illustrate this point:
You surely wouldn’t be upset if you went to the electronics store to buy a new computer, were helped by a friendly salesperson, and then went home to think about it only to return later than evening to learn that the very same salesperson sold the computer to somebody else…after all, that’s their job!
With a real estate agent, however, buyers and sellers are provided with representation in the form of an agent who is well-dressed and generally well-educated, who presents them with legal documents and who explains the process and gets the necessary signatures while referring to them as clients. This is not because they are trying to deceive you, it is because the law and regulations, while categorizing brokers and agents as salespeople who are permitted to represent both sides of a deal, or even to represent parties who are competing for the same property or the same buyers, also gives them certain fiduciary duties to clients, thus putting them in an ever-awkward position.
Due to no fault of their own, this pulls them in opposite directions. Should they push the sale through even if it’s bad for the client? Should they keep negotiating down even if it means they might lose their commission? Both brokers / agents and the clients are the victims of this dual characterization of their jobs.
Lawyers, by contrast, are held to a strict duties of “loyalty” and “zealous representation” which force them to remain objective, where realtors cannot be. If problems come up between you and your realtor during the course of the contract period or even afterwards, having an attorney in your corner familiar with the laws of brokerage can also be invaluable. If the deal is in danger, your lawyer can try to save the deal without his/her payment being attached to that, and, if necessary, can try to get you out of the deal and minimize your liability exposure for walking away.
Having your own attorney also allows realtors to do their job. The vast majority of real estate agents are honest and very hard-working. Due to the appearance and process described above, however, many clients expect the real estate agent to answer their questions about the contract and provide the type of advice only a lawyer is permitted to provide.
If they do provide such advice they can get into serious trouble for “practicing law without a license,” a crime they can be prosecuted for because it is dangerous to the public. Relieving the agent of this pressure will let them focus on helping you find the right house or a buyer for your own house that is up for sale, and on keeping adequate track of all the timelines in the agreement. We work with many real estate agents and brokers, and we hope to work with yours as well.
Do yourself and your agent a favor: Get Your Own Attorney.