George J. Gaspar is an Active Arizona Real Estate Licensee





By George J. Gaspar, Realtor, ABR, e-PRO, CNE, SFR (Ver 1.11)

 Test your knowledge of Real Estate and Buyer/Seller agency or representation.

     1) If I want to buy a home, the best way to start looking is to surf the Internet (Net)? 

      True or False?

 Ans: False

While The Internet is a great resource for information, did you know that many listings advertised on The Internet are obsolete, outdated or not truly in Active status?  

Many local Multiple Listing Service (MLS) systems contain variations of Active (no accepted contract) status, including Active With Contingency (AWC) or Under Contract Backups (UCB).  Any home listed as AWC or UCB is not truly Active (There is someone ahead of you!).  Many Short Sales (SS) listings are AWC or UCB status, which means a purchase offer has been accepted by the Seller, but they are likely still waiting on lender approval. 

Beware! home listings at,, and other non-local MLS web sites do not distinguish between Active, AWC or UCB and typically do not indicate Special Listing Conditions, such as: Short Sale (Lender Approval Required), Lender Approved Short Sale (LASS), Previously Approved Short Sale (PASS), Owner/Agent, Lender-Owned, Age-Restricted etc., unless they are voluntarily (optionally) indicated in the Public Remarks section. 

The Arizona Regional Multiple Listing Service (ARMLS) also has a special Status Update field, which allows listing agents to indicate if Multiple Offers have been received.  A local agent/Realtor with ARMLS subscription/access can exclude these types of properties from your search, but public Internet sites do not typically have this capability.  Furthermore unlike ARMLS, many public web sites are not supervised, do not have a data integrity department and do not have a mechanism for reporting errors.  Furthermore unlike ARMLS, many public web sites are not supervised, do not have a data integrity department and do not have a user or subscriber mechanism for reporting errors. 

For example, I recently had a client who asked me about a home at  He did not quite have the complete address and the partial address that he gave me was actually wrong.  After some research, and wasted time, I discovered that the property of interest had sold about 2 ½ months ago and should have been removed from this web site.  In fact this web site imposes a membership fee or order to obtain the full address of the property!  Why, for obsolete data?

Therefore, one may waste much time looking at home listings on the Net, which are undesirable or not actually available.  Also many search engines at non-MLS web sites do allow you to specify or distinguish between classes of listings, such as conventional, pre-foreclosure, short sales and REOs and further do not have sufficiently detailed searchable fields (for example play pool versus diving pool or separate MBR exit) when you need them.

A better way to start your home buying endeavor is to establish a relationship with an exceptional Realtor who has advanced training and is dedicated to delivering outstanding consultation and custom service.  Arrange to have a 30 to 40 minute counseling session with that Realtor at their office.  During this session, the Realtor can discuss your real estate goals/objectives, outline a home purchase plan and guide you from the onset before you make critical mistakes or waste time working in an inefficient manner. 

Often the Realtor may provide a referral to a reputable lender, who can provide a pre-qualification assessment for the buyer, advise them of the best loan program for their intended purchase and arrive at a realistic purchase price maximum consistent with loan program guidelines and the Buyer’s comfort level.  The lender can also provide the Buyer a Good Faith Estimate (GFE) of projected loan and closing costs.  Then the Realtor, who through their paid subscription to a local MLS system and advanced MLS software, can create a custom search for the Buyer with more detailed precision than Internet web sites for homes within the price range they have been pre-qualified. 

Furthermore, since the data and photos in most listings on the Net originate from a local MLS source, it takes some time for listings at these other web sites to be updated from the local MLS.  Local MLS software, such as Flexmls utilized by the ARMLS, contains superior mapping, viewing, sorting, information and statistical capabilities than other general-purpose listing web sites.  When the perfect home appears on the market, a Buyer will have the advantage of quick updates from the agent or via Flexmls auto-email notification, giving them a strategic edge over the competition.  The Realtor can also create multiple different simultaneous searches for a client, and also configure a personal Client Portal (personal listing web site) to allow the Buyer to view and categorize the prospective listings for all the client’s various custom searches.

