1. In this chapter: >Working for clients and with customers >Duties to clients >Responsibilities to customers >Additional considerations >Undisclosed relationships with vendors >Breach of duties to clients >Fair housing 2. Duties to Clients and Responsibilities to Customers 25

2. WORKING FOR CLIENTS AND WITH CUSTOMERS Agents work for clients and with customers Agents owe duties to their clients and have responsibilities to customers 25

3. WORKING FOR CLIENTS AND WITH CUSTOMERS Relationship between agent and client is legally binding Agents have responsibilities to customers to treat them honestly 26

4. DUTIES TO CLIENTS: OLD CAR 26

5. Duties and Disclosed Dual Agency In states that allow for disclosed dual agency, the duties of confidentiality, undivided loyalty, and full disclosure cannot be reconciled between two clients 28

6. RESPONSIBILITIES TO CUSTOMERS H onesty A ccounting R easonable Skill D isclosure (Material Fact and Agency) 29

7. ADDITIONAL CONSIDERATIONS WHEN WORKING WITH CLIENTS 35

8. BREACH OF DUTIES TO CLIENTS What happens when real estate agents knowingly or unknowingly violate their duties? The term is breach of duty. 38

9. Penalties 39

10. Penalties 39

11. UNDISCLOSED RELATIONSHIPS WITH VENDORS You must disclose any potential financial benefit you or your brokerage firm would receive, beyond referral fees, from the customer or client’s business. 40

12. FAIR HOUSING & BUYER REPRESENTATION Easy way to remember federally protected classes: 40

13. Which Law Prevails? Federal fair housing laws always apply Federally protected classes can be added to, but never removed 41

14. FAIR HOUSING & BUYER REPRESENTATION SUGGESTED SCRIPTS: How to Respond to Fair Housing Issues Buyer: “What is the racial composition of this neighborhood? Do you service any areas that I would feel at home in? What kinds of people live in this neighborhood?” 41

15. FAIR HOUSING & BUYER REPRESENTATION SUGGESTED SCRIPTS: How to Respond to Fair Housing Issues Buyer: “How are the schools in this area? Are they good? Are the schools integrated?” 42

16. FAIR HOUSING & BUYER REPRESENTATION SUGGESTED SCRIPTS: How to Respond to Fair Housing Issues Buyer: “Why don’t you just pick out some nice properties in a safe area for us? Would you live here?” 42

17. Statement of Fair Housing Policy Include fair housing policy language in your buyer representation agreement 43

18. Statement of Fair Housing Policy BRIGHT IDEA: Equal Professional Services Model 43

19. Statement of Fair Housing Policy Real estate professionals who continually evaluate their performance are likely to perform well. Ask yourself questions in Figure 2.7. 43