Realtors – Are Your WORDS Violating Your Fiduciary Responsibilities?

Are Your Words Violating Your Fiduciary Responsibilities in Real Estate?

In the fast-paced world of real estate, the words you say or write can make or break a deal. But more importantly, what you say can have legal implications, especially if you violate your fiduciary responsibility to your clients. In this blog, Mike Ferrante, Team Leader of the 21 Mike Team at Century 21 HomeStar, and Tony Geraci, Broker/Owner of Century 21 HomeStar, dive into the importance of being careful with your language as a real estate professional.

Why Words Matter in Real Estate Transactions

Whether you’re a buyer’s agent or a listing agent, your fiduciary duty means you must always act in your client’s best interest. However, what you say to the other party, how you give feedback, or what you communicate in writing could unintentionally work against your clients. A recent incident serves as a perfect example. An agent who provided negative feedback on a property unknowingly harmed their buyer’s chances. The seller took the feedback to mean that the buyers would be difficult to work with, which led to the deal falling apart. Even though the agent may have been trying to help, their words ultimately violated their duty to their client.

Tony Geraci adds, “I always tell agents, imagine everything you say or write is being recorded and shared publicly. If you’re okay with that, then go ahead. But if not, rethink your approach.”

The Fine Line of Feedback: What Should You Say?

Many agents wonder whether they should even provide feedback on showings. After all, if what you say can be used against you, why risk it? Mike offers some advice: “If your clients are interested, it’s important to communicate that, but be careful about oversharing. Keep feedback generic and avoid giving away too much information.”

Tony agrees and suggests, “Always reflect your client’s thoughts rather than your own opinions. For example, instead of saying, ‘I think the property is overpriced,’ say something like, ‘My clients are considering their options based on comparable properties.’ This way, you’re protecting yourself and your clients from unintended consequences.”

In fact, Tony warns that providing too much opinion-based feedback can also harm your reputation in the community. He recalls an instance where an agent consistently left negative feedback and, as a result, developed a bad reputation among sellers and their agents. “You don’t want to be the agent that other people remember for negative comments,” Tony advises.

What Should Listing Agents Avoid Saying?

It’s not just buyer’s agents who need to be cautious. Listing agents can also give away too much information that could harm their clients. A classic example is when a buyer’s agent asks, “Why are they selling?” While this may seem like an innocent question, revealing too much—such as a job transfer, divorce, or financial hardship—can give buyers leverage in negotiations.

Tony notes, “As a listing agent, your job is to protect your client’s information. Answering that question with something like, ‘They’re just looking to make a move,’ is a safe way to handle it. There’s no need to give away details that could potentially harm your seller’s negotiating position.”

Disclosing too much can be a slippery slope, especially in a competitive market like Cleveland. Even if you think you’re helping by giving a reason for the sale, it could lead to assumptions about your seller’s willingness to negotiate or their financial situation.

Written Words Live Forever—So Be Careful

Mike and Tony also stress the importance of being cautious about what you write. Whether it’s in emails, texts, or feedback forms, written words are permanent. Mike adds, “Once something is written down, it can be used in court or become part of a dispute.”

For listing agents, this means being careful about how you respond to offers, counteroffers, or even how you communicate with buyer agents. In an era where emails and texts are often the preferred communication methods, taking an extra moment to think before sending a message can save you from potential legal issues.

Avoid Practicing Law Without a License

Another common mistake agents make is interpreting legal terms in contracts. Tony warns, “Agents sometimes try to explain contract language or tell their clients what the contract means. That’s practicing law without a license, and it can get you in trouble.”

Instead, Tony recommends that agents always consult with their broker or manager before giving legal advice. “If you’re unsure, it’s better to pick up the phone and call your broker rather than putting something in writing that could be misconstrued,” Tony says. This protects both the agent and the client from potential legal disputes.

Final Thoughts: Protect Yourself and Your Clients

In the Cleveland real estate market and beyond, your words—whether spoken or written—have power. By being mindful of what you say and how you say it, you can protect yourself from legal issues and ensure that you’re always acting in your client’s best interests. Tony Geraci and Mike Ferrante’s advice boils down to this: Speak carefully, write wisely, and always think before you hit send.

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