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Universal vs. General Agent in Real Estate
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What are Universal and General Agents in Real Estate?
There are different kinds of agents in real estate, including (but not limited to) universal and general agents. Anyone who doesn’t work in the real estate field or deal much with this sort of business may not be familiar with these terms. Agents perform tasks and act on behalf of their principals (i.e. clients), but the reach of their power depends upon what kind of agent they’ve been hired to be. Read below for an explanation that will help you grasp the differences between the two.
A universal agent in real estate is an agent who can act on behalf of a principal, with full power. Many times, the universal agent has power of attorney to act on their principal’s behalf. One important thing to know about a universal agent is that there aren’t many. The universal agent is kind of like the unicorn of agents; they are rare. In fact, each principal can only have one universal agent. The universal agent can, in a sense, act like they are the principal. They can even sign legal documents for the principal and purchase and/or sell property for them.
A general agent in real estate is an agent who can perform any and all acts that are associated with the ongoing business that the principal has appointed the general agent to act in. The general agent is not the unicorn of the business, but more like just another horse in the corral. There’s nothing amazingly different about a general agent, who might find himself working as a property manager for his principal. A principal can have more than one general agent, with each general agent handling a particular part of the principal’s business.
Briana has been a real estate agent for over twenty years and knows a lot about the business. She would like to do something different from just helping clients buy and/or sell homes. One of her good friends is an investor and owns several properties. He would like to spend more time with his family, and wants someone in the real estate business to take over operation of his business. He doesn’t want to let it go completely, but he no longer wants all of the responsibility. He and Briana sit down and sign a written agreement. Briana can run his business, and can even sign legal documents for him. In a sense, she will act like she is him for important business matters and make decisions that are binding upon him. She has agreed to be his universal agent, and she is the only person with so much power in his business.
Zach has been in the property management field for many years. He loves helping people find rental property to live in, and there are several agents just like him in his town. There’s a property management company close by that is well-known, and he hears from a friend that they’re hiring. Zach interviews with the main boss at the business and gets hired on to manage some single-family homes and a few small apartment buildings. He has been hired on as a general agent. His boss is responsible for anything Zach does while acting on behalf of his new boss.
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A universal agent can handle ALL of the important business matters for his client. He can sign legal documents for him and may even have a power of attorney. Essentially, the universal agent can make decisions and act on behalf of his client like he is actually the client himself. A general agent is a little different. He still has some power, but not as much as the universal agent. The principal is responsible for what the general agent does and can have many general agents. A universal agent handles very important matters that arise in all areas of the principal’s business, whereas the general agent handles specific business that he’s been charged with. The general agent can be a property manager for the principal while the universal agent handles ‘everything’ for the principal. The universal agent is the unicorn standing at the top of the hill, overlooking the corral holding all the horses (the general agents).
Agents in real estate can perform different tasks for their clients (or principals) based on what the principal has hired them for. If an agent has been hired as a universal agent in real estate, they have a lot of power. Their principal can only have one universal agent, so they are rare in the field. Universal agents are also referred to as ‘the unicorn of agents’. Their client has hired them to run the client’s business as if the universal agent is the client himself. They can sign legal documents for a client and make important decisions such as purchasing and/or selling property. Additionally, a universal agent may have a power of attorney.
The general agent in real estate is different. He or she does have some power, but not nearly as much as the universal agent has. They are hired to handle one particular part of the client’s business while the universal agent can handle everything. The general agent may be one of many general agents that the client has. A general agent may work in the field of property management for his or her client.