Representation
Representation in real estate refers to the legal and fiduciary relationship between a real estate agent or broker and their client, where the agent acts on behalf of the client's best interests. This relationship establishes duties of loyalty, confidentiality, disclosure, obedience, reasonable care, and accounting. The agent is legally bound to prioritize their client's interests above all others, including their own commission.
Example
“The buyer's agent explained that their representation meant they would advocate solely for the buyer's interests throughout the home purchase process.”
Memory Tip
Think 'RE-present' - your agent RE-presents your interests to others in the deal.
Why It Matters
Understanding representation helps buyers and sellers know whose interests their agent is legally required to protect, which affects the advice, negotiation strategy, and confidential information sharing throughout the transaction.
Common Misconception
Many people incorrectly assume that any agent showing them properties automatically represents their interests, when in fact the agent may be representing the seller unless a buyer representation agreement is signed.
In Practice
A buyer's agent with signed representation agreement must disclose if a property has known foundation issues, even if it might kill the deal. Without representation, that same agent working for the seller would have no duty to volunteer this information to the buyer.
Etymology
From Latin 'repraesentare' meaning 'to bring before' or 'to exhibit,' reflecting how an agent brings their client's interests before others in transactions.
Common Misspellings
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