What Does The Acronym OLDCAR Mean In Real Estate?
When it comes to your real estate exam, there are a number of acronyms that you need to be familiar with.
One of these is OLDCAR, which stands for Obedience, Loyalty, Disclosure, Confidentiality, Accountability, and Reasonable Care/Diligence. These are the standards that professionals in the industry are held to in order to protect their clients. This has to do with an agents fiduciary duties.
When a licensed real estate agent works with you on your house purchases or sales, an agency connection is formed. These six fiduciary obligations are owed to you as the client by virtue of this agency relationship.
This duty requires agents must be in full compliance with all applicable laws, including consumer protection and fair housing laws.
For example, if a client tells their agent to only show them properties that are within their budget, the agent must obey this instruction. Agents must be in full compliance with all applicable laws, including consumer protection and fair housing laws.
Agents must always act in their clients' best interests, even if it goes against their own interests.
For example, if an agent has a friend who is selling their home, the agent cannot pressure their client into buying it if it is not in their best interest.
Agents must disclose any material information that could affect their client's decision to buy or sell a property. For example, if there is a problem with the title of a property, the agent must disclose this to the client.
To be clear, this obligation does not apply to the seller's duty to disclose any known facts, conditions, or problems with the property being sold under the Disclosure Law.
Agents must keep their clients' confidential information, such as their financial situation, private. An agent's purpose is to keep a client's privileged information secret and anything else that could harm the client's bargaining position.
Confidential information not diminished is the seller's duty to inform about the property condition. An agent should never mislead prospective buyers about the property's condition.
Agents must be honest and transparent in all of their dealings with their clients. For example, they cannot hide the fact that they are receiving a commission from the sale of a property.
Agents must exercise reasonable care and diligence when representing their clients. For example, they should research properties before showing them to their clients.
An agent is to detect any potential warning signals, research and gather information, and if required, always seek, and refer clients to other expert professionals such as inspectors, architects, structural engineers, soils engineers, attorneys, accountants, electricians, and plumbers.
These are just a few examples of the OLDCAR acronym in action. As you can see, it is important to work with a real estate agent that you can trust to represent your best interests.
If you are thinking about buying or selling a property, be sure to find a real estate agent that you can trust to help you through the process.
Look for someone who is familiar with the OLDCAR acronym and its fiduciary duties. This will ensure that you are working with an agent who has your best interests at heart.
If you want to see some examples of questions that will be on the actual real estate exam, check out our free real estate practice exam. We have been named as the best real estate exam practice for 7 years in a row!
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