Wrongdoing by Your Real Estate Agent? Five Steps to File a Complaint

A Deeds.com Quick-Start Guide

Have you suffered a loss that you believe was the fault of your agent? Do you believe there was a lapse in professionalism? Perhaps even unethical conduct on the part of an agent?

Here’s a quick-start guide to addressing the situation, in five steps.

Step 1: Speak With the Agent Directly.

Perhaps you’ve hired an agent who is slow to respond to you or to other key parties. Or perhaps the agent said or did something offensive or unfair.

Your first response might involve going to the agent and explaining the problem from your perspective. Then see if the agent will make an apology, attempt to right the wrong, or explain the problem in a different light, so that you can arrive at some understanding.

If you cannot repair the client-agent relationship, it might be best to find a different agent. In most states, agent contracts allow the client and broker to terminate the agreement early.

But before you try to cut ties, note the next level of recourse available to you. That would be going to the broker that your agent is affiliated with.

Step 2: Speak With the Broker Who Employs the Agent.

Schedule a call with the company’s principal broker. Explain the instance(s) of unprofessionalism from your point of view. It’s possible that a frank discussion can clear up misunderstandings and resolve the problem.

The broker would also be empowered to end the contract through which you hired your agent, if you want that to happen and the agent hasn’t done so at your request.

Alternatively, the broker may be able to substitute a different agent for the one you’ve been working with.

Will there be accountability? Yes. If the broker determines that the action or inaction of your agent failed to measure up to company standards of professionalism, the agent will likely receive a negative letter or reprimand. Companies are concerned about lawsuits and want to correct or make up for any problem the agent might have caused.

Step 3: Speak With the Agent’s Trade Association.

Did the agent’s action or inaction rise beyond mere unprofessionalism? Could it have possibly violated ethical standards? There’s a professional association that deals with such things.

The National Association of REALTORS® (NAR) maintains local real estate boards. If your agent belongs to the agent’s association, this is an appropriate recipient of an ethics complaint.

If you believe a Realtor® has violated any Articles of the Code of Ethics, you can file an ethics complaint within 180 days from the time you knew or should have known about the unethical conduct.

But how do you know if your agent has actually offended the ethics code? You can look at the NAR Code of Ethics. The local association branch can officially determine that it’s been violated, and issue penalties. Each state and branch has its own procedures for taking complaints. For example, here’s the Pennsylvania REALTOR® code of Ethics & Standards.

Eyes glazing over? There’s help! The local branches of NAR maintain Grievance Committees, and they can offer help with a complaint so it meets form and content standards.

Dealing with an association is a slower process than going right to the broker involved. What goes on to make it a longer process? The preparation for being heard. First, anyone wanting to file an ethics complaint with NAR must point to a specific article out of the 17 articles of the REALTOR® code. Refer to NAR’s Standards of Practice for more on these articles. This will support your preparation for an ethics hearing to determine whether your complaint is well founded.

Ultimately the agent could be fined, reprimanded, and/or compelled to (re)take professional ethics courses.

What kinds of resolution must the local association not offer? A local board or branch may not:

• Cancel a home purchase agreement or a deed transfer.

• Make an agent pay for property damage or force other monetary restitution.

• Declare whether the agent broke state laws or regulations.

• Suspend or revoke any licensing issued by the state.

That said, if there are serious (usually multiple) infractions, NAR membership may be suspended or revoked.

Step 4: Speak With Your State Real Estate Commission.

Now, what if the agent or their broker is not associated with NAR? You can still get results by taking your concerns to the state licensing authority.

Anyone who has serious reason to believe their agent violated the state’s licensing laws can go to the state commission with a complaint.

Do a search for regulatory agencies in your state. Pull up the website for contact information, complaint procedures, and rules regarding how the state’s licensed real estate agents must carry out their work and interact with clients and others.  

Again, let’s take Pennsylvania as an example. Its Real Estate Commission takes complaints. If the state commission determines that the violation in fact happened, the agent may receive a fine or formal reprimand. The local branch of the agent’s professional association will be notified.

In cases of severe misconduct, the agent’s ability to work in real estate could be in jeopardy.

The determination could take a long time, and accountability will not happen until long after your current real estate transaction. But you might feel it’s worthwhile to take a serious ethics lapse to the commission, in the public interest.  

Here again, each state’s a little different, but core ethical rules tend to be uniform.

Step 5: If All Else Fails, Sue in Court.

As you now know, the question of whether laws or real estate regulations were violated can be made by the state’s licensing body. It can also be decided in court. A court can award damages for harm done on account of the misconduct.

When real estate agents or brokers are taken to court, it’s often because of misrepresentation and failure to disclose a material issue with the home involved. For the misrepresentation to rise to the level of a strong court case, key structural features (such as the home’s foundation), environmental hazards, or easements and/or property borderlines are usually involved.

The court will judge whether the agent made an innocent error or whether the agent was negligent. Or even perpetrating a fraud to make a profit.

If you believe you have a case for the court to decide, you’ll want to call an experienced real estate lawyer in your area. This person can let you know what evidence you’ll need, what experts must be hired, and indeed how strong your case is (if at all).

And That’s a Wrap!

We cannot give legal or financial advice. Yet we trust this quick-start guide helps readers to look up the right information, and go through the right actions, with the right people.

The first step is to try to resolve the situation directly with the agent. If necessary, you can now look up and point to the rules that should apply. Speak with the principal person at the brokerage if you’re not making headway with the agent.

Then, it’s the local REALTOR® branch (if applicable). Then, your state’s regulatory body.

Finally, there are courts. Getting legal representation can be expensive. Cases are time-consuming. But courts can provide monetary damages for actual harm. In certain cases, taking a matter to court is worth it. Usually, it’s possible to resolve the matter and/or get a different agent from the brokerage well before that final option.