The Consumer Information Statement NJ (CIS), defines how the relationships between the Realtor and their client(s) are defined. In addition, it defines what information a Realtor can disclose. Specifically, to either their clients or the clients on the other side of the transaction. Basically, there are four types of relationships Realtors and clients can have. Read on to learn about them.
Seller’s agent works only for the seller. The Realtor has legal obligations, called Fiduciary Duties, to the seller. The duties include reasonable care, undivided loyalty, confidentiality and full disclosure.
A buyer’s agent works for (you guessed it) the seller. The same fiduciary duties apply to the buyer’s agent.
Disclosed Dual Agent
Here, the realtor represents both the buyer and the seller. In order to work as a dual agent, the Realtor’s firm must obtain consent from both the buyer and seller, in writing. Here’s an example of this. When a Realtor shows a property to a buyer that the Realtor, or the firm, is also the seller’s agent. In effect, the Realtor’s agency is working for both parties. In addition, the agency cannot put one party’s interests above the other.
A transaction broker works with a buyer, a seller or both parties in a transaction. However, the transaction broker does not represent either party. Additionally, the transaction broker cannot put one party’s interests above the other. Also, they are required to treat all parties honestly and competently. However, they are not required to keep all information confidential. A transaction broker serves primarily as a manager of the transaction to communicate information between the parties. The goal is to assist them in reaching a mutually acceptable agreement.
The Other Reason
Remember where I said there are two reasons we hand out the CIS? I think I defined the first reason rather well. Now, here’s the second reason.
If a Realtor does not provide a copy of the CIS to a potential client, the NJ Real Estate Commission can levy an $11,000 fine on the Realtor. And, the NJ Real Estate Commission sends employees who pose as buyers out to meet Realtors.
This is why we hand the CIS out every time we meet a potential client.
The above is a brief summary of the NJ Consumer Information Statement. For full details you should carefully read the entire document. If you would like a copy of the CIS, contact me and I’ll be glad to send you one.