What is a Gratuitous agent in real estate?

Most of the time a REALTOR wants to be making money if they are practicing being a REALTOR. In order to make money then they have to have an exclusive buy agency with their client to be guaranteed a commission. With being a gratuitous agent, you will not have any contract on paper so you will not be guaranteed any commission with being a gratuitous agent, you are mostly doing the work from the kindness of your heart.

The definition of a gratuitous agent is- a person who is not paid by a principal of the work that they do. A person who acts as a gratuitous agent can never be forced to work as an agent. However, a person acting as a gratuitous agent has to follow a principle of good faith. A gratuitous agent has to abide by the principal’s instructions once they undertake to act as an agent.

So what are some examples of being a gratuitous agent?

An example of this would be if you are finding people a place to rent. There really is not much money to helping people find places to rent and you do not have to have an agency with them because there is not a commission. If you are helping somebody find a place to rent then you are doing it hoping that they will buy a house with you later on down the line. You would be working as a gratuitous agent in this situation because you would not be putting the relationship onto a contract.

Another example of a gratuitous agent in real estate would be if you are selling a home for a friend but you do not want to charge them for it. In North Carolina, the sellers usually pay the agents in a real estate transaction. If you did not want to charge the 3% then you could work as a gratuitous agent and sell the house just to be nice for a friend.

What is the difference between a gratuitous agent and a regular agent?

The difference is that the agent is not getting paid and that the agent does not owe the principal anything besides good faith. A regular agent will owe the principle OLD CAR which is:

-Obedience

-Loyalty

-Disclosure

-Confidentiality

-Accounting

-Reasonable skill and Care

If you are a gratuitous agent then you just owe the principal good faith and not everything else. With being a gratuitous agent, you have a lot more freedom to do as you please but then again, you are not getting paid for any of your services.