Why Hire a Realtor?
Many often use the terms REALTOR® and real estate agent interchangeably, but there are many differences any prospective home buyer or seller should know.
While both are licensed to sell real estate, the rudimentary difference between a real estate agent and a REALTOR® is a REALTOR® is a member of the National Association of REALTORS®. Under NAR, a REALTOR® must subscribe to the REALTOR® Code of Ethics.
The Code of Ethics is a set of 17 Articles and various underlying Standards of Practice that are strictly enforced. More than just a directory of rules that agents swear to uphold and adhere to, the standards are much more restrictive and confining as to conduct than governing agents who simply hold a real estate license.
While there is no evidence nor guarantee that all REALTORS® are morally and ethically better than unaffiliated real estate agents, it is an attempt by the industry to regulate and, as such, deserves recognition.
17 Standards REALTORS® MUST uphold vs Regular Licensed Agents:
- Pledge to put the interests of buyers and sellers ahead of their own and to treat all parties honestly.
- REALTORS® shall refrain from exaggerating, misrepresenting or concealing material facts; and is obligated to investigate and disclose when situations reasonably warrant.
- Shall cooperate with other brokers / agents when it is in the best interests of the client to do so.
- Duty to disclose if they represent family members who own or are about to buy real estate, or if they themselves are a principal in a real estate transaction, that they are licensed to sell real estate.
- Shall not provide professional services in a transaction where the agent has a present or contemplated interest without disclosing that interest.
- Shall not collect any commissions without the seller’s knowledge nor accept fees from a third-party without the seller’s express consent.
- Shall refuse fees from more than one party without all parties’ informed consent.
- Shall not co-mingle client funds with their own.
- Shall attempt to ensure that all written documents are easy to understand and will give everybody a copy of what they sign.
- Shall not discriminate in any fashion for any reason on the basis of race, color, religion, sex, handicap, familial status, or national origin.
- Expects agents to be competent, to conform to standards of practice and to refuse to provide services for which they are unqualified.
- Must engage in truth in advertising.
- Shall not practice law unless they are a lawyer.
- Shall cooperate if charges are brought against them and present all evidence requested.
- Agree not to bad mouth competition and agree not to file unfounded ethics complaints.
- Shall not solicit another REALTOR’S client nor interfere in a contractual relationship.
- Shall submit to arbitration to settle matters and not seek legal remedies in the judicial system.
The National Association of REALTORS® was founded in 1908 and has more than one million members. To qualify for membership, an agent must agree to adhere to NAR’s strict code of ethics and standards of practice. The official ethics code is revised yearly to reflect the latest issues in real estate law and practice, and its core message is to “treat all parties honestly” [source: National Association of Realtors]. Although the primary responsibility of a buying or selling agent is to his or her client, Realtors promise never to mislead or withhold information from anyone involved in the real estate transaction — including the other real estate agent and his or her clients.
The NAR ethics code is what separates Realtors from non-member real estate agents. Although the study of ethical principles is included in many state education and licensing programs, the NAR code obligates Realtors to follow the code of ethics and standards of practice that we discussed earlier. Part of the incentive for becoming a Realtor is to capitalize on the good reputation of NAR members. The idea is that consumers will opt to work with a real estate agent who has sworn to treat all parties fairly and honestly.
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