If you want to search and save searches on your own, connect with an agent who offers an IDX (Internet Data Exchange) program or ListingBook, because these type of search engines are more up-to-date, can distinguish between Active and AWC and are closely linked to a local MLS system, sponsored by a local agent's subscription to that local MLS. 

2)     Going to open houses is a good way to find the home I may want to buy.      True or False?

Ans: False

Homes that hold Open houses (OHs) are only a very small percentage of the total number of homes on the market and many listed homes hold few or no OHs.  Furthermore, one generally has limited advance information about the home before seeing it, such and number of bedrooms, bathrooms, Square Footage (SF), private pool etc.   While an open house may be a good opportunity to meet a professional realtor to help represent you as a Buyer’s or Seller’s Agent, this process is non-focused, relatively inefficient and often results in the prospective buyer often finding that the OH home was lacking some or many of the features they desired.  Also visiting an OH without the agent/Realtor that you wish to represent you may jeopardize that agent's ability to be compensated through the normal means, if you desire to purchase the OH home.

3)     If I see or drive by a home I like, the best way to find out more information is to call the listing agent for a showing.  Then if I like it, have the listing agent prepare/write a purchase contract for me.   True or False?

Ans: False

If you ask the listing agent to represent you and prepare/write a purchase contract, you have immediately entered into a limited (compromised) dual-representation situation.  When one agent represents both Buyer and Seller, the fiduciary duties that the agent owes to each client are inherently compromised and limited.  Furthermore, both Buyer & Seller must mutually agree in writing to allow this form of limited representation.  In this situation the agent must be neutral, unbiased and cannot show favoritism to either party.  Therefore the agent will not be ethically allowed to negotiate a stronger position for one party versus another.  To make an analogy, imagine one attorney representing both parties in a lawsuit!  A better way is to develop a relationship with an exceptional Realtor who provides representation to you as an independent Buyer’s Broker/Agent and preferably one who holds an Accredited Buyer’s Representative (ABR) designation, demonstrating specific experience, training and expertise representing Buyers.  This form of agency has no compromises in fiduciary duties.  The Buyer benefit is that the Realtor can be a more effective negotiator and be an advocate for your position as a Buyer.

 4)     Able (buyer) has been working with a Realtor (Baker) for over 6 months, who has shown Able numerous homes.  Due to the work and longevity working with Baker, Able would like to have Baker represent him, if and when, he purchases a home.  Next Sunday Able attends an open house held by Realtor Charlie and Able subsequently has Baker write a purchase contract for the open house property.  This property later successfully closes escrow with Baker and his affiliated broker receiving compensation as the Buyer’s or cooperating Broker.  Many months after the close of escrow, Baker and his affiliated broker could lose their entire compensation for representing Able in the transaction.  True or False?

Ans: True

Realtors are bound to comply with the National Association of Realtors (NAR) Code of Ethics (C of E).  According to the NAR C of E, the broker/agent who is entitled to compensation is one who demonstrates by a series of interrupted events that they procured the buyer in a successful sale and close of escrow.  Procuring cause is property specific and has nothing to do with longevity of service, who writes the contract, the amount of work performed or how many previous homes an agent may have shown to a Buyer.  

Although introducing or providing initial access to a particular property ultimately purchased by the Buyer may not be sufficient in itself, in the context of procuring cause and compensation complaints, it is often given the most significant weight to the party that does so.  Although a Buyer can choose with whom they work and who represents them in a transaction, the Buyer cannot choose which agent or broker is compensated, except sometimes indirectly or inadvertently through their actions or misactions. 

If Charlie claims he was the procuring cause of Able purchasing the home, subsequently files a commission dispute complaint with his local real estate board and successfully convinces the arbitration hearing panel that he was instrumental in procuring Able, Charlie will likely be awarded the entire commission previously collected by Baker and his broker.  In this case Baker will forfeit his entire commission to Charlie and his affiliated broker.  Decisions by arbitration hearing panels are based on the preponderance of evidence and the awards are usually all or nothing – one party wins and is awarded the commission and the other party loses.  In this case, Baker and his broker lose their entire commission due to the actions of the buyer Able.   

