Campbell & Associates Law Firm PC.

Top 3 Reasons Real Estate Agents Get Sued in Texas

Considering the details of contracts, juggling multiple clients, and handling high value properties, it is easy to see why real estate agents are vulnerable to lawsuits. Slight mistakes or compliance issues not only cost you money, time, and stress, but they can also impact your reputation. You should always discuss potential risks or questions with an experienced real estate agent liability attorney in Texas, but understanding the top three reasons you may face a lawsuit goes a long way to protecting yourself.

1. Unauthorized Practice of Law

It probably comes as no surprise that unauthorized practice of law makes the list, as many of your daily tasks as a real estate agent have legal implications. Still, even answering a quick question asked by a seller or prospective buyer can get you into trouble with the Texas Unauthorized Practice of Law Committee. Err on the side of caution when discussing tax matters, contractual provisions, or issues that border on legal advice.

2. Failure to Disclose Defects

A buyer’s joy when purchasing a new home can quickly turn to disappointment upon discovery of defects – and the real estate agent that handled the transaction is the first person he or she will blame. In addition to an official inspection, do your own walk through and document every defect or bit of damage you find related to the property’s four primary systems: the HVAC, roof, plumbing, and electrical. Also, note any:

  • Foundation cracks;
  • Creaks or slopes in the floors;
  • Noises;
  • Construction issues;
  • Obvious improvements to ensure proper building permits; and,
  • Any other issues.

Prepare a disclosure document related to what you discover and have the buyer sign an acknowledgement of the defects.

3. Breach of Duty

Always remember that you represent one party to a real estate transaction; for most real estate agents, this is likely to be the seller. It is easy for the lines to get blurred in a real estate transaction, but avoid any conversations or acts that amount to breach of the duties you owe your own client.

Discuss Your Situation with an Experienced Real Estate Agent Liability Lawyer

The job of a real estate agent in Texas is rewarding, but there are pitfalls that could lead to litigation if you do not take action to protect yourself. Knowing the top reasons people in your profession get sued is effective, but it does not replace the advice and counsel a knowledgeable attorney can provide. For more information on real estate agent liability or to schedule a consultation, please contact the Campbell & Associates Law Firm, P.C. in Dallas, TX.