^{UNDERSTANDING AGENCY RELATIONSHIPS}

What is Agency?
By law, agency is a specific relationship between two or more people. One person must authorize the other person to act on his/her behalf, and the other person must consent to do so. In other words, when you authorize a REALTORŪ to work for you in buying or selling a property and the REALTORŪ agrees, you and the REALTORŪ are in an agency relationship. As a member of the public, you are probably familiar with working with individual REALTOR'SŪ. However, the agency relationship is actually between you and the REALTOR'SŪ brokerage. The brokerage is the real estate company. Therefore, when you hire your agent, the law of agency says that you hire the entire brokerage. In Michigan, REALTORSŪ practice four different forms of agency. A brief description of each follows.

• Seller Agency – in this relationship, the licensee works only for the seller, owing the seller client loyalty, confidentiality and a good faith effort to find a buyer for the property.

• Buyer Agency – in this relationship, the licensee works only for the buyer, owing the buyer client loyalty, confidentiality and a good faith effort to find a property for the buyer.

• Dual Agency – in this relationship, the licensee acts as the agent for both the seller and the buyer in the same transaction, with the consent of all parties. Real estate companies have buyer and seller clients; it is not always possible to predict when a buyer client will choose to buy a property from a seller client. While this may put the agent in the middle, it does assure that sellers have the greatest exposure for their properties and that buyers can make selections from the entire market. A dual agent must provide services fairly without promoting either party's interests over the other.

• Transaction Coordinator – in this relationship, the licensee provides communication or document preparation services, or similar real estate related services without being an agent or advocate for either the seller or the buyer. A transaction coordinator could not disclose the fact that the seller will accept a price less than the asking price, or any other information deemed confidential