A Buyer's Guide on How to Avoid Unregistered Real Estate Practitioners and the Jargon They Use

As a prospective buyer in the real estate market, it's crucial to be aware of the various players involved in the industry. While registered Real Estate Brokers and Real Estate Sales Person (refer as agent) are licensed professionals who operate within the bounds of the law, there is a darker side to the market – unregistered practitioners who may try to lure unsuspecting buyers into transactions that are not in their best interest.

Many of the unregistered brokers and agents fearlessly introduce themselves as real estate practitioners and openly seen on social media networks such as YouTube, Facebook and other digital platform. This is very disturbing because these people are not regulated by law and government. In our experience, these individuals do not have a licensed number to show that they are registered with the Philippine Regulation Commission (PRC) as duly registered real estate practitioners. They typically steer clear of deeper topics related to real estate, particularly legal issues.

Understanding the Jargon

In addition to questionable ploy, unregistered real estate practitioners may also use complex jargon to confuse buyers and strain them into making hasty decisions. Understanding some of the common terms used by these practitioners can help buyers navigate the market more effectively.

Diving into the Jargon

(Working) Under the license of a reputable real estate broker

Unregistered agents, operating outside the legal framework, often resort to deceptive tactics to gain the trust of unsuspecting potential buyers. They may falsely present themselves as working under the license of a reputable real estate broker, leveraging the credibility of the licensed professional to establish a veneer of legitimacy. By invoking the name of a licensed broker, these unscrupulous individuals aim to create a false sense of security, making buyers more inclined to engage their services. This ploy is particularly alarming as it exploits the trust that buyers place in licensed professionals, who are bound by ethical standards and legal obligations to act in the best interests of their clients. The presence of unregistered brokers who misrepresent their status as licensed poses a significant risk to consumers, as it undermines the integrity of the real estate industry and exposes buyers to potential financial and legal pitfalls.

Direct to Owner

The term 'direct to owner' is often employed by unregistered real estate brokers and agents as a deceptive tactic to gain access to property buyers and facilitate negotiations. By falsely presenting themselves as owner's assistant and possessing authority, these individuals attempt to circumvent the regulatory framework and avoid accountability for their actions. They exploit the trust and naivety of buyers, who may believe they are dealing directly with the property owner and thus entitled to more favorable terms or lower prices. This deceptive practice undermines the integrity of the real estate market and exposes buyers to potential risks. It is crucial for buyers to be vigilant and engage with licensed and reputable real estate professionals to safeguard their interests and ensure a transparent and ethical transaction process.

Direct to Seller

'Direct to seller' is a term that has been increasingly used in the real estate industry, particularly by unregistered real estate brokers and agents. This phrase is often used to confuse property buyers and enable unregistered brokers and agents to penetrate the real estate negotiation process. The implications of this practice can be far-reaching and potentially detrimental to both the buyer and the seller involved in a real estate transaction.

In a typical real estate transaction, a buyer or seller would usually work with a licensed and registered real estate agent or broker who represents their interests. These professionals are trained, knowledgeable, and experienced in the real estate market, and they have a fiduciary duty to act in the best interests of their clients. They are also required to adhere to a strict code of ethics and are subject to regulatory oversight.

However, unregistered brokers and agents who use the 'direct to seller' approach often operate outside of these regulatory frameworks. They may not have the necessary qualifications, experience, or knowledge to effectively represent a buyer's interests in a real estate transaction. This can lead to a number of potential issues, including:

1. Lack of transparency: Unregistered brokers and agents may not disclose their true intentions or motivations to the buyer, which can lead to a lack of trust and transparency in the negotiation process.

2. Inadequate representation: Without the proper training and experience, unregistered brokers and agents may not be able to effectively negotiate on behalf of the buyer, potentially resulting in a less favorable outcome for the buyer.

3. Legal risks: Engaging with an unregistered broker or agent can expose the buyer to potential legal risks, as these individuals may not be subject to the same regulatory oversight and protections as registered professionals.

4. Confusion and misinformation: The use of the 'direct to seller' approach can create confusion and misinformation among buyers, who may not fully understand the implications of working with an unregistered broker or agent.

While the 'direct to seller' approach may seem like a convenient and cost-effective option for some buyers, it is essential to recognize the potential risks and drawbacks associated with engaging with unregistered brokers and agents. To ensure a smooth and successful real estate transaction, it is always advisable to work with a licensed and registered real estate professional who has the necessary qualifications, experience, and knowledge to represent your interests effectively.

'Trustees'

Trustees, a term often associated with fiduciary roles in various contexts, is unfortunately also being used by unregistered real estate practitioners to confuse property buyers and penetrate the real estate negotiation process. This misuse of the term 'trustee' is a cause for concern in the real estate industry, as it can lead to potential fraud, misrepresentation, and financial losses for unsuspecting buyers.

However, unregistered real estate brokers and agents are exploiting the term 'trustee' to mislead property buyers and gain an unfair advantage in the negotiation process. By presenting themselves as trustees, these individuals can create an impression of authority, legitimacy, and trustworthiness, which can be particularly appealing to buyers who may not be familiar with the intricacies of the real estate industry.

This deceptive practice can have several negative consequences for property buyers. Firstly, it can lead to confusion and misunderstanding about the roles and responsibilities of the parties involved in the transaction. For example, a buyer may mistakenly believe that the 'trustee' has a legal obligation to act in their best interests, when in reality, the unregistered broker or agent is only looking out for their own interests.

Secondly, the misuse of the term 'trustee' can enable unregistered brokers and agents to engage in fraudulent or unethical behavior. For instance, they may misrepresent the condition of a property, inflate its value, or conceal important information about the property's history or legal status. This can result in buyers making decisions based on inaccurate or incomplete information, which can ultimately lead to financial losses and legal disputes.

The misuse of the term 'trustee' by unregistered real estate brokers and agents is a serious concern that can have significant negative consequences for property buyers. By understanding the true meaning and purpose of the term 'trustee' and being vigilant about the potential for deception and fraud in the real estate market, buyers can protect themselves and ensure that they make informed and responsible decisions when purchasing property.

In conclusion, unregistered real estate practitioners can pose a significant risk to buyers who are not informed or vigilant. By understanding the tactics and jargon used by these practitioners, buyers can make more informed decisions and protect themselves from potentially harmful transactions.

Remember, when it comes to real estate, it's always better to be safe.