Key Takeaways
- All New Mexico brokers owe certain duties to ALL buyers and sellers in every transaction
- Brokers must provide honesty, reasonable care, and ethical conduct to all parties
- Adverse material facts known by the broker must be disclosed in writing to all parties
- Brokers must disclose potential conflicts of interest including brokerage relationships with other parties
- Confidential information from prior agency relationships must be maintained unless disclosure is required by law
Duties Owed to All Parties
New Mexico law (NMAC 16.61.19.8) requires that all brokers owe certain duties to ALL buyers and sellers in every transaction, even if the broker is not representing them.
Universal Broker Duties
Duties to ALL Parties
| Duty | Description |
|---|---|
| Honesty | Deal honestly with all parties |
| Reasonable care | Exercise reasonable care in all dealings |
| Ethical conduct | Maintain professional ethical standards |
| Legal compliance | Comply with local laws and regulations |
Disclosure Requirements
Brokers must provide written disclosure of:
| Disclosure Type | Details |
|---|---|
| Adverse material facts | Actually known facts about property or transaction |
| Financial ability | Known facts about parties' ability to complete transaction |
| Conflict of interest | Any potential conflict in the transaction |
| Other relationships | Brokerage relationships with other parties |
Adverse Material Facts
What Must Be Disclosed
Brokers must disclose adverse material facts actually known about:
- The property
- The transaction
- The financial ability of parties to complete the transaction
What is NOT Required
| NOT Required to Disclose | Reason |
|---|---|
| Fair housing protected info | Federal/state fair housing laws |
| Human Rights Act info | NM Human Rights Act protection |
Important: Adverse material facts requiring disclosure do NOT include any information covered by federal fair housing laws or the New Mexico Human Rights Act.
Conflict of Interest Disclosure
Brokers must disclose in writing:
- Any potential conflict of interest in the transaction
- Any brokerage relationship with other parties to the transaction
Example: If a broker has a listing agreement with the seller and is also working with a buyer on the same property, this must be disclosed to both parties.
Confidentiality Requirements
Maintaining Confidentiality
Brokers must maintain confidential information learned in the course of any prior agency relationship unless:
| Exception | Description |
|---|---|
| Written consent | Former principal authorizes disclosure in writing |
| Required by law | Disclosure is legally required |
Information That Must NOT Be Disclosed
Unless authorized in writing, a broker representing a seller/owner shall not disclose to the buyer/tenant:
| Protected Information | Example |
|---|---|
| Acceptable price | That seller will accept less than asking price |
| Financing terms | That seller will agree to other financing |
| Motivation | Seller's motivation for selling/leasing |
Key Rule: These protections apply even in dual agency situations.
Timely Presentation of Offers
All brokers must:
- Present all written offers in a timely manner
- Present offers truthfully without misrepresentation
- Present offers even if the broker believes they won't be accepted
Personal Interest Disclosure
When a broker has a personal interest in a transaction, written disclosure is required:
| Situation | Disclosure Required |
|---|---|
| Broker is buyer/seller | Yes - to all parties |
| Family member involved | Yes - to all parties |
| Financial interest | Yes - to all parties |
| Ownership interest | Yes - to all parties |
Compensation Disclosure
If a broker will receive compensation from more than one party:
- Must disclose to all parties
- Must be disclosed in writing
- Must be disclosed before compensation is received
Which duties do New Mexico brokers owe to ALL parties in a transaction?
What must a New Mexico broker do if they know adverse material facts about a property?
Unless authorized in writing, what information must a seller's broker NOT disclose to a buyer?