Client Confidentiality
In real estate deals there is an agency pamphlet that Oregon agents are required to hand to their clients, there are several bullet points, one of which is to keep their client’s information confidential. Unfortunately, I see this important tenet of agency violated constantly.
The point about confidentiality is item number nine on the list of agent duties in the pamphlet. All the prior duties can, in my opinion, be summed up by: Do your best for your client as their agent, tell your client what you know, work on their behalf, and don’t pretend you know something when you really don’t. It’s all pretty simple. Yet somehow this seems to fall apart for a lot of agents when it comes to item number nine, the duty to maintain your client’s confidential information.
The following are a few examples.
Earlier this fall I was representing a buyer, and discussing a property of interest with a well-known listing agent. This home was not listed as a short sale, there was no indication of distress. The other agent offers up: “this seller is in such financial difficulty, he is just having a really hard time focusing on keeping the property in showing condition”. Well that was interesting, I had *no clue* this was a distressed sale, but I sure did after that comment. If my client had decided to open up negotiations on this sale this information would have definitely factored in to their offer.
Another example occurred recently when I was representing a seller, and a cash offer had just come in. To show proof of funds, to prove the ability to purchase the property, the buyer’s agent offers the closing statement from the property the buyer recently sold. The closing statement showed the “cash to seller” from that transaction was far in excess of the amount needed to purchase my client’s property. Worse yet, the offer to us was written at a low price, but armed with this handy bit of information from the buyer’s agent we knew just how important an amount like $25,000 might be to that buyer (not that important!). Based on the information we wrote a counter offer with confidence and shockingly (ahem) the transaction went together just fine.
What should my colleagues have done differently to better represent their clients? In the first case, *don’t say anything at all!*. So many agents talk incessantly, it seems they sometimes don’t realize the importance of what they are saying. Does your agent have the “gift of gab”, as they say? Are you sure it’s a “gift”? It may not be when it comes to your confidential information.
In the second case, the client would have been much better represented if the buyer had gone to their banker for a letter stating that the amount required for the offer was available in their account. This tactic would have left the seller with doubts as to whether or not the buyer even *could* go higher, let alone whether or not the buyer had plenty of excess cash! It would have been much more likely that the seller’s counter offer would not have been so bold but more accommodating.
Finally, there is a third example that is even more tragic than the other two. Again, I was showing a house to a buyer client. After the showing, when the listing agent followed up with me for feedback I explained that my clients liked the house, and it was near the top of their list. “Oh good” she said, “because these people really need the money, they have serious health problems and really need to sell.” Ouch. I felt really bad for her clients, who else might she have told! My client didn’t end up choosing that home, but in the event they did I would have had the duty *by law* to share that information with them! Again, on this listing there was absolutely no indication of distress other than what the listing agent verbally shared with me.
Are you absolutely certain your agent is not sharing your confidential information with the world? If you’re already in an agency relationship, you might want to ask your agent their thoughts on this subject. If you’re not currently in an agency relationship, you might want to choose an agent that is sensitive to these issues when you’re considering which agent to work with.
--Ward Spears
(503) 522-8269
wspears@equitygroup.com
www.Portlandrealestate.net
