"Ethics" . . . a term we have heard all our lives. Looking up the definition of the word "ethics," we see it defined as "principles of right conduct." I think all of us would want to be considered ethical individuals. It is particularly important to be ethical when we are dealing with people or have a fiduciary responsibility or duty toward others. No matter what our business may be, to be known as an "unethical person" will put one in jeopardy as to one's job, and also subject that individual to civil or even criminal prosecution.
Every four years, real estate brokers and salespeople must complete continuing education courses prescribed by the California Department of Real Estate. One of the mandatory courses is "Ethics." This course reviews the obligation we have as brokers and salespeople toward our clients. It reenforces the Department's Business and Professions Code which states that we are to give a high level of competent, ethical, and quality service to buyers and sellers in real estate transactions.
The Business and Professions Code also covers mortgage brokers licensed by the Department of Real Estate. The same high quality of service should be exercised by mortgage brokers toward borrowers.
How does one find an ethical person with whom to transact business? Do you look up a name in the Yellow Pages under "Ethical" lender or real estate salesperson? Do you ask the question up front during the interview process? Do you quiz a relative or friend as to his/her past dealings with a real estate agent or loan agent? Are your relative's or friend's standards the same as yours? Is there a fool proof way to find that "ethical person" with whom you would want to do business? The answer to the above questions is, "I don't know!"
We are all bound to be ethical and keep the interest of seller, buyer and borrower foremost in our dealings. We are bound to represent each party to the best of our ability and understand this obligation when we undertake such representation. However, as a seller, buyer and/or borrower you have an obligation yourself. As ethical as a person may be, you have the ultimate responsibility to protect your interests and your assets. You must determine that the person with whom you are dealing is competent. As principled as the individual may be, if he/she is not competent that person is not being ethical in representing your best interests.
As to the purchase of real estate you have heard the mantra: "location, location, location." If you are to protect yourself when it comes to one of the most critical decisions of your life, be you a first time home buyer or a buyer with two, three or more home purchases behind you, you must "read the contract, read the disclosures, read the addenda." If you are planning to obtain a real estate loan you should read every piece of paper you receive. Know what you are signing.
It is easier to avoid a problem in the beginning of the purchase or refinance transaction then it would be to look for a solution after the close of escrow. So, as a borrower, buyer or seller, you should have as your mantra, "Read, Read, Read . . . Understand, Understand, Understand . . . Ask questions, Ask questions, Ask questions."
Look for competency on the part of your real estate agent or loan officer. Remember, a person may be an ethical individual; however, your goal is to have your representative be both ethical and competent. Read; ask questions; and understand the answers to those questions.
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