At what point does an Agents Obligation stop in the process of sale - Your Views

Hello LAM1963,

I find very interesting the questions on your message.

I´ll try to give my point of view (sorry in advance for any mistake, as English is not my mother tongue).

When you decide to buy a property through the services of a real estate agent, you are paying a professional who first of all must look after your purchase process goes correctly. Otherwise you can do that job yourself.

The service you are going to pay should be clearly agreed form the very beginning, which not always happens.

Will the agent just find the property? Will him/her do all the legal and administrative tasks and papers to the full?

All this should be estabished in detail in a sort of "Buyer Agency Agreement" or similar.

I think this is particularly important if you buy an off-plan property and not second handed one. Because many times the Agent will just show you in their office a final selection of projects that could meet  your needs, take you to the promoter/developer project office, let the person of the developer company explain all the info (this person normally knows all about this project better than the agent, which is normal at some point). Maybe the agent will just ask the developer to prepare documents, make an appointment with the client to sign and buy. The Agent will have their commission and then if any problem arise during the building period, the buyer will find more helpfull and practical talking with the promoter directly.

What I am try to say is that to avoid this, the "Buyer Agency Agreement" document should be done at the beginning, with legal obligation to the Agency.

Maybe is a bad example, but when you go to a restaurant, you pay when you go and have already eaten, at the end. If there´s something wrong with the meal or the service while your in the restaurant, your complaints will be listened and solved, as you have not yet paid. But when you buy off-plan through an agent, the promoter/developer will pay the agent, normally a part of the commission when the Private Contract is signed, and a rest when the title deeds are signed at the end. To avoid the Agents dissapearing through the process, this "Buyer Agency Agreement" with legal obligation can help. Some Estate agents use some kind of document, but think is better to sit and discuss exactly what their services will include and will not not.

Regards 

LAM1963,  I am assuming that you speak as a purchaser. In my view, the agents only (and considerable) obligations to the purchaser are to act truthfully , within the law and to do what he/she said he/she would do. But these are what we should expect from any professional or trade person. The agent is surely primarily obligated to the party by whom he/she is contracted, ie the seller and any input after the introduction should be geared towards completing the sale in a speedy and honest manner. In that respect, my experience is that agents normally bow out after exchange of contracts.
I know that many agents offer all sorts of advice and services to oil the wheels, or earn extra income, but I'm not sure I would consider these as obligations. 
I have, in the past, been fooled and indeed burned by being taken in by over zealous and dishonest agents who spoke as if they were acting in my interest. But they were not and upon reflection, I blame myself for being taken in.
A good agent will not do that because the best way to effect a sale that will complete safely and without recourse is to understand what a purchaser really wants and can afford and try to match that requirement. By doing this, the purchaser will benefit, but it is the obligation to the seller that is fulfilled.
No doubt others will disagree and we have professionals on this forum. You may have started an interesting thread!

hI all,

Simple answer,never!

Regards

Georgia

I met the agent we finally bought through nearly 2 years ago.

He has helped us to find a property, a translator, a builder, a bank, a mortgage  and is still in touch about the progress on our renovations even though we completed in January.

I call that service.

We never agreed what he would do. He just helps where and when he can without surcharges for after sales service.

I really do think that the smaller, local agents are the best.

Laury

Not at all laury you keep championing the cause!!!!!

I was always taught that you have to be 3 things to be succesful agent.

To every client you must be a good advisor,a good salesperson and finally a good friend.

I still go to barbecues with clients that i sold to 3 years ago and have become good friends.

The sign of a good agent and something i have always prided myself on is that if you should never have to cross the road to avoid a previous client.

I have to live in the community i work in and so i integrity is always a must.

Regards

Georgia

Georgia,
Everything you say is right and to be applauded. It is good for business. It makes your clients (buyers and sellers) feel good and they will return to you (or ask you to their barbecues!). It also , obviously,makes you feel good and comfortable with yourself.  If only all business was conducted in that way and in the way Lauryc experienced. But it isn't and we all know that. Silly really, that so many sacrifice long term success and their integrity for short term gain.
But the question was about obligations. I took that to mean what does an agent have to do to discharge obligations to the purchaser without standing to be accused of malpractice or neglect and answered on that basis.
Lauryc,
I would be thrilled to receive the service level given to you, but I would consider it over and above the agents actual obligation, which makes it all the sweeter.

