Dual Agency in Real Estate – What Every Home Buyer and Seller Should Know About Their Real Estate Agent’s Interests

Wheaton real estate lawyersPeople often assume that a real estate agent is there to represent them and their interests. Sadly, this is not always the case. Neither state or federal law prohibits a real estate agents from having conflicting interests, and some exploit that loophole to the fullest extent possible. Learn more about “dual agency” among real estate agents, including how it could affect your next real estate transaction, and discover how our seasoned Wheaton real estate attorneys can minimize the risks. 

Dual Agency in Real Estate – What It Is and Why It Matters

In an ideal world, a real estate agent would work with only the buyer or the seller – never both. Sadly, dual agency is extremely common among agents. In this scenario, the agent provides services to both the buyer and the seller, and that allows them to keep the entire commission. In short, the only interests they are representing are their own, and that can create all kinds of issues in a real estate transaction. 

As an example, consider a situation in which the seller informs the agent that they recently learned of some foundation issues with the house. Instead of disclosing the full extent of the details to potential buyers of the house, the agent may then downplay the severity of the issue. As a result, the buyer loses money on a house that is unfairly priced.

Avoiding Dual Agency in Your Next Real Estate Transaction 

The one key thing that buyers and sellers can do to protect themselves from the consequences of dual agency is to ensure they know whose interest their agent is serving. Ask them, point blank, if they are representing you exclusively, and if they have a fiduciary duty to do so. These are known as single agents. Other types of real estate agents – most of which you will want to avoid – include subagents, who work with the buyer but have a duty to the seller; transactional agents, who facilitate the transaction but have no responsibility to either party; and dual agents, who are somehow supposed to represent the interests of both parties in a real estate transaction. 

Our Wheaton Real Estate Lawyers Can Protect Your Interests in a Sale or Purchase 

Finding a single agent can be difficult, so not all buyers and sellers can rely solely on the ability to do so. Instead, know that there are other ways to protect your interests during the purchase or sale of a home. The seasoned DuPage County real estate lawyers at Stock, Carlson, Oldfield & McGrath, LLC can help. Call 630-655-2500 to schedule your consultation today.

Source:

https://www.chicagotribune.com/classified/realestate/ct-re-1223-kenneth-harney-20181223-story.html

 

Should You Partner with Your Children to Invest in Real Estate?

DuPage County real estate lawyersFamily businesses can be a way for parents and children to bond, while also offering children a chance at a future they might not have otherwise had. Real estate investment is a different breed of family business, though. There are pitfalls that can leave you holding the debt and all that comes with it. This risk increases even further if you happen to have an adult child who is not quite ready to take on the responsibility. Does this mean you should not invest with your children? Not necessarily. The following can help you determine which decision may be best for your situation.

Taking an Honest Look at Your Child's Maturity Level

During the recession, a lot of real estate investors went under. Others flourished. What made the difference? It was often the ability to make sound, strong, and wise investment decisions. So, when wondering if you should partner with your children to invest in real estate, the first question you should ask is whether it is a sound and smart decision. You know your children best, so only you can truly answer this, but some things to look out for might include:

  • An unwillingness to help themselves (not working extra hours or finishing college courses, even though you are paying for them, etc.);
  • A refusal to take responsibility for basic daily living tasks (cleaning, cooking, laundry, etc.);
  • Poor use of time or other resources;
  • Any form of criminal activity;
  • Rebellious behavior or a general lack of respect for authority;
  • Addiction or gambling problems; and
  • A general lack of self-motivation.

Real Estate Investment with Adult Children Can be Rewarding

When children are responsible, ready to take on the extra task, and are willing to put for the extra effort to make it work, investing in real estate with your children can be a positive experience. It can provide them with a general sense of responsibility, can help alleviate some of the pressure off you (especially when it comes to completing physically arduous tasks), and can leave your child with a wonderful business long after you are gone. In some cases, it may even set your child up for the kind of employment independence and freedom that many people desperately crave.

How to Get Started

It is important to keep in mind that no parent should enter real estate investing with their child blindly. This is especially true for those that do not have a lot of hands-on investing experience. Instead, contact Stock, Carlson, Oldfield & McGrath, LLC for guidance and assistance. Our dedicated and experienced DuPage County real estate attorneys can provide you with sound counsel. In every situation, we will protect your interests. To learn more about how we can help, call 630-665-2500 and schedule your consultation with us today.

Source:

http://time.com/money/page/parents-adult-children-financial-support/

 

Understanding and Managing the Risks in a "For Sale by Owner" Real Estate Purchase

Wheaton, IL real estate attorneysThere are a number of reasons that you may want to purchase a home that is being sold by the owner. It could be that the property has everything you have been looking for, or it could simply be a desire to complete an expedient purchase. Whatever the case, there are some risks that you should be aware of, and some factors you should consider, when purchasing a "for sale by owner" (FSBO) property. These risks and factors – and how you can effectively manage them – are outlined in the following information.

You May Have to Do Some Leg Work

Real estate agents are paid (and trained) to do a lot of the leg work for both the buyer and the seller. A FSBO owner, though interested in selling their property, does not have the same knowledge or experience, which means they may fail to provide you with important information. This oversight may not necessarily be intentional, but it is something you should be aware of. Furthermore, FSBO owners may lack the organizational skills needed to complete paperwork in a timely manner.

Be prepared for possible delays and never agree to anything until you have done your homework. At the very least, this should include an investigation on any previous insurance claims filed on the home, a market analysis of the area, research on zoning details and specific details of the property, and an experienced real estate attorney who can protect your interests by examining the contract and other details of the transaction.

Managing Your Escrow

When you purchase a home through a real estate agent, the escrow that goes toward your down payment is sent to a bank or other neutral entity. Buyers and sellers do not have to "do" anything extra to ensure this payment is secure. In a FSBO transaction, far too many prospective buyers make the mistake of giving the owner the escrow amount. This can result in all kinds of legal issues. Avoid this pitfall by searching for a neutral third-party who is willing to hold the earnest deposit until the process is complete.

Inspections and Contracts

When it comes to possible missteps in a FSBO transaction, there are two major ones that buyers often make: failing to effectively vet the home inspector and not hiring an attorney to review the contract. In a best case scenario, these two mistakes could cost you thousands of dollars in repairs or in remedying legal details surrounding the purchase. Worst case scenarios are frightening and can include everything from learning that the home you purchased has a major issue (electrical problems, severe water damage, black mold, etc.) to finding out that there are years' worth of back taxes owed on the property. Do not become victim to these circumstances! Hire a "vicious" inspector that will check every nook and cranny and always contact a real estate before signing a contract.

At Stock, Carlson, Oldfield & McGrath LLC, we protect the interests of our clients in FSBO real estate transactions. Able to provide knowledge, experience, and skilled assistance in areas pertaining to contracts, home inspections, zoning issues, and more, we are prepared to help you effectively and efficiently navigate the details of your real estate purchase. For more information, contact our Wheaton, IL real estate attorneys today. Call 847-934-6000.

Source:

http://www.wsj.com/articles/SB126279945872118145