Warning....Are you an Agent or Independent Contractor?
Last Friday I wrote a blog Brokerage Relationship: Which one will you enter into?, which talks about brokerage relationships. In Virginia on 1 July 2012, changes will occur to the agency law. One of those changes are representing a client as an Independent Contractor. It can at first be a bit confusing to us agents and I want to make it clear that I am NOT talking about an independent contractor as it relates to OUR brokerage.
It is NOT the same...
First and foremost an Independent Contractor is NOT an agent. I say again an Independent Contractor is NOT an agent. It is a contractual relationship defined by the terms of an agreement. (no agency relationship is created). There is a HUGE difference between what an AGENT and an INDEPENDENT CONTRACTOR is. Describing what an agent is will be in a separate blog, so... what is the definition of an independent contractor?
Independent Contractor means a real estate licensee who enters into a brokerage relationship that specifically states that the real estate licensee is acting as an independent contractor and not as an agent; has the obligations agreed to by the parties in the brokerage relationship; and MUST comply with the provisions of certain Virginia Codes...the real estate licensee knows them.
The independent contractor agreement is the brokerage relationship, and must clearly state the real estate licensee is:
- Acting solely as an independent contractor and NOT as an agent and
2. Only performing services as set forth in the agreement
In other words...If a real estate licensee is acting as an Independent Contract to assist an owner with a sale of real estate, the following shows the types of services (not all) that could be offered in the brokerage agreement:
1. List an owner’s property into the MLS,
2. Accept and discuss inquiries with real estate agents regarding a property listing, provide property information, and schedule showings,
3. Assist an owner with the use of the property disclosure form, lead-based paint disclosure, and property owner’s association/condo resale packets as applicable,
4. Review with an owner any offers or counteroffers of purchase contracts received by the owner, and to provide to the owner regarding the negotiation of any such offer/counteroffers and or
5. Prepare a comparable market analysis (CMA) of the owner’s property
In Virginia a real estate licensee in a brokerage relationship must be either a standard agent, a limited service agent, or an independent contractor.
I did the best I could to explain it here for you. Sometimes you just want a real estate licensee to perform certain services for you, so if any of those services you are looking for falls within what I wrote about you want an Independent Contractor not an agent.