Key Takeaways
- New Mexico requires brokers to provide the Broker Duties Disclosure and Acknowledgement Form to all consumers
- The disclosure must be provided before generating or presenting any written document that could become an agreement
- Three brokerage relationship types are available: Transaction Broker, Exclusive Agency, and Dual Agency
- Brokers must obtain written acknowledgement from parties that disclosures have been made
- All brokers owe certain duties to ALL parties in a transaction, regardless of representation
Broker Duties Disclosure Requirements
New Mexico has specific requirements for broker disclosure under NMAC 16.61.19.8 (Broker Duties; Disclosure).
Purpose of Broker Duties Disclosure
New Mexico law requires brokers to:
- Disclose broker duties owed to buyers, sellers, landlords, and tenants
- Explain brokerage relationship options available in New Mexico
- Obtain written acknowledgement that disclosures were made
Key Point: The disclosure must be made before the broker generates or presents any written document that could become an express written agreement.
When to Provide Disclosure
The Broker Duties Disclosure must be provided:
| Timing | Requirement |
|---|---|
| Before any written document | That has potential to become an express written agreement |
| Before confidential information | Is exchanged or discussed |
| At first substantive contact | With buyer, seller, landlord, or tenant |
Timing Examples
| Situation | When to Provide |
|---|---|
| Listing presentation | Before presenting listing agreement |
| Buyer inquiry | Before discussing needs or showing property |
| Lease negotiation | Before presenting lease agreement |
| Property management | Before management agreement |
Written Acknowledgement Required
Brokers must obtain written acknowledgement from the applicable party that:
- Broker duties have been disclosed
- Brokerage relationship options have been explained
Important: The acknowledgement must be written. Verbal acknowledgement is not sufficient.
Broker Duties Disclosure Form
The NMREC provides the official Broker Duties Disclosure and Acknowledgement Form which must be used for compliance.
Brokerage Relationship Options in New Mexico
New Mexico recognizes three types of brokerage relationships:
1. Transaction Broker
A transaction broker is a qualifying broker, associate broker, or brokerage that:
- Provides real estate services
- Does NOT enter into an agency relationship
- Owes limited duties to all parties
| Feature | Transaction Broker |
|---|---|
| Agency relationship | None |
| Loyalty | Neutral to all parties |
| Advocacy | Limited - facilitates transaction |
| Confidentiality | Limited |
2. Exclusive Agency
An exclusive agent represents:
- One party only (buyer OR seller, landlord OR tenant)
- Owes full fiduciary duties to that party
- Cannot represent the other party in the same transaction
| Feature | Exclusive Agency |
|---|---|
| Agency relationship | Yes - one party |
| Loyalty | Full loyalty to client |
| Advocacy | Full advocacy for client |
| Confidentiality | Full protection of client information |
3. Dual Agency
Dual agency occurs when:
- One broker represents both buyer and seller in the same transaction
- Requires written consent from both parties
- Broker becomes a neutral facilitator
| Feature | Dual Agency |
|---|---|
| Agency relationship | Yes - both parties |
| Loyalty | Neutral - cannot favor either |
| Advocacy | Limited - cannot advocate for either |
| Confidentiality | Cannot disclose one party's position to the other |
Comparison Table
| Relationship | Represents | Loyalty | Consent Required |
|---|---|---|---|
| Transaction Broker | Neither | Neutral | Disclosure only |
| Exclusive Agency | One party | Full | Written agreement |
| Dual Agency | Both parties | Neutral | Written consent both |
When must a New Mexico broker provide the Broker Duties Disclosure?
Which brokerage relationship in New Mexico involves NO agency relationship?