State Regulation
The State of California Department of Real Estate (DRE) regulates the real estate industry. The DRE issues licenses for Real Estate Brokers and Sales Agent. Sales agents must work under the license of a Broker. Agents and Brokers can join the National Association of Realtors (NAR). NAR members ore called Realtors. Multiple Listing Service
Realtors join together and form a local board of Realtors. The homes listed for sale are posted on a database called the Multiple Listing Service (MLS). When soneone wants to sell their house, they sign a Listing/Sales Contract with a Realtor. The Realtor can then post their house on the MLS.When someone wants to buy a house, they contact a Realtor who can search the MLS database for the home that suits the buyer's needs. You can search the same database by connecting to it through my link to Listingbook. Agency
The listing agent is the "Seller's Agent" and the buyer is represented by the "Buyer's Agent." If the Listing Agent also represents the buyer, the agent is considered a "Dual Agent." Various processes
Your Realtor is a professional who can guide you through the selling/buying processes. Most transactions involve buyers and sellers negotiating the price and terms, through their respective agents. The financing, appraisals, inspections, disclosures, repairs (if any), title search, loan documents, funding of loans, payoff of loans, prorating taxes and insurance, binding new insurance, recording of documents and many other issues that may arise are necessary to properly complete the transaction. An escrow company processes the information and documents according to the instructions in the selling/buying contract. Escrow companies are neutral and do not represent either party of the transaction. The Realtor's Role
The Realtors are most visible at open houses and when they are taking clients to see houses. They help the parties reach an agreement on a property. The transaction goes to escrow. While the buyer and seller go home to pack and get ready to move, the Realtor is still very busy. The Realtor must follow the transaction through each step of the escrow. There are mandatory disclosures and deadlines to meet. A deal can fall apart very easily if it is not being carefully monitored throughout the entire process. If it is mismanaged and the buyer defaults, the buyer could lose out on getting the house and could also lose some or all of the good faith deposit. Your Realtor can give you advice and suggestions. But remember, you are the one who must make the decisions. We as Realtors are only an agent on your behalf. You must decide the issues for yourself. Realtor's know lenders, escrow officers, title agents, tax attorneys, real estate attorneys, accountants, etc. A Realtor can explain the function of other professionals, but your Realtor is not the authority on these matters. Realtors have contact with numerous vendors; home inspectors, termite inspectors, plumbers, electricians, air conditioning installers, movers, landscapers, etc. Your Realtor can refer you to local professionals and vendors. Realtors are a valuable resource. Do not hesitate to ask about the process or any other issues that come to mind. The Sales Commission
The standard practice in California is for an agent to work for a commission. The Listing agent and homeowner/seller determine the sales commission that will be paid on the transaction. That amount will be deducted from the seller's proceeds at close of escrow. The commission that is finally paid is split several ways. Both the listing broker and selling broker receive a portion to cover the office overhead. The advertising and marketing expenses must all be covered. Then the selling agent and the buyer's agent each receive their portion of the commission. The agent must pay their marketing and business expenses from their commission check. |