I quote from The Leader newspaper " ***** International is the leading Spanish property specialist. We have taken the strain and stress out of buying your ideal home in Spain by offering you the widest possible range of services through all the stages of purchasing, moving in and living here. Our complete service package ranges from the legalities regarding your status in Spain to help you furnish or customize your home. It also involves assistance with insurance, banking renting your property or maintenance of your house during your absence. Our highly qualified after sales team takes care of updating you constantly of any news regarding your new home. They will do a final inspection on completion to ensure the property is ready. We have got more than 300 people working on your behalf. Our aim? To make sure that you are completely satisfied with your decision. ***** International has the largest aftersales service of its kind in Europe. Once you become a client, you are a client for life."

Pretty impressive eh?  Well I bought an off plan house march 2003 - completion June 2004. The house was never built and the house I was offered in exchange I moved into in Jan 2005. I still have no Escatura so cannot sign on the Padron. The urbanisation remains unfinished and ***** International dont want to know.  So in answer to the original question I would have at least expected an Escatura! numero uno. There are many of us in the same position. Perhaps the EOS team would like to ask these particular agents why this is the case. I am sure you know who I am talking about.

As a buyer, I would expect the agent to ensure that the property is all legal and above board, registered to the person selling it etc., and that the seller turns up at the Notary with everything in order to ensure a smooth transaction. Furthermore, I would expect them to ensure after the sale that the seller has fulfilled his obligation to pay any taxes (i.e. plus valia), and if the buyer requires it, to assist in changing names on contracts for utilites etc. (Although I can take care of all that myself and prefer to, so I know it's done, some may need this help).

As a seller, I expect the agent to find me a qualified buyer who actually has the money and isn't just messing around! After that, I would prefer the agent to get lost to avoid screwing things up, which is what they always seem to manage in my experience! I would be happy to simply pay an introduction fee, and then do the selling myself, since I'm better at it than most agents! I would prefer an agent who does as little as possible, but charges less accordingly.

Of course, you could be lucky, and find an agent like Georgia, who seems to charge less but do more!

Hi Plexx,

The answer to your question is so wide open and depends entirely on the agent,legally an agents obligation should continue through to completion,how people interprete completion is another thing.

Some agents will consider completion as the payment of their commision,some will consider it notary,the way it should be considered is when all documents are in place and the customer is satisfied of that fact.

The agent should be your reassurance that the whole process is legal and above board.

The builders do try it on and the easiest way to do business with them is to conform,i say easiest but not the best,i had an example of this at notary when the builder had an outstanding mortgage on a property that had in essence been paid,the only problem was there is a certificate that has to be attached to the escritura to state this.

I was asked if my clients would mind this being forwarded at a later date and they would have probably said yes,to everyone's annoyance i refused and so had to wait six hours for the bank to turn up with the paperwork.

A pain in the arse but a lot lesss hassle that any problems that would have come from this not happening.

So in summary the obligation to the client is totally in the hands of what agent you choose and can be as long or short as they deem their service.

You will have to find an agent with a moral obligation and the best way for that is word of mouth.

Regards

Georgia 

Hello All,

Just got back after a long break, so I thought I would have a go at this one to warm myself up

In the first instance an agent takes a property on his books making the vendor his client at this point.  It goes without saying that the property is checked for all legal and financial information and copies of title deed, nota simple, IBI and utilities kept in the property file at the agents office.  Anyone who does not keep and check out this information is NOT an estate agent!!

Robert is correct in so far as the next job for the agent is to market the property correctly and secure a qualified buyer.  Remember the vendor is paying the agent NOT the buyer.  If it is any other way round, then again he is not an estate agent.

The commission charged should be taken from the value of the property and NOT added on.

Once a buyer is found, the estate agent should supply all the property documents to the buyers lawyer within 24 hrs allowing the lawyer to determin the property is correct and saleable.

The buyers lawer will then inform the agent that his client wishes to proceed and arrange to hold or pass on to the vendors/or vendors lawyer €3000 reserve or the full 10% deposit which is backed up with a purchase contract and signed by both parties or a proxy with POA.

The agent continues to inform and update the vendor with information from the buyer and/or his solicitor ensuring information flows both ways.  The buyer should use their lawyer for mortgages etc.  It is possible to ask the agent for this but the advice could be biased towards his commission, so better to have the lawyer do this.

The agent can attend the completion, however apart from collecting his commission there is no real need to do this unless the vendor needs the agents support.  The buyer has and should depend on their lawyer on the day of the notary.

The buyers lawyer should then ensure the new title deed is registered at the land registry and present a property pack to the buyers within 6-8 weeks containing the registered title deeds, confirmation that all direct debits are set up in the buyers name for utilities, rates/IBI, telephone etc along with reciepts for all taxes paid and the lawyers own bill.

The agent in reality is of no further use to the buyer, vendor or lawyer.  If either party needs to contact the agent for any reason after the sale, this will only be because the lawyer has not done their job correctly. 

