The biggest financial transaction of your life may involve buying or selling a home. Since most people aren’t particularly familiar with the process, it’s only natural to rely pretty heavily on your real estate agent’s guidance. You have every right to expect your agent to be knowledgeable, honest and true to your interests. Unfortunately, that’s not always what happens.
Real estate agents have certain legal and ethical obligations to their clients. When an agent doesn’t uphold their obligations, that failure may amount to professional negligence (malpractice).
Common examples of real estate agent negligence
When an agent fails to exercise reasonable care or violates the fiduciary duty owed to a client, they may be liable for any resulting financial losses. Some examples of real estate agent malpractice might include:
- Failing to disclose known problems: An agent trying to offload a problematic property may fail to disclose to a buyer things like serious water damage, structural defects, foundation issues, mold, infestations or other material issues with a property that are part of required disclosures.
- Misrepresenting a property: Sometimes an agent doesn’t just omit information about a property that could affect its value or marketability but actively chooses to give buyers inaccurate information. Other times, inaccurate data is conveyed through sheer carelessness. Information about a home’s square footage, boundary lines, zoning restrictions or other important details can all influence a buyer’s decision.
- Missing critical deadlines: Real estate contracts all have deadlines. Inspections, financing and other contingencies all have to be done on time. An agent’s failure to communicate those deadlines or adhere to them could cost a client their deposit or other legal issues.
- Failing to convey offers: An agent may think an offer is too low, but they still have an obligation to communicate that offer to the seller. If they do not, that can cause the seller to miss their chance.
- Concealing conflicts of interest: Your real estate agent is supposed to have your best interests at heart. They may not be able to do that if their loyalties are divided due to financial or personal relationships with other parties involved in the deal.
- Failing to follow instructions: An agent who disregards a client’s instructions about offers, negotiations or other critical matters may be in violation of their professional obligations.
It’s wise to remember that a poor outcome to a situation doesn’t automatically mean that an agent was negligent. Generally speaking, to have a professional negligence claim succeed, you must show that your real estate agent owed you a certain duty of care, breached that duty and caused you actual financial damages as a result.
Real estate agents aren’t expected to guarantee a perfect transaction – but they are expected to uphold certain standards. An attorney can help you understand if you have grounds upon which to file a related claim.
