Working with Real Estate Agents (Lease Transactions)

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WORKING WITH REAL ESTATE AGENTS (LEASE TRANSACTIONS)
NOTE: This form is designed for use by agents working with landlords and/or tenants. It is similar, but not identical, to the “Working with
Real Estate Agents” brochure published by the NC Real Estate Commission (available in letter-length format as NCAR Standard Form
#520), which must be used by agents working with sellers and/or buyers.
When leasing real estate, you may find it helpful to have a real estate agent assist you. Real estate agents can provide many useful
services and work with you in different ways. In some real estate transactions, the agents work for the landlord. In others, the landlord and
tenant may each have agents. And sometimes the same agents work for both the landlord and the tenant. It is important for you to know
whether an agent is working for you as your agent or simply working with you while acting as an agent of the other party.
This brochure addresses the various types of working relationships that may be available to you. It should help you decide which
relationship you want to have with a real estate agent. It will also give you useful information about the various services real estate agents
can provide landlords and tenants, and it will help explain how real estate agents are paid.
LANDLORDS
Landlord’s Agent
If you are leasing real estate as a landlord, you may want to “list” your property for lease with a real estate firm. If so, you will sign
a “listing agreement” authorizing the firm and its agents to represent you in your dealings with tenants as your landlord’s agent. You may
also be asked to allow agents from other firms to help find a tenant for your property.
Be sure to read and understand the listing agreement before you sign it. Your agent must give you a copy of the listing agreement
after you sign it.
Duties to Landlord: The listing firm and its agents must  promote your best interests  be loyal to you  follow your lawful
instructions  provide you with all material facts that could influence your decisions  use reasonable skill, care and diligence, and  account
for all monies they handle for you. Once you have signed the listing agreement, the firm and its agents may not give any confidential
information about you to prospective tenants or their agents without your permission so long as they represent you. But until you sign the
listing agreement, you should avoid telling the listing agent anything you would not want a tenant to know.
Services and Compensation: To help you lease your property, the listing firm and its agents will offer to perform a number of
services for you. These may include  helping you price your property  advertising and marketing your property  giving you all required
property disclosure forms for you to complete  negotiating for you the best possible price and terms  reviewing all written offers with you
and  otherwise promoting your interests.
For representing you and helping you lease your property, you will pay the listing firm a commission or fee. The listing agreement
must state the amount or method for determining the commission or fee and whether you will allow the firm to share its commission with
agents representing the tenant.
Dual Agent
You may even permit the listing firm and its agents to represent you and a tenant at the same time. This “dual agency relationship”
is most likely to happen if an agent with your listing firm is working as a tenant’s agent with someone who wants to lease your property. If
this occurs and you have not already agreed to a dual agency relationship in your listing agreement, your listing agent will ask you to amend
your listing agreement to permit the agent to act as agent for both you and the tenant.
It may be difficult for a dual agent to advance the interests of both the tenant and landlord. Nevertheless, a dual agent must treat
tenants and landlords fairly and equally. Although the dual agent owes them the same duties, tenants and landlords can prohibit dual agents
from divulging certain confidential information about them to the other party.
Some firms also offer a form of dual agency called “designated agency” where one agent in the firm represents the landlord and
another agent represents the tenant. This option (when available) may allow each “designated agent” to more fully represent each party.
If you choose the “dual agency” option, remember that since a dual agent’s loyalty is divided between parties with competing
interests, it is especially important that you have a clear understanding of  what your relationship is with the dual agent and  what the agent
will be doing for you in the transaction.
TENANTS
When leasing real estate as a tenant, you may have several choices as to how you want a real estate firm and its agents to work with
you. For example, you may want them to represent only you (as a tenant’s agent). You may be willing for them to represent both you and
the landlord at the same time (as a dual agent). Or you may agree to let them represent only the landlord (landlord’s agent or subagent).
