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New
Jersey Consumer Information Statement
CONSUMER INFORMATION STATEMENT ON NEW JERSEY REAL ESTATE
RELATIONSHIPS
In New Jersey, real estate licensees are required to disclose how
they intend to work with buyers and sellers in a real estate
transaction. (In rental transactions, the terms “buyers” and
“sellers” should be read as “tenants” and “landlords,”
respectively.)
1. AS A SELLER’S AGENT OR SUBAGENT, I, AS A LICENSEE, REPRESENT THE
SELLER AND ALL MATERIAL INFORMATION SUPPLIED TO ME BY THE BUYER
WILL BE TOLD TO THE SELLER.
2. AS A BUYER’S AGENT, I, AS A LICENSEE, REPRESENT THE BUYER AND ALL
MATERIAL INFORMATION SUPPLIED TO ME BY THE SELLER WILL BE TOLD TO
THE BUYER.
3. AS A DISCLOSED DUAL AGENT, I, AS A LICENSEE, REPRESENT BOTH
PARTIES, HOWEVER, I MAY NOT WITHOUT EXPRESS PERMISSION, DISCLOSE
THAT THE SELLER WILL ACCEPT A PRICE LESS THAN THE LISTING PRICE OR
THAT THE BUYER WILL PAY A PRICE GREATER THAN THE OFFERED PRICE.
4. AS A TRANSACTION BROKER, I, AS A LICENSEE, DO NOT REPRESENT
EITHER THE BUYER OR THE SELLER. ALL INFORMATION I ACQUIRE FROM ONE
PARTY MAY BE TOLD TO THE OTHER PARTY.
Before you disclose confidential information to a real estate
licensee regarding a real estate transaction, you should understand
what type of business relationship you have with that licensee.
There are four business relationships:
1. seller’s agent;
2. buyer’s agent;
3. disclosed dual agent; and
4. transaction broker.
Each or these relationships imposes certain legal duties and
responsibilities on the licensee as well as on the seller or buyer
represented. These four relationships are defined in greater detail
below. Please read carefully before making your choice.
SELLER’S AGENT
A seller’s agent WORKS ONLY FOR THE SELLER and has legal
obligations, called fiduciary duties, to the seller. These include
reasonable care, undivided loyalty, confidentiality and full
disclosure. Seller’s agents often work with buyers, but do not
represent the buyers. However, in working with buyers a seller’s
agent must act honestly. In dealing with both parties, a seller’s
agent may not make any misrepresentations to either party on matters
material to the transaction, such as the buyer’s financial ability
to pay, and must disclose defects of a material nature affecting the
physical condition of the property which a reasonable inspection by
the licensee would disclose.
Seller’s agents include all persons licensed with the brokerage firm
which has been authorized through a listing agreement to work as the
seller’s agent. In addition, other brokerage firms may accept an
offer to work with the listing broker’s firm as the seller’s agent.
In such cases, those firms and all persons licensed with such firms,
are called “sub-agents.” Sellers who do not desire to have their
property marketed through sub-agents should so inform the seller’s
agent.
BUYER’S AGENT
A buyer’s agent WORKS ONLY FOR THE BUYER. A buyer’s agent has
fiduciary duties to the buyer which include reasonable care,
undivided loyalty, confidentiality and full disclosure. However, in
dealing with sellers, a buyer’s agent must act honestly. In dealing
with both parties, a buyer’s agent may not make any
misrepresentations on matters material to the transaction, such as
the buyer’s financial ability to pay, and must disclose defects of a
material nature affecting the physical condition of the property
which a reasonable inspection by the licensee would disclose.
A buyer wishing to be represented by a buyer’s agent is advised to
enter into a separate written buyer agency contract with the
brokerage firm which is to work as their agent.
DISCLOSED DUAL AGENT
A disclosed dual agent WORKS FOR BOTH THE BUYER AND SELLER. To work
as a dual agent, a firm must first obtain the informed written
consent of the buyer and the seller. Therefore, before acting as a
disclosed dual agent, brokerage firms must make written disclosure
to both parties. Disclosed dual agency is most likely to occur when
a licensee with a real estate firm working as a buyer’s agent shows
the buyer properties owned by sellers for whom that firm is also
working as a seller’s agent or sub-agent.
