Agency Disclosure in Michigan

The law in Michigan requires real estate brokers and agents to disclose their agency status. Translation: who does the agent actually work for? Much of the time, all agents, whether they are the listing agent, who has a listing contract with the seller and is marketing the home, or the selling agent, who is helping the buyer find homes, are working for the seller. This is the same status that has been used for about a hundred years. Under this status all fiduciary responsibilities (read loyalty and duty) required of the agents is to the Seller. The buyer is owed honesty and fairness in all areas of the transaction, but the agents work in the best interests of the Seller. This is called Seller Agency.

In recent years it has evolved that the selling agent works on behalf of the buyer and owes fiduciary responsibility to the buyer, thus working in the best interests of the Buyer. This involves the agent and the buyer entering into a written buying contract, in which the buyer agrees to buy a home through the agent regardless of who has it listed (even for sale by owners). The buyer may give the agent a deposit that is applied to the buyers costs to buy the home if purchased through the agent, or forfeited if not. This is Buyer Agency. (more info)

A third form of agency is Dual Agency. This occurs when a buyer's agent sells a home listed by the same broker that the agent works for. Both buyer and seller have to agree to have the agents work under this agency, which provides limited fiduciary responsibilities to either party.

For a more complete explanation of agency I will provide you a copy of "Disclosure Regarding Real Estate Agency Relationships". For a copy just email me your name and address and I'll send one snail-mail right away. We will have to discuss the agency I will be working under with you before we get into the process. You will be asked to sign an acknowledgment that you understand my agency status. This is not a contract for anything, just you acknowledging I talked to you about agency.

By the way, this is a good time to ask: Have you signed any other agreements of any kind with any other brokers? It's OK if you did, don't panic! You just need to disclose this information to any agents you may be working with. They need to know what and when, if any, for both your sakes.