Some agents will offer you a choice of these services. Others may not.STANDARD FORM 521
Revised 1/2009
© 7/2011
Tenant’s Agent
Duties to Tenant: If the real estate firm and its agents represent you, they must  promote your best interests  be loyal to you 
follow your lawful instructions  provide you with all material facts that could influence your decisions  use reasonable skill, care and
diligence, and  account for all monies they handle for you. Once you have agreed (either orally or in writing) for the firm and its agents to
be your tenant’s agent, they may not give any confidential information about you to landlords or their agents without your permission so long
as they represent you. But until you make this agreement with your tenant’s agent, you should avoid telling the agent anything you
would not want a landlord to know.
Unwritten Agreements: To make sure that you and the real estate firm have a clear understanding of what your relationship will be
and what the firm will do for you, you may want to have a written agreement. However, some firms may be willing to represent you and
assist you for a time as a tenant’s agent without a written agreement. But if you decide to make an offer to lease a particular property, the
agent must obtain a written agency agreement before writing the offer.. If you do not sign it, the agent can no longer represent and assist you
and is no longer required to keep information about you confidential.
Be sure to read and understand the agency agreement before you sign it. Once you sign it, the agent must give you a copy of it.
Services and Compensation: A tenant’s agent will perform a number of services for you. These may include helping you  find a
suitable property  arrange financing  learn more about the property  prepare and submit a written offer to the landlord and  otherwise
promote your best interests. A tenant’s agent can be compensated in different ways. For example, you can pay the agent out of your own
pocket. Or the agent may seek compensation from the landlord or listing agent first, but require you to pay if the listing agent refuses.
Whatever the case, be sure your compensation arrangement with your tenant’s agent is spelled out in a tenant agency agreement before you
make an offer to purchase property and that you carefully read and understand the compensation provision.
Dual Agent
You may permit an agent or firm to represent you and the landlord at the same time. This “dual agency relationship” is most likely
to happen if you become interested in a property listed with your tenant’s agent or the agent’s firm. If this occurs and you have not already
agreed to a dual agency relationship in your tenant agency agreement, your tenant’s agent will ask you to amend the tenant agency agreement
or sign a separate agreement or document permitting him or her to act as agent for both you and the landlord. It may be difficult for a dual
agent to advance the interests of both the tenant and landlord. Nevertheless, a dual agent must treat tenants and landlords fairly and equally.
Although the dual agent owes them the same duties, tenants and landlords can prohibit dual agents from divulging certain confidential
information about them to the other party.
Some firms also offer a form of dual agency called “designated agency” where one agent in the firm represents the landlord and
another agent represents the tenant. This option (when available) may allow each “designated agent” to more fully represent each party.
If you choose the “dual agency” option, remember that since a dual agent’s loyalty is divided between parties with competing
interests, it is especially important that you have a clear understanding of  what your relationship is with the dual agent and  what the agent
will be doing for you in the transaction. This can best be accomplished by putting the agreement in writing at the earliest possible time.
Landlord’s Agent Working With a Tenant
If the real estate agent or firm that you contact does not offer tenant agency or you do not want them to act as your tenant’s agent,
you can still work with the firm and its agents. However, they will be acting as the landlord’s agent (or “subagent”). The agent can still help
you find and lease property and provide many of the same services as a tenant’s agent. The agent must be fair with you and provide you with
any “material facts” (such as a leaky roof) about properties.
But remember, the agent represents the landlord – not you – and therefore must try to obtain for the landlord the best possible price
and terms for the landlord’s property. Furthermore, a landlord’s agent is required to give the landlord any information about you (even
personal, financial or confidential information) that would help the landlord in the lease of his or her property. Agents must tell you in
writing if they are landlords’ agents before you say anything that can help the landlord. But until you are sure that an agent is not a
landlord’s agent, you should avoid saying anything you do not want a landlord to know.
Landlords’ agents are compensated by the landlords.
_________________________________________
Date
Firm Name Agent Name and License Number
Disclosure of Landlord Subagency
 When showing you property and assisting you in leasing a property, the above agent and firm will represent the LANDLORD.
For more information, see “Landlord’s Agent Working with a Tenant” in the brochure.