Selling Your Home? Here’s 5 Questions Your Real Estate Agent Can’t Answer

Throughout your home sale, your real estate agent wears many hats: salesperson, stager, marketer, negotiator, and all-around industry expert. They’re a wealth of information, ready to answer your many questions about the selling process. Still, there are some questions real estate agents can’t answer.

For instance, while real estate agents are experts on local housing markets, they do not have a license to answer questions about legal and financial issues that affect sellers. We consulted an expert attorney and top real estate agent and put together a list of important questions that are better to ask other industry professionals. Here are five types of questions real estate agents can’t answer:

1. Questions that breach real estate associations’ codes of ethics

Nearly three-quarters of licensed real estate agents in the U.S. are members of the National Association of Realtors (NAR) either directly or through their local chapter. These real estate associations require their members to abide by a code of ethics that promotes honesty and excellent client service.

For instance, NAR’s Code of Ethics and Standards of Practice stipulates that agents must be “honest and truthful in their real estate communications” and never conceal the fact that they are real estate professionals.

While these rules are in place for the benefit of both sellers and buyers, some of them explicitly limit your agent’s capacities. The document states that “Realtors® shall not undertake to provide specialized professional services concerning a type of property or service that is outside their field of competence unless they engage the assistance of one who is competent on such types of property or service, or unless the facts are fully disclosed to the client.”

Here are a few of the things that NAR prevents their member agents from doing:

• Representing both seller and buyer without informed consent from both parties
• Delaying the submission of a counteroffer
• Exaggerating, misrepresenting, or concealing pertinent information about the property to buyers
• Misrepresenting their availability to show or inspect a listed property
• Acquiring an interest in buying or presenting offers from themselves or their family members without revealing their status as a Realtor to all involved parties (in essence, if the Realtor® has a financial interest in the property, it’s considered a conflict of interest)

“There’s certain things that I don’t know or can’t say too much about because they are a conflict of interest,” shares Ruth Wordelman, a top Colorado real estate agent and licensed attorney under the Colorado Bar Association.

2. Questions asking for legal advice or practice

While your real estate probably knows a fair amount about the legal aspects of selling a home, they cannot provide you with legal advice as this would constitute an “unauthorized practice of law” which is prohibited by state law.

Every U.S. state has its own statutes regarding the unauthorized practice of law, and the severity of the charges for doing so can range from a misdemeanor to a felony. However, the definition of what constitutes unauthorized practice of law only varies slightly between jurisdictions. Per the Santa Clara law review, the generally accepted definition of the practice of law is “legal advice and counsel and the preparation of legal instruments and contracts by which legal rights are secured.”

Since your real estate agent is not working for you as a licensed attorney, they legally cannot advise you on specific legal matters and cannot prepare legal documents required to sell your home.

“It’s a very slippery slope,” warns Wordelman.

“A Realtor® can say what’s typical, and can answer general questions about home-selling contracts, but agents should definitely refer clients to legal experts for more in-depth questions about their specific situation.”

Here are a few examples of legal questions a real estate agent can’t answer:

• Does this count as a breach of contract according to the purchase agreement?
• Could you draft a covenant that will restrict how the new owner can develop on the land I am selling them?
• Are there legal consequences to selling my home while I’m going through a divorce?

Instead, direct these questions to a real estate attorney. Depending on your state, you may even be required to have an attorney present at closing. You can find a real estate lawyer near you with an online directory such as Avvo. The site includes ratings and reviews of lawyers, so you can know for certain that you’re hiring the best person to answer your legal questions.

3. Questions soliciting answers that would violate the Fair Housing Act

Your real estate agent can’t answer requests that would violate the Fair Housing Act, a federal law that prohibits discrimination in the sale or rental of housing.

The Fair Housing Act states that it’s “unlawful to refuse to sell or rent after the making of a bona fide offer or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin.”

On top of the federal fair housing laws, states also set additional regulations. Depending on your state, these laws may also prohibit discrimination on the basis of:

• Age
• Gender expression or identity
• Genetic information
• Marital status
• Medical condition
• Sexual orientation
• Military or veteran status
• Primary language
• Source of income

To remain compliant with the Fair Housing Laws, your real estate agent will always default to the most conservative answer when you ask them questions about deciding who you sell your home to. For this reason, the following questions are better left to real estate attorneys:

• Can I market my home as “family-friendly?”
• Is it possible to make sure that I sell my home to a family in my community?
• My neighborhood has excellent crime statistics. Can I use this to market my home?
• Can I specifically choose a family that shares my religion when accepting an offer for my property?

All of these questions directly or indirectly prompt your agent to give you advice about something that could potentially limit the availability of your home to a protected group. Ultimately, it’s your decision to accept an offer or not, but you don’t expect an agent to screen buyers based on any of the above criteria on your behalf.

4. Requests to conceal known property issues with buyers

In most states, sellers are required to disclose any known material defects of their home to buyers. If you fail to disclose important details about your home, buyers may take legal action to hold you financially liable.

Wordelman shares that real estate agents are trained to advise sellers to “disclose, disclose, disclose.” For this reason, agents are usually required to err on the side of caution. Basically, this means that your agent is always going to advise disclosure when asked questions like:

• Can we hide the water stains on the ceiling with paint?
• Our basement leaks, do we need to mention it if we’ve fixed it ourselves?
• Is it possible to avoid mentioning a recent death in the house?
• Do we need to tell buyers about our noisy neighbor?

Review your state’s specific disclosure requirements for more information on seller disclosures. If you require legal advice on a complicated disclosure issue, consult a licensed attorney.

5. Questions asking for financial advice

Similar to legal advice, real estate agents are also unqualified to give you specific advice about the financial aspects of selling your property. While an agent can tell you your home’s market value and whether or not it’s a good time to sell, they can’t tell you whether or not selling is the right financial decision for you or your family.

Direct questions like these to a financial advisor:

• How much will I owe in capital gains tax?
• Are there any tax exemptions or benefits I can make use of?
• How long should I wait before claiming exemptions on the sale of my primary residence?
• What should I do with my home sale proceeds?
• Will I be able to pay off my mortgage by selling my home?

You can find a financial adviser through The National Association of Personal Financial Advisor or a customer review website like Yelp or Thumbtack. 

Now, for some questions your real estate agent can answer

Outside of these categories, real estate agents are ready to answer your biggest (and smallest) questions about your home sale.

Here are some questions that are great to ask your real estate agent:

• What do local buyers want to see in a home?
• What remodeling projects have the highest return on investment?
• How should I stage my home to attract buyers?
• Where are the best places to advertise my listing?
• Should I consider selling to an investor?
• When is the best time to put my home on the market?
• What can I do to speed up my sale?
• How can I fetch the highest price for my property?

A top real estate agent will have a thorough knowledge of the local housing market as well as plenty of experience navigating the complex process of selling a home. They can also refer you to experienced professionals, such as attorneys, financial advisors, and home improvement specialists to tackle questions outside of their wheelhouse.

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