Humber/Ontario Real Estate Course 4 Exam Practice

If buyers agree to customer service representation after appropriate disclosures and sign a buyer customer service agreement, how does this impact the brokerage’s duties?

1. The brokerage owes no responsibilities to them in negotiations.

2. Buyers might still owe the brokerage remuneration if the seller doesn't pay.

3. The brokerage must remain impartial to both seller and buyers.

4. The brokerage does not represent the buyers.

5. It means the brokerage has fiduciary duties to buyers.

6. Buyers automatically gain priority in offers.

The correct answer is: The brokerage does not represent the buyers.

When buyers agree to customer service representation and sign a buyer customer service agreement after receiving appropriate disclosures, it means that the brokerage does not represent the buyers in a fiduciary manner. Instead, the relationship established is that of a customer, where the brokerage provides services but is not obligated to act in the buyers' best interests as an agent would. In this context, the nature of the brokerage's duties shifts. Rather than having fiduciary responsibilities—such as loyalty, full disclosure, or the obligation to act in the best interests of the buyers—the brokerage's duty is limited to providing customer service and fulfilling the terms outlined in the agreement. This means that the brokerage must inform the buyers of relevant information and facilitate transactions, but does not have the same legal obligations to protect their interests in negotiations or offer advice. Understanding this distinction is crucial, as a customer service relationship lacks the comprehensive level of representation that a client-agent relationship would entail. Therefore, while buyers receive a basic level of service and information, they should be aware that the brokerage's duties are not those of a traditional representative.