The terms customer and client may sound the same, but in the real estate world, they have very different meanings. Knowing the difference as a buyer or seller is crucial and can impact your real estate experience. This is what you need to know:

Client Vs. Customer
A client is the party who hires an agent to represent the client’s best interests. Typically, this is done by signing a listing agreement or signing a buyer agency agreement.  The firm and agent which you hire will work to the best of their ability to represent you and your best interests. As a customer, you do not enter into an agency agreement. A firm will provide you with brokerage services and necessary information as a customer but does so on behalf of the seller.

For example, The Johnson family (seller) hires Firm ABC to list their home. In this case, the Johnson family is considered a client since they signed an agreement with Firm ABC. The Smith family (buyer) asks Firm XYZ to write an offer on the Johnson’s family home but does not sign a buyer agency agreement with Firm XYZ. Since the Smith’s decided to not sign an agreement with Firm XYZ, they are considered a customer. Firm XYZ may still provide brokerage services, such as writing offers for the Smith’s, but the Smith’s will need to sign a Disclosure to Customers form to acknowledge the duties owed throughout the transaction which is not the same duties served to a client.

Agent Responsibilities:
As a client you enter into an agreement which requires an agent and firm to act in your best interest, offering advice and guidance throughout the transaction. Agents must also put your best interests above their own. When you are a customer, there is no formal agency agreement, and an agent is not obligated to represent your specific interests. Note that agents are still expected to perform their duties fairly and honestly to all parties. While agents may not provide in-depth advice to a customer as they would a client, agents still must inform customers of any material facts that could affect their decision when purchasing a home.

An example would be if the Smith family is looking for a five-bedroom waterfront property, with 500ft of frontage for less than $170,000 in 5-star condition. The agent who is working with the Smith family knows that a property like this would be impossible in the area they are looking in and would likely want to buy for their best interest. However, if the Smith family signed a buyer agency agreement, the agent would be contractually obligated to tell them about the property. The agent would have to put the Smith’s family’s best interests above their own.

Understanding Your Choices
Knowing the difference between being a client and a customer can have a big impact on your real estate journey. Regardless of which option you decide on (client or customer), agents have specific responsibilities they must uphold for everyone involved in a transaction, whether that person is a client, customer, or even a third party. At Emmer Real Estate, we are here to ensure you’re fully informed of your options and feel confident with the decisions you make.

Give us a call today to discuss more: West Bend Office: 262-639-4747 | Green Lake Office: 920-294-4747