When making a referral, realty agents should defer to clients' best interest

Question: As a real estate agent, I want to give buyers good advice but also limit my liability. Here are three schools of thought on how agents should handle home-inspector recommendations: Provide a list of available inspectors and advise buyers to choose whomever they want; recommend one inspector who regularly works for the real estate company, who belongs to a large network/franchise and who indemnifies the real estate agent and company; don't recommend anyone. Which of these options would you recommend?



Answer: If agent liability and client representation are primary considerations, there are problems with all three options.

The problem with providing a list of available inspectors and no guidance is that it would include the qualified, the unqualified and the mediocre.

What if your buyers choose one of the less qualified names on the list? In that case, disclosure of property defects would be incomplete, and you could be blamed for placing that inspector's name on the list.

The problem with always recommending a single inspector who indemnifies the agent and company is that the inspector is being chosen for reasons other than actual competence at finding defects. Such recommendations could result in undisclosed defects being discovered after the sale, and that spells liability.

Recommending no inspector and advising buyers to go shopping is problematic because most buyers have no idea how to choose a home inspector. If they pick someone who misses many defects, they can blame you for not providing direction for the hiring of local home inspectors.

The best way to serve clients and minimize your liability is to recommend the home inspector whom you have come to recognize as significantly more thorough than the competition. If two or more inspectors meet this standard, that's even better.

Real Estate Designers offers totally innovative solutions for your software development, Internet programming, real estate web design and hosting needs. Our service includes domain name registration and real estate web design. Real Estate Designers provides the complete solution including design, application development and marketing.

source: latimes.com