3 acts that lead to ethics complaints for real estate agents

People buying or selling real estate depend on licensed real estate agents to provide them with guidance through the complex process of listing a property, drafting an offer or going through a closing. As a real estate agent, you may help buyers, sellers or both navigate real estate transactions.

Often, your primary goal is to get from listing to closing as fast as possible when you represent a seller or to find the right property for a buyer. Some of the things that you do on your way to closing could put you at risk of facing a professional ethics complaint that could cost you your license.

What kind of behaviors might put your license at risk?

Not disclosing defects

Pennsylvania state law requires that those selling real estate provide thorough and accurate information to prospective buyers. You have to provide information on a disclosure form about each of the major systems in the house and any other known defects.

If a seller tells you about the issue or acknowledges that they know about it, you have a legal and ethical obligation to notify any prospective buyers and their agents. Failing to do so could lead to complaints or even a lawsuit.

Intentionally misrepresenting a property

Lying is often an ethical gray area for those who work in sales-adjacent careers. Real estate agents aren’t really salespeople, but they often take a sales-like approach to their jobs. Making inaccurate statements about a property to buyers whether you represent them or the seller could put someone into a transaction that they otherwise would not consider.

Currently, however, it is much more common for buyers to struggle to get a seller to take notice of their offer than to worry about misrepresentation of a property. If you get your buyers to write a compelling letter to the seller with their offer but it is full of lies, you might be partially responsible if the seller gets upset.

Having financial arrangements with other professionals

Do you always recommend the same company to buyers who need siding and windows because they give you a discount when you rework properties that you buy to flip? Do what you pay for golf and dinners for a local appraiser because they help you make sure that the properties your buyers make offers on appraise for an amount that the mortgage lender approves?

Having a kickback arrangement or similar scenario with other real estate professionals is a breach of the duty that you owe to your clients and customers and could result in complaints that cost you your license.

Understanding what practices are dangerous and also your right to defend yourself can help you maintain your professional license as a real estate agent in Pennsylvania.