This is the last post in our series about the fiduciary duties of a REALTOR®. We’ve covered the first 4 standards, and today we’ll do the last two letters of the acronym OLD CAR (Obedience, Loyalty, Disclosure, Confidentiality, Accountability and Reasonable Care/Diligence).
ACCOUNTABILITY: A REALTOR® must be able to account for all money and documents that have been entrusted to him/her by the client (principal). This includes things such as safe keeping a check for “earnest money” given by a buyer as part of an offer to buy or rent. It also includes safe keeping of deeds and documents given to the REALTOR® during the process of selling, buying or renting a property. In some situations there are specific requirements for what must be done, such as putting certain funds into an escrow account rather than co-mingling them with other accounts.
REASONABLE CARE AND DILIGENCE: A REALTOR® is assumed to have greater real estate skills and expertise than the average person. He/she is expected to use these skills and expertise in the client’s best interests. This doesn’t mean that a REALTOR® can give guidance about legal or other matters outside of the scope of a competent real estate professional. Lawyers, accountants, engineers and other professionals have skill sets that may be needed in a real estate transaction, and a REALTOR® should not represent the client in areas such as those.
A reasonable and prudent real estate professional does many things that may not be obvious to the client (principal). The purchase or sale of a property involves a considerable portion of the client’s net worth, so the REALTOR® and the client need to have a relationship of trust. I hope this series of articles on fiduciary duties has been helpful for you.
Note: I wrote this article; these are my personal views and do not necessarily reflect the views of Diane Turton, Realtors.