WORKING WITH A TENNESSEE REAL ESTATE PROFESSIONAL
(Initial Disclosure as Required by Tennessee License Law)
Tennessee Real Estate License Law requires the disclosure of the following information at first "substantive contact" with a prospective consumer of real estate services.
Every Real Estate Licensee owes the following duties to every Buyer and Seller, Tenant, and Landlord (collectively "Buyers" and "Sellers"):
1. To use professional skill and care in providing services;
2. To disclose any adverse facts (any significant property defects, or information that a party will not fulfill contractual obligations) of which Licensee has actual notice or knowledge;
3. To maintain the confidentiality of any information obtained from you (other than adverse facts which must be disclosed) prior to the Licensee's disclosure of an agency relationship with someone in a transaction. This responsibility continues after any agency relationship and/or after the closing of the transaction;
4. To provide services with honesty and good faith;
5. To provide timely and accurate information, by request, on market conditions related to a transaction;
6. To account
for earnest money deposits and other property received from any party to a
A) To not engage in self-dealing, conflicts of interest, or representation of a family member
or other entity in which the Licensee has a prior interest, without prior disclosure.
B) To refrain from recommending - without proper disclosure - the use of another business in which the Licensee has an interest or from which the Licensee may receive a referral fee.
If the Licensee has become an Agent or Designated Agent in a transaction, the Licensee has ALL of the above duties AND two additional duties to his/her Client:
8. To obey all lawful instructions of the Client within the scope of the agency agreement between the Licensee and Client; and
9. To be loyal to the Client's interests by placing those interests before all others in negotiation of a transaction and in other activities, as long as the Licensee does not violate any of the basic duties owed to all consumers.
NOTE: EVERY REAL ESTATE LICENSEE SHALL MAINTAIN THE CONFIDENTIALITY OF ANY INFORMATION RECEIVED FROM YOU BY THE LICENSEE PRIOR TO THE LICENSEE'S DISCLOSURE TO YOU OR A WRITTEN AGENCY OR SUBAGENCY AGREEMENT TO REPRESENT ANYONE IN A TRANSACTION TO WHICH YOU MAY BE A PARTY, EXCEPT FOR ADVERSE FACTS REQUIRED TO BE DISCLOSED UNDER TENNESSEE LAW.
AN EXPLANATION OF TERMS
Facilitator (not an agent for either party):
The licensee's company is not working as an agent for either party in this consumer's prospective transaction. This licensee is therefore neutral and cannot serve as an advocate or advisor for either party in the transaction. (By law, any licensee or company who has not entered into a written agency agreement with either party in the transaction is considered a Facilitator until such time as an agency agreement is established.
Designated Agent for the Seller:
The individual licensee is working as an agent for the seller or property owner in this consumer's prospective real estate transaction, to the exclusion of all other licensees in his/her company. Even if someone else in this licensee's company represents a possible buyer for this seller's property, the Designated Agent for the Seller will continue to work as an advocate for the best interests of the seller or property owner. An agency relationship of this type cannot, by law, be established without a written agency agreement
Designated Agent for the Buyer:
The individual licensee is working as an agent for the buyer in this consumer's transaction (or prospective transaction), to the exclusion of all other licensee in his/her company. Even if someone else in this licensee's company represents a seller in whose property this buyer is interested, the Designated Agent for the Buyer will continue to work as an advocate for the best interests of the Buyer. An agency relationship of this type cannot, by law, be established without a written agency agreement.
By law every licensee is obligated to protect some information as confidential, other than any adverse facts which must be disclosed. Confidential information includes any facts revealed by a consumer which may be helpful to the other party IF they were revealed by the consumer BEFORE the licensee disclosed an agency relationship with that other party. AFTER the licensee discloses that he/she has an agency relationship with another party, any such information which the consumer THEN reveals must be passed on by the licensee to that other party.
UNLESS YOU HAVE AN AGREEMENT THAT BOTH YOU AND THE LICENSEE HAVE SIGNED THAT EMPLOYS THAT LICENSEE AS YOUR AGENT, THEN THAT AGENT IS LEGALLY WORKING AS A FACILITATOR AND CANNOT LAWFULLY PERFORM DUTIES AS YOUR AGENT
ONLY A WRITTEN, BI-LATERAL AGREEMENT CREATES A LAWFUL AGENCY IN TENNESSEE.
A DISCLOSURE OR CONFIRMATION OR AGENCY DOES NOT FULFILL THIS REQUIREMENT.
ALL REALTORS HAVE PLEDGED TO FOLLOW AND ABIDE BY THE CODE OF ETHICS AND STANDARDS OF PRACTICE OF THE NATIONAL ASSOCIATION OF REALTORS®.
A COPY OF THAT DOCUMENT MAY BE FOUND AT http://KAARMLS.COM/coe.htm
Realty Executives Associates
10255 Kingston Pike
Knoxville, TN 37922
Toll Free 1-800-662-2488
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