The large syndication style companies (such as Zillow and the like) are not individual agents. They resource out there leads to individual agent. They have no duties or obligations to you as a client whatsoever. The person that would have those obligations to you would be the agent that directly is working for you in many cases they’re paying 35% to 40% of the commission they receive to the company that sent them the referral.
You will not find many agents that are seasoned and have a lot of knowledge of the area working under a scenario where there will be paying a 35% referral fee. They have put enough effort and time into the business to learn what they need to know about how to represent clients. By working smartly they certainly will have better opportunities to self properties without making those kind of expense payments.
To actually find out what agents are required to do, here is the duties of a licensee from the state of Nevada, lets see what they say about what agents have to do and how to act. The state of Nevada’s website shows what the duties of a real estate agent or realtor actually is.
Duties of licensee acting as agent in real estate transaction. A licensee who acts as an agent in a real estate transaction:
1. Shall disclose to each party to the real estate transaction as soon as is practicable:
(a) Any material and relevant facts, data or information which the licensee knows, or which by the exercise of reasonable care and diligence should have known, relating to the property which is the subject of the transaction.
(b) Each source from which the licensee will receive compensation as a result of the transaction.
(c) That the licensee is a principal to the transaction or has an interest in a principal to the transaction.
(d) Except as otherwise provided in NRS 645.253, that the licensee is acting for more than one party to the transaction. If a licensee makes such a disclosure, he or she must obtain the written consent of each party to the transaction for whom the licensee is acting before he or she may continue to act in his or her capacity as an agent. The written consent must include:
(1) A description of the real estate transaction.
(2) A statement that the licensee is acting for two or more parties to the transaction who have adverse interests and that in acting for these parties, the licensee has a conflict of interest.
(3) A statement that the licensee will not disclose any confidential information for 1 year after the revocation or termination of any brokerage agreement entered into with a party to the transaction, unless he or she is required to do so by a court of competent jurisdiction or is given written permission to do so by that party.
(4) A statement that a party is not required to consent to the licensee acting on behalf of the party.
(5) A statement that the party is giving consent without coercion and understands the terms of the consent given.
(e) Any changes in the licensee’s relationship to a party to the transaction.
2. Shall exercise reasonable skill and care with respect to all parties to the real estate transaction.
3. Shall provide the appropriate form prepared by the Division pursuant to NRS 645.193 to:
(a) Each party for whom the licensee is acting as an agent in the real estate transaction; and
(b) Each unrepresented party to the real estate transaction, if any.
4. Unless otherwise agreed upon in writing, owes no duty to:
(a) Independently verify the accuracy of a statement made by an inspector certified pursuant to chapter 645D of NRS or another appropriate licensed or certified expert.
(b) Conduct an independent inspection of the financial condition of a party to the real estate transaction.
(c) Conduct an investigation of the condition of the property which is the subject of the real estate transaction.
Now that you’ve actually read what realtors have to do, it is really clear they have to take care of the general public and their client. When an agent breaches those obligations, they are subject to penalty and correction through the state of Nevada. We believe it is very important for agents to take their business seriously to the conduct for the public and adhere to the rules the state requires. We fully support any and all efforts to do so.
Does this description apply to a corporation? We know you would think it would. The answer is no, it is not required and they may try to police the people they refer business to. The real answer is they never see anything about the transaction at all. They only know if a lead they send out actually results in a check to them for the referral. If that is happening then they will send that person more and more leads.
The other way that works is the agents pay for the space on the site to have their name be there for the referral. As long as the money keeps rolling in they will be their local expert. I will agree the agent is investing in the opportunity and has an interest in doing a great job. Most of the time it is the agent that signs up first very often they know nothing about any given area at all. But it is important to understand what you are really looking at. The big question is this the person that will take care of me and has the knowledge to be able to take care of me.