What it Means to be a Fiduciary in a New York Matrimonial Sale

Since most real estate agents are viewed more as salespeople than advocates in typical transactions, people often forget that, like lawyers, accountants and physicians, we are fiduciaries for the client.

In simple terms, being a fiduciary is a far higher level of service than most roles professionals play. Our duties to the client include care, confidentiality, loyalty, obedience to all lawful instructions, accounting, and disclosure. This goes beyond mere customer service or professional comportment. We are advocates for the client, even if it goes contrary to our own personal interests, we take that role extremely seriously.

The wrinkle in a matrimonial sale of real estate is that the divorcing parties don’t always have the exact same interests. They may not be on speaking terms. There may be information that one does not wish shared with the other party. And then you have the concern about how to balance this dynamic with the buyer of the home, who in many cases does not even know why they are selling the house. Since many buyers will view divorce as a bargaining chip that gives them leverage in a negotiation, we advise sellers in most cases to not disclose that the reason for the sale is the dissolution of their union. Confidentiality is important to protect the interests of the seller client.

But confidentiality isn’t enough then the clients themselves have competing interests or at odds in other matters related to the divorce. The job of the agent is the sell the home with the best terms possible for the clients, but also to not contribute to any disharmony or conflict with the divorcing seller clients. Our typical solution has been to designate a separate agent for each principal. In a typical sale of this type, one agent on the team deals with one spouse, and another agent on the teams deals with the other. This way, even an inadvertent remark cannot come back and further complicate matters.

Having two agents in these roles does not make the agents adversarial; moreover, the arrangement is to avoid disharmony or conflict rather than contribute to it. Not all sales are like this, but when the divorcing parties are not on the same page in matters unrelated to the transaction, this minimizes the risk of further difficulty and promotes the smooth progression of the transaction. This is especially do in a transaction where the parties are litigating, and in New York, especially Westchester and the surrounding counties, that can be expensive.

Designated agency on the other hand, with one Realtor for each party, does not cost the sellers anything extra, and ensures the transaction is not harmed by other factors related to the divorce.

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