We frequently see buyers attending open houses without the Realtor they claim to be working with, so Buyers are either consciously breaching the loyalty commitment to their Realtor or they have not been educated by the same.  If Baker had initially counseled and informed Able about the consequences of attending open houses without his presence, the above undesirable result may have been avoided.  Furthermore, if Baker had a signed Buyer-Broker Exclusive Employment Agreement (BBEEA) with Able, the BBEEA would have clearly indicated Able’s responsibility to Baker and the possible risks in breaching those.  Since Baker was not the procuring cause and lost his cooperating compensation via the normal means (from the listing broker) due to the actions of Able, Able may be ethically or financially liable to Baker for the resulting loss.

5)     If I decide to go to the sales office of a new home developer/builder and purchase a new home, I don’t need to have Buyer/Broker (independent) representation, because the sales associate is a licensed Realtor.   True or False?

Ans: False

When a Buyer visits the builder’s sales office, the on-site sales representative or agent there is employed by and compensated by the builder to help sell their homes.  When you are represented by an independent Buyer’s Broker/Agent (BB/A), even though they may be receiving compensation in whole or part from the listing broker or builder, the BB/A has no incentive to sell you a particular home, but only the home (new or resale) that the Buyer feels is the best for their needs and budget. 

In most all cases, a builder/developer is willing to compensate an independent BB/A for a successful Buyer purchase, but they will not do this unless both Buyer and Agent are registered upon the first visit.  Buyer’s who initially arrive at the sales office without an agent will lose their ability to have this independent representation, which is usually at no cost to the Buyer.  In the latter case (no Buyer’s agent), the builder will generally not refund to the Buyer the amount they would have compensated the BB/A, but will simply take this as more profit for themselves.  This results in a Win for the developer/builder and a Lose for the Buyer, where it could have been a Win-Win outcome.

    6)     If I purchase a new home from a developer/builder, I don’t need to have an independent professional home inspection, because the builder provides a 10-year warranty.  True or False?

Ans: False

Imagine your frustration when you discover that the builder forgot to install insulation in the attic or they forgot to connect the PVC pipe to the backup condensate drain pan on the HVAC evaporator in the attic?   These are real case-history situations, which could have been discovered by an adept licensed professional inspector.  Don’t be pacified by the builder/developer performing your home inspection by their own rubber-stamping people.  Utilize the services of a professional, licensed independent home inspector who works for you.  Regardless of the builder’s warranty you should have an independent home inspection performed at least at the pre-drywall stage and final walk-through stage.

7)     In order to get a good assessment of the market value of my home, the most efficient and accurate way is to use or  True or False?

Ans: False

While may provide a quick and rough map-based indication of market value, as a Realtor with access to recent sales and analysis tools, I have found significant discrepancies in the accuracy of the home data and the “Zestimate” they indicate, such as a $60,000 difference in a just-sold property.  Similarly when I entered a property address at, I discovered that the most recently indicated sale, was not really a sale at all, but just a change in the ownership of the property, such as from a person to a trust.  Apparently their automated computation system cannot distinguish the difference.  A better and more accurate way of determining market value would be to employ the expertise of an excellent Realtor with access to a local MLS system, who can provide a comprehensive, adjustment-based Comparative Market Analysis (CMA) of your home’s current market value.    

8)     I have known Bonnie and her family for 10 years.  Bonnie just got her real estate license and offered me a discount for listing my home.  Since I trust Bonnie, it is prudent to have her represent me as a listing agent.    True or False?

Ans: False

While Bonnie may be as honest as the day is long and trust is important, experience and savvy are essential when you consider your most valuable and treasured investment, your home.  Often real estate agents that immediately offer “discounts” will compromise the services that they will provide and the client will ultimately pay the consequences of reduced or inferior services.  If Bonnie doesn’t provide the highest level of real estate acumen, marketing expertise and negotiation skills, due to her lack of experience in a competitive marketplace, the discount will be useless if the home does not sell and you have not accomplished your objective.  Furthermore, if you are disappointed with Bonnie’s services, it may be more difficult for you to “fire” Bonnie because of the social relationship that you have with her and her family. 

9)     I am a Buyer seeking good deals on prospective properties; therefore, I want to focus exclusively on REOs or lender-owned properties, because these are a better value than conventional sales.  Other than some possible repairs that may be required, there are no disadvantages of REOs compared to conventional sales.    True or False?

