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How you are represented in a real estate transaction

Howyouarerepresented

Required disclosures/forms

Ohio law requires that real estate licensees act as a fiduciary of their client and act in their client’s best interest. In general terms, a licensee’s fiduciary duties include:

  • Exercising reasonable skill and care in representing the client;
  • Performing the terms of any written agency agreement;
  • Following any lawful instructions of the client;
  • Complying with all requirements of the license law, along with other applicable statutes, rules and regulations. Those include the federal and Ohio fair housing laws and the Ohio landlord tenant act;
  • Disclosing to the client any material facts of the transaction of which the licensee is aware or should be aware in the exercise of reasonable skill and care and that are not confidential information under a current or prior agency or dual agency relationship;
  • Advising the client to obtain expert advice related to material matters when necessary or appropriate;
  • Accounting in a timely manner for all money and property received in which the client has or may have an interest; and
  • Keeping confidential all confidential information, unless the licensee is permitted to disclose the information. This requirement includes not disclosing confidential information to other licensees in the brokerage who are not agents of the client.

Duties of a seller’s agent

In addition to their overall fiduciary responsibilities, licensees acting as seller’s agents, whether they are listing agents or subagents, owe these duties to the seller:

  1. To seek an offer to purchase at a price and with terms acceptable to the seller. Unless the seller directs otherwise, the listing agent is not obligated to seek additional offers once the property is subject to a contract of sale, lease or letter of intent to lease;
  2. To present an offer to purchase to the seller in a timely manner, even if the property is subject to a contract of sale, lease or letter of intent to lease; and
  3. To provide the seller with a copy of any agency disclosure form signed by the buyer, prior to presenting the seller with an offer to purchase. Seller’s agents are forbidden from offering subagency to other brokerages or offering compensation to buyer brokers without the seller’s knowledge and consent. But Ohio law specifically permits seller’s agents, whether they are listing agents or subagents, to show alternate properties to buyers and to represent other sellers without breaching their duties to the seller.

Duties of a Buyer’s agent

Licensees acting as buyer’s agents also must fulfill certain duties to their clients. These are in addition to their fiduciary duties described above. Those duties are:

  1. Seeking a property at a price and with purchase or lease terms acceptable to the buyer. Unless the buyer directs otherwise, the buyer’s agent is not obligated to seek additional purchase or lease possibilities if the buyer is a party to a contract to purchase property, or has entered into a lease or has extended a letter of intent to lease; and
  2. Presenting any offer or counteroffer to purchase or lease to the listing agent in a timely manner, even if the property is subject to a contract of sale, lease or letter of intent to lease.
  3. Buyer’s agents are forbidden from offering subagency or accepting compensation from a seller’s agent without the knowledge and consent of the buyer. But a licensee does not breach any duty or obligation to the buyer by showing the same properties to other buyers or by acting as an agent or subagent for other buyers, or as an agent or subagent for sellers, except that any dual agency relationship must be disclosed to a client.