What document outlines the terms of the broker-client relationship?

The document that outlines the terms of the broker-client relationship is the agency agreement. This agreement establishes the legal relationship between the broker and the client, detailing the rights, responsibilities, and obligations of both parties within the context of real estate transactions. It serves to clarify the duties of the broker, which may include fiduciary responsibilities such as loyalty, confidentiality, and full disclosure to the client.

While the listing agreement is used specifically for marketing a property and entering it into the real estate market, it is a subset of the broader agency relationship. The purchase agreement, on the other hand, pertains to the sale of the property itself, detailing the terms and conditions under which the property is sold, including price, contingencies, and closing procedures. The closing statement is a document provided at the completion of a real estate transaction summarizing fees and payments, but it does not define the broker-client relationship.

Recognizing the importance of the agency agreement is vital as it lays the foundation for trust and professionalism in real estate dealings. Understanding this agreement helps clients know the level of representation they will receive, which is crucial for successful real estate transactions.