Real Estate Client vs. Customer Brokerage Relationship – What Does It Mean?

I received an email from Joe asking about brokerage relationships regarding client vs. customer.  Thank you Joe for asking and I’m happy to answer it because if you are not sure then there will be plenty of others who are not sure as well.

Joe asks:  I have been told that brokerage relationships are defined as either client or customer.  Is this true and what is the difference?

Joe, it is true and here’s how it works:

There are two broad categories of brokerage relationships which are: 1) broker-client relationship and 2) broker customer relationship.

Let’s start by explaining:

Broker-Client relationship (key word here is client)
This means the broker is representing a buyer or seller as a client.  Another words, the broker is acting as his or her legal agent in buying, selling or leasing real estate.  In Georgia, this type of relationship can only be formed by the broker and the buyer or seller entering into a signed written agreement. The agreement will explain things such as: how the broker will be paid, broker duties to the client and the type of other agency representation offered by the broker. A key component of this type of relationship is each party pledges their complete loyalty to each other and the agent will represent the client’s best interest within legal and ethical boundaries.

Broker – Customer relationship.  The broker in this case is not representing the buyer or seller in an agency capacity.  The broker may still work with the customer and provide ministerial services.  What are ministerial services? Services for a customer are limited and fairly generic such as:  Broker may identify properties for sale or lease, provide pre-printed real estate contract forms, prepare contracts within the legal instruction of the customer and assist in referring customer to lenders, inspectors, closing attorneys, appraisers, etc. but would not provide client level services such as negotiating on the client’s behalf, provide information that an agent may have about a property which would be advantageous  to the buyer in securing the best deal, offering guidance on making an offer price  and suggesting other negotiating strategies advantageous to the buyer client, etc.

Joe, I hope this answers your question but if you or anyone else reading this needs more information, please be sure to call, text or email me.

Donna Yates
Associate Broker, GRI
706-633-0644 Mobile
donna@ellijay.com
donna@donnayates.com
www.move2northgeorgia.net
www.georgiacabinsforsale.com

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