Ans: False

While REOs may be listed at a low price and may be a good apparent value, nearly all REO properties are sold “AS-IS” and the lender will usually not accommodate repair requests.  Furthermore, the Seller (lender) will not provide 2 important disclosures (Required per the Arizona Association of Realtors (AAR) Residential Resale Real Estate Purchase Contract), the Sellers Property Disclosure Statement (SPDS) and Comprehensive Underwriting Loss Exchange (CLUE) (5 year insurance claims) report.  Additionally the Seller (lender) usually stipulates the title company and/or closing agent; whereas this is normally the Buyer’s choice.  Sometimes REO properties have missing or vandalized equipment or may have latent defects, which may not be obvious to the Buyer unless thoroughly investigated and tested.  If 2 similar properties (REO and conventional) are competitively priced, the conventional sale may be a lower risk property and ultimately a better value.

10)  A Buyer-Broker/Agent (an agent that works with Buyers) is a sub-agent of and essentially works for the Seller, because they receive compensation (a commission) from the Seller.           True or False?

Ans: False

If a Buyer-Broker/Agent procures the Buyer and this leads to a successful sale (close of escrow), as part of the MLS unilateral offer of compensation to a cooperating Broker/Agent, a Listing Broker offers cooperating compensation (commission) to a Buyer-Broker/Agent (cooperating Broker/Agent) for assisting the Buyer in the transaction. 

While a Buyer-Broker/Agent (B-B/A) may receive compensation in whole or in part from the Listing Broker, who in turn receives their compensation from the Seller, a Buyer-Broker/Agent is rarely a sub-agent of the Seller.  A subagent is an agent who works with Buyers and shows them properties, but who owes his or her fiduciary duty to the Seller.  This form of agency has been obsolete for 15 to 20 years and is generally banned in most, if not all, states due to the disadvantages it posed to Buyers.

Even though a B-B/A may receive compensation in whole or part from the Listing Broker, the B-B/A has absolutely no fiduciary duties to the Seller or the Listing Broker/Agent, but has fiduciary duties exclusively to the Buyer.  One exception is when the B-B/A is also the Listing Agent.  In this case both Buyer and Seller must further agree that one Agent will represent them and accept the inherent compromised or limited fiduciary duties that result in this situation.  In this case the single agent must be neutral and unbiased with respect to the Buyer and the Seller and cannot be an advocate for either side. 

A Buyer-Broker Exclusive Employment Agreement (Buyer Representation Agreement) as it applies to the Buyer is similar to a Listing Agreement as it applies to the Seller.

George J. Gaspar is an actively licensed full-time Realtor affiliated with US Preferred Realty, Inc. holding Accredited Buyer Representative (ABR), e-PRO and Certified Negotiation Expert (CNE) designations and Short Sale Foreclosure Resource (SFR) certification.

Buying Services for Home Buyers

Congratulations!  You have decided to purchase a home, or are thinking about buying one.  You'll be joining the ranks of hundreds of families who realize that home ownership offers a number of benefits including building equity, saving for the future, and creating an environment for your family.  When you own your own home, your hard-earned dollars contribute to your mortgage. The equity you earn is yours.  Over time, your home will increase in value.

In the following reports, you'll find the information you need to make a wise buying decision.  We'll take you through the planning process step-by-step , to help you determine which home is right for you.  You'll find a host of informative articles on mortgages, viewing homes, the offer, closing details and moving.

Please contact me if you have any questions about buying a home in Mesa or elsewhere in Arizona.

Below, select desired reports and complete the form provided.

Avoid The Most Common Buyer Errors
Some buyers, however, caught up in the excitement of buying a new home tend to overlook some items. When you have a systematic plan before you shop, you’ll be sure to avoid these costly errors. Here are some tips on making the most of your home purchase.
Buying Your First Home?
Many renters are starting to think about purchasing a home of their own. This article highlights several factors that should be considered when purchasing a home.
How Not To Pay Too Much For Your Home
This article helps you become a savvy buyer, by pointing out some of the pitfalls inherent in the home-buying process.
A Smooth Home Purchase in Six Steps
Buying a home can be an emotional, time-consuming, and complex process. There are a few things that you can do to help make the process go as smooth as possible
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