Credit gives the word to pay either by repaying it or returning those resources later. In other words, this credit is the method of making the reciprocity formal, legally enforceable, and of course, extensible to a vast group of people who are not related.
However, the resources provided may be financial or have goods or services, like consumer credit. The credit covers any form of deferred payment. Credit generally gets extended by the creditor, the debtor or lender, and sometimes the borrower.
A legal relationship formed between two parties, based on confidentiality and keeping in mind the benefit of one is called ‘fiduciary.’ The party for whose benefit the relationship is formed is called the beneficiary and the other party is known as the fiduciary.
In terms of real estate, a buyer looking for a house or a seller listing their property on sale would be the beneficiary and the agent helping them would be the fiduciary. The relationship can be formed either intentionally with a written agreement signed by both the parties or unintentionally based on a code of conduct depending on the parties.
Here’s how a Fiduciary takes up their role:
For the buyers: Here, a fiduciary is responsible to help them explore the best suitable options based on their requirements and the budget.
For the seller: Here, a fiduciary brings suitable buyers whose requirements meet that of the seller’s property. A fiduciary also assists them through the entire legal proceedings and makes all the necessary settlements on their client’s behalf.
Following are some of the key duties of a fiduciary:
A real estate fiduciary must make sure to act in the best interest of their clients and avoid any conflict of interest. They should also safeguard the property, any money, deeds, documents or other information entrusted to them on their beneficiary’s behalf.
A fiduciary is responsible to keep all the information of their beneficiary confidential, which would bring down their negotiating powers. However, this does not apply to any material information about the seller’s property, that the buyer has the right to know.
A fiduciary must make sure to disclose to the beneficiary, all the necessary information about the relevant property or the buyer in his knowledge and any other information that would strengthen the beneficiary’s negotiating power against the third party.
A fiduciary must exercise reasonable care and diligence while serving their beneficiary. They must implement their skills and real estate proficiency to discover everything about the third party and the property to make a smooth transaction.