A real estate licensee working as a disclosed dual agent must
carefully explain to each party that, in addition to working as
their agent, their firm will also work as the agent for the other
party.
They must also explain what effect their working as a disclosed dual
agent will have on the fiduciary duties their firm owes to the
buyer and to the seller. When working as a disclosed dual agent, a
brokerage firm must have the express permission of a party prior to
disclosing confidential information to the other party. Such
information includes the highest price a buyer can afford to pay and
the lowest price a seller will accept and the parties’ motivation to
buy or sell. Remember, a brokerage firm acting as a disclosed dual
agent will not be able to put one party’s interests ahead of those
of the other party and cannot advise or counsel either party on how
to gain an advantage at the expense of the other party on the basis
of confidential information obtained from or about the other party.
If you decide to enter into an agency relationship with a firm which
is to work as a disclosed dual agent, you are advised to sign a
written agreement with that firm.
TRANSACTION BROKER
The New Jersey Real Estate Licensing Law does not require licensees
to work in the capacity of an “agent” when providing brokerage
services. A transaction broker works with a buyer or a seller or
both in the sales transaction without representing anyone.
A
TRANSACTION BROKER DOES NOT PROMOTE THE INTERESTS OF ONE PARTY OVER
THOSE OF THE OTHER PARTY TO THE TRANSACTION. Licensees with such a
firm would be required to treat all parties honestly and to act in a
competent manner, but they would not be required to keep
confidential any information. A transaction broker can locate
qualified buyers for a seller or suitable properties for a buyer.
They can then work with both parties in an effort to arrive at an
agreement on the sale or rental of real estate and perform tasks to
facilitate the closing of a transaction.
A transaction broker primarily serves as a manager of the
transaction, communicating information between the parties to assist
them in arriving at a mutually acceptable agreement and in closing
the transaction, but cannot advise or counsel either party on how to
gain an advantage at the expense of the other party. Owners
considering working with transaction brokers are advised to sign a
written agreement with that firm which clearly states what services
that firm will perform and how it will be paid. In addition, any
transaction brokerage agreement with a seller or landlord should
specifically state whether a notice on the property to be rented or
sold will or will not be circulated in any or all Multiple Listing
System(s) of which that firm is a member.
YOU MAY OBTAIN LEGAL ADVICE ABOUT THESE BUSINESS RELATIONSHIPS FROM
YOUR OWN LAWYER. THIS STATEMENT IS NOT A CONTRACT AND IS PROVIDED
FOR INFORMATIONAL PURPOSES ONLY.
ACKNOWLEDGEMENT OF RECEIPT OF CONSUMER INFORMATION STATEMENT
FOR SELLERS AND LANDLORDS
“By signing this Consumer Information Statement, I acknowledge that
I received this Statement from Joseph & Johnna Zarroli of Island
Realty Group to discussing my motivation to sell or lease or my
desired selling or leasing price with one of its representatives.”
Signed
_________________________________________ Date
________________________
FOR
BUYERS AND TENANTS
“By signing this Consumer Information Statement, I acknowledge that
I received this Statement from Joseph & Johnna Zarroli of Island
Realty Group prior to discussing my motivation or financial ability to
buy or lease with one of its representatives.”
Signed
_________________________________________ Date
________________________
DECLARATION
OF BUSINESS RELATIONSHIP
We, Joseph C Zarroli & Johnna M. Zarroli, as authorized
representatives of Island Realty Group intend, as of this time, to work
with you as a:
(indicate one of the following)
_____ seller’s agent only
_____ buyer’s agent only
_____ seller’s agent and disclosed dual agent if the
opportunity arises
_____ buyers agent and disclosed dual agent if the opportunity
arises
_____ transaction broker only
_____ seller’s agent on properties on which this firm is acting as
the seller’s agent and
_____ transaction broker on other properties
Date:
Property:
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