In the State of Nevada real estate agents have specific duties they are required to provide to all parties and more specifically to the client with whom they are representing. These duties are clearly defined on the Duties Owed By a Nevada Real Estate Licensee. This form is provided to all clients, in every real estate transaction and is a required document by the State of Nevada.
To all parties in a short sale the agent must act in a manner which is not deceitful, fraudulent or dishonest, while exercising reasonable skill and care. The agent must also disclose to each party in the transaction all material and relevant facts.
Reasonable skill and care would require the agent to seek training on short sales as they are much more complex transactions than a regular purchase or sale. The agent should be familiar with marketing strategies for short sales, the short sale process, bank requirements, and diligently follow up through the transaction. The agent must disclose to each party material facts – what lien holders are involved, has a Notice of Default or Sale been filed against the property, what is the homeowner’s hardship. In addition to any other facts that might be pertinent – are their other liens, is the agent using an 3rd party negotiator, is the seller current or delinquent, is this the seller’s primary residence, does the seller qualify for HAFA? These are all material and relevant facts in a short sale.
In addition, the agent is charged with additional duties to their client – the buyer or the seller.
- Exercise reasonable skill and care – again the agent should seek education on short sales.
- Not disclose confidential information without written consent of the client – in a short sale transaction the seller authorizes the agent to discuss confidential information with the seller’s lien holder.
- Seek a sale, purchase…at the price and terms stated in the brokerage agreement or price acceptable to the client. This is done through agents listing the property in MLS, marketing the property etc.
- Present all offers made to, or by the client as soon as practicable, unless waived by client. The listing agent has the obligation to present all offers made to the seller. If the seller accepts an offer then subsequent offers should be presented for back up position. Only one offer should be forwarded to the seller’s lien holder.
- Disclose to the client material facts of which the licensee has knowledge concerning the real estate transaction. The licensee should inform the seller of the legal and tax implications of a short sale, how the short sale process works etc.
- Advise the client to obtain advice from experts relating to matters which are beyond the expertise of the licensee – it cannot be stressed enough that agents should not be giving legal, tax or credit counseling advice to clients. These are all areas where clients should be referred to a licensed professional.
- Account to the client for all money and property the licensee receives in which the client has an interest. When representing a buyer on a short sale, if the earnest money is not going to be deposited until short sale approval is procured, the agent should clearly identify who has these funds.
Agents should clearly not be giving sellers advice on the legal, tax and credit implications of short sale but directin them to the great FREE resources available in our community. On the buyer's side, agents should be collecting as much information about the short sale as possible to help thier buyer's make informed short sale purchase decisions.
