According to wikipedia, Fiduciary duty is a legal or ethical relationship of confidence or trust between two or more parties. A fiduciary duty is the highest standard of care at either equity or law. A fiduciary is expected to be extremely loyal to the person to whom he owes the duty (the "principal"): he must not put his personal interests before the duty, and must not profit from his position as a fiduciary, unless the principal consents.
In a fiduciary relationship, one person, in a position of vulnerability, justifiably vests confidence, good faith, reliance and trust in another whose aid, advice or protection is sought in some matter. In such a relation good conscience requires the fiduciary to act at all times for the sole benefit and interest of the one who trusts.
As a Realtor, we have Fiduciary Responsibility to our client. The client is the home buyer or home seller that has contracted with the Realtor to represent them (signed Buyer Broker Agreement).
If you are not that Realtor's client, you are his customer. Realtor's owe a fiduciary duty to their clients, not their customers.
Example of client and customer:
Sales person at a new home development. While it may seem like they are representing you to buy the home from the builder, that is not the case at all. They are representing the builder. That sales person does not has fiduciary responsibility to you, that's why You Should Never Browse Model Homes Without a Realtor.
A Realtor Fiduciary Responsibility Spelled Out:
- Care: Realtor is expected to be knowledgeable to represent the seller or buyer in matters related to the real estate transaction.
- Obedience: Realtor must obey the instructions of the principal.
- Accountability: Realtor must safeguard any money and documents that are entrusted in our possession during the transaction.
- Loyalty: This means at all times the client's best interest must be first and foremost. The client's interests are ahead of the Realtor, and their broker's interests.
- Disclosure: Realtor must disclose all materials facts and defects in any property that is being sold
