Working with a REALTOR®
When working with a REALTOR®, it is important to understand who the REALTOR® works for. To whom is the REALTOR® legally obligated?
In real estate, there are different possible forms of agency relationship:
1. Seller's Agent
When a real estate company is a "seller's agent," it must do what is best for the seller of a porperty.
A written contract, called a listing agreement, establishes seller agency. It also explains services the company will provide, establishes a fee arrangement for the REALTOR®'s services and specifies what obligations a seller may have.
Confidences a seller shares with a seller's agent must be kept confidential from potential buyers and others.
Although confidential information about the seller cannot be discussed, a buyer working with a seller cannot be discussed, a buyer working with a seller's agent can expect fair and honest service from the seller's agent and disclosure of pertinent information about the property.
2. Buyer's Agent
A real estate company acting as a "buyer's agent" must do what is best for the buyer.
A written contract, called a buyer agency agreement, establishes buyer agency. I also explains services the company will provide, establishes a fee arrangement for the REALTOR®'s services and specifies what obligations a buyer may have.
Typically, buyers will be obliged to work exclusively with that company for a period of time.
Confidences a buyer shares with the buyer's agent must be kept confidential.
Although confidential information aboutthe buyer cannot be disclosed, a seller working with a buyer's agent can expect to be treated fairly and honestly.
3. Dual Agent
Occasionally a real estate company will be the agent of both the buyer and the seller. The buyer and seller must consent to this arrangement in their listing and buyer agency agreements. Under this "dual agency" arrangement, the company must do what is best for both the buyer and the seller.
Since the company's loyalty is divided between the buyer and the seller who have conflicting interests, it is absolutely essential in written agency agreement. This agreement specifically describes the rights and duties of every involved and any limitations to those rights and duties.
4. Who's working for you?
It is important that you understand who the REALTOR® is working for. For example, both the seller and the buyer may have their own agent which means they each have a REALTOR® who is working for them.
Or, some buyers choose to contact the seller's agent directly. Under this arrangement the REALTOR® is working for the seller, and must do what is best for the seller, but may provide many valuable services to the buyer.
A REALTOR® working with a buyer may even be a "sub-agent" of the seller. Under sub-agency, both the listing agent and the co-operating agent must do what is best for the seller even though the sub-agent may provide many valuable services to the buyer.
If the seller and the buyer have the same agent, this is dual agency and the REALTOR® is working for both the seller and the buyer.
Code of Ethics
REALTORS® believe it is important that the people they work with understand their agency relationship. That's why agency disclosure is included in a self-imposed Code of Ethics which is administered by the Real Estate Council of Ontario. The Code requires REALTORS® to disclose in writing the nature of the services they are providing, and encourages REALTORS® to obtain written acknowledgement of that disclosure. The Code also requires REALTORS® to enter into a written agency agreement with any sellers or buyers thery are representing.
Honesty and Integrity
Most real estate professionals in our province are members of the Ontario Real Estate Association (OREA) and only members of OREA can call themselves REALTORS®.
When you work with a REALTOR®, you cna expect not only strick adherence to provincial laws, but also adherence to a Code of Ethics. And that code is very important to you because it assures you will receive the highest level of service, honesty and integrity.
Highest Professional Standards
Before receiving a real estate license, candidates must successfully complete an extensive cours of study developed by OREA on behalf of the Real Estate Council of Ontario. That is only the beginning: in the first two years of practice, licencees are required to successfully complete three additional courses as part of their articling with an experienced broker. In addition, all licencees must continue to attend courses throughout their careers in order to maintain their licence.
REALTORS® are governed by the legal concept of "agency". An agent is legally obligated to look after the best interests of the person he of she is working for. The agent must be loyal to that person.
A real estate company may be your agent - if you have clearly established an agency relationship with that REALTOR®. But ofter, you may assume such an obligation exists when it does not.
REALTORS® believe it is important that the people they work with understand when an agency relationship exists and when it does not - and understand what it means.
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Types of Mortgages
1. National Housing Act (NHA) mortgages are loans granted under the provisions of the National Housing Act of 1954.
Lenders are insured against loss by the Canada Mortgage and Housing Corporation. Borrowers must pay an applications fee to CMHC (which is usually added to the principal amount of the mortgage, although it may be paid in cash).
2. The coventional mortgage is a loan which does not exceed 75 per cent of the appraised value or purchase price of the property, whichever is the less of the two.
3. The high-ratio mortgage is a conventional mortgage loan which exceeds 75 per cent of the appraised value or purchase price of the property, whichever is the lesser of the two. These mortgages must, by law, be insured if placed with a bank or a trust company.
4. A collateral mortgage is a loan backed up by a promissory note and the security of a mortgage on real property. The money borrowed may be used for the purchase of the property itself or for other purposes, such as home improvements, a vacation, or a business investment.
Terms and Conditions of Mortgages
The First mortgage is the portion of the total debt registered against your property which is secured by first call on the property. In other words, if you default, the holder of the first mortgage has first call on the value of the property in order to revcover the loan.
The Second mortgage is the portion which comes second in line. The interest rate is usually higher to reflect this increased risk to the lender.
The Open mortgage is one which allows the borrower to repay the loan more quickly than agreed, either on anniversay dates or regular monthly payment dates, with or without pre-payment charges.
A Closed mortgage is one which does not allow the borrower to repay the loan more quickly than agreed. Payment must be made as specified in the agreement.
A fixed-rate mortgage is one where the rate of interest is set for a specific period of time (the term of the mortgage, which may be for as many as five years or as few as six months) The monthly payment of principal and interest remains the same throughout the term.
A variable-rate mortgage is one wherethe rate of interest changes from time to time as money market conditions change, but usually no more than once a month.
The leasehold mortgage is a mortgage on a home and / or improvements where the land is rented rather than owned. These mortgages must be amortized over a period that is shorter than the length of the land lease.
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Do you require a market evaluation?
Our Team has valued estate in Windsor and Essex County for over 30 years. Fully knowledgable in market conditions and trends, using different approches to value.
Market evaluations are preformed for may different reasons and purposes.
To discover the current or a subsequent date market value for self satisfaction, mortgages purposes, capital gaines, tax, property assessment appeals, Insurance claims and estates.
We preform these types of purposes for many clients, financial instutions and Solicitors at their request.
Don't be under sold!
To know what happened to values in your area don't hesitate to call Our Team at (519) 326-3712 or email featherstonerealty@bellnet.ca
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