There is no need for the buyer to pay the estate agent for a service contract when they have a lawyer doing this work.  The agents job is done.  From the buyers point of view, should they need schools, medical appointments, satelite TV or anything else for that matter my advice is not to use the agent for this as there are many translator services to provide this facility at a reasonable cost until the buyers Spanish improves enough to do it themselves.

In short the buyer should not lean on the agent to do anything other than described above.  From the agents point of view, if they stick to their job they will not mess up!!  Trying to be all things to all people is only going to detract away from the real job in hand.

Regarding the process for new-build, the buyers lawyer should again be the person in charge.  Once the agent has found a new-build property for the buyer, then all documentation should be provided by the developer to the buyers lawyer.  The lawyer should oversee all payments to the developer on behalf of the client.

The same applies at the completion, the buyers lawyer should arrange everything with the developer on behalf of the client.

As Justin said, the agent can keep the buyer updated with photographs and news about the progress of the property/development.  However most  developers usually have an ftp site with their own and often more up-to-date images and news, thus offering perhaps a better flow of information than the agent can provide.

Websites like EOS, thanks to Justin also offer great property forums, although there can often be doom and gloom postings from some individuals, in the main there are many uses of this facilitiy, such as meeting future neighbours, helping each other with photo updates and loads more benefits.

An estate agent who tries to be the legal advisor and financial advisor as well will only find themselves being berated three times instead of one!!  You can tell I have learned my lessons over the past seven years

You sound a little bit cynical Gillespie.

I'm sorry but I think the after sales is still important. Even if the agent just helps to tie you up with a reasonably priced translator.

If the agent's obligatins end at point of sale. How come the big boys like Parador offer an after sales service? There again I suppose it's for the extra cash because they charge a few hundred for the service.

I was talking to our old agent on saturday and we will pop in for a chat over the weekend while we are over in the CB.

I suppose it depends on the type of service that people are looking for?

I wouldn't hesitate in recommending my agent.

Laury

Hi Laury,

I´m not really a cynic, but seven years in the trade has taught me that you can do too much.  I agree with you that if required the agent can offer more services.  But so many people these days assume you are only on the make, trying to get 10% from the referral.  I have never taken a penny commission from banks, lawyers or furniture providers etc.  I would prefer the client to get the extra discount.

If a client asks me to recommend a bank, I usually suggest our company bank because they do very low set up costs for any of our clients, but, I won´t push the client that way unless they ask.

In the past I have bailed client´s cars out of police compounds at 2 in the morning, taken a seriously I´ll client in the middle of the night to Cartagena hospital and even driven to Madrid to collect insulin for a client with diabetis plus 100´s more besides.

But, in those days there were so few alternatives to this service that I felt compelled to do it, and often only too pleased too.  However, and in particular, my area, there are loads of British and Spanish companies offering to do this for very low fees and it´s nice to give them the business instead of doing it myself - horses for courses and all that!

Probably the biggest reason for for my change of policy is that over the last 2 years I have reduced my staff level to it´s lowest possible to keep the business running, and commissions too, and I would just not have the time or facilities to do many of these things now.  But as I say, as these specialist service provider have appeared it makes sense for the client to use them on a professional basis rather than feel guilty they are asking too much of their agent.  In the old days my clients would come in so humbly asking if we would translate a rates bill or letter from the hospital, i would assure them it was no trouble, however these days they can go into a translators office and feel quite happy to get the service they need without guilt of asking.

I still invite my clients to BBQ´s at home and sometimes throw a party in the Plaza with a good singer and nice food and that keeps me in touch long after the sale has completed, also when you do a good job the clients will always pop in to the office say hello when they are passing.  that´s the nicest reward of all.

What a shame that you have become cynical through cynical customers.

I haven't come across these people you are talking about. Are they translators or do they provide more of a service? I'm stumped.

Laury

Hi Laury,

Most refer to themselves as Gestorias.  However a proper Gestoria will usually have a degree in economics.

Some call themselves Legal and Fiscal Advisors or Spanish Property Services or some other play on those words.  If they don´t have an office they usually work from home and advertise in local English language press.

More often than not they will be British, often women with a fluent or fairly fluent grasp of Spanish.  They will spend half a day with you for €50.  I.E . attend doctors surgery, hospital, garage or school etc.

And before smiley chips in here, I don´t think they will spend an evening with you for €50.

Not so sure that I would appreciate an englishwoman spending the night with me to be honest.

A latin hunk would be far more tasty.

I thought Gestorias were more like accountants and helped to sort out tax returns and such? Have I got it all wrong?

Laury