If you were a defendant in a court case, would you hire the prosecuting attorney to represent you? Of course not. So why would you do the equivalent in real estate.
Dual agency is illegal in some states, and if it were up to me it would be illegal everywhere. How can one agent really represent and give the best advise to both sides of the transaction? Sure there are some good agents, some good friends of mine, who practice dual agency. I am not saying they are doing anything wrong, but I don’t think the consumers are really thinking about it.
I used to think dual agency in short sales was alright because really it was the buyer and the seller against the bank. But then I saw things go wrong. We do not, and will not practice dual agency. In a short sale there are many things that can go wrong for the seller with approvals, contributions required, deficiency language, all things that you need to make sure your agent is looking out for your best interest.
Just think of this scenario for a moment. You are considering short selling your home and interviewing agents, as you should. One of the agents comes up to you and says they work with an investor who will put an offer in on your house day one. You don’t need to worry about showing, you don’t need to worry about the buyer sticking around and you don’t need to worry about the house going to foreclosure because a buyer cannot be found.
Sounds great right?
now step back a moment and think about it some. This agent has this investor he works with. They probably have offers on dozens of houses and there is a good chance after the investor buys this house they will use the agent to list and sell the house. If there is a gray issue, who do you think the agent is really going to look out for the most. Do you think the agent is likely to do anything that may upset this investor who does dozens of deals with?
Now things may go smoothly, but in the end if I were short selling my house I would want someone I know was loyal to me.
We currently have three houses under contract where the current buyer came to us and asked us to write the offer. We declined and all three are currently represented by another agent. We could have taken the full commission, but we think it is more important to make sure without a doubt we are doing everything we can can for our client, the seller, to fully represent them.