Mississippi REALTORS® Institute equips REALTORS® with the tools and knowledge to navigate NAR’s recent settlement-driven changes when representing sellers. These guidelines are designed to uphold ethical standards, enhance transparency, and clarify seller-agent relationships. Following these updated practices will help REALTORS® build trust with their clients and maintain compliance.
Dos When Working with Sellers
Emphasize Your Value as a REALTOR®
At the beginning of your relationship with a seller, underscore your unique expertise as a REALTOR® and how it benefits them. REALTORS® adhere to a strict Code of Ethics, which prioritizes client interests. To help sellers understand the benefits of working with a REALTOR®, share this Guide on REALTORS®’ Duty to Put Client Interests Above Their Own to illustrate how REALTORS® work differently than other real estate licensees.
Explain Offers of Compensation and Their Potential Benefits
Help sellers understand what an offer of compensation entails and the potential advantages of covering all or part of the buyer’s agent fees. Offering compensation can expand the buyer pool by reducing upfront costs for prospective buyers, especially for first-time buyers and those from underserved communities. Emphasize that the choice to offer compensation is always the seller’s and should align with their business practices.
For more information, consider sharing the Consumer Guide: Offers of Compensation.
Ensure the Seller Understands Their Options Before Signing
Before signing a listing agreement, make sure the seller knows their options regarding compensation and terms. Highlight that compensation is fully negotiable and not set by law, enabling them to make informed decisions.
Get Written Approval for Compensation Offers
If you’re offering compensation to another agent, get written approval from the seller beforehand. This transparency ensures that the seller is fully aware of any payment arrangements that may affect their transaction.
Present All Offers and Ensure Fairness
Present every offer to the seller and treat all buyers equitably. Compliance with fair housing laws and the REALTOR® Code of Ethics requires that REALTORS® act impartially and avoid discrimination. Sellers must be treated fairly regardless of factors such as race, gender, or other protected characteristics.
Maintain Open Communication with Industry Peers
Effective communication with other brokers, agents, and professionals benefits both the seller and the transaction. Staying accessible to appraisers and other industry professionals can facilitate smoother transactions and help you secure the best offers for your clients.
Follow State and Local Laws
As a Mississippi REALTOR®, it’s essential to be familiar with state and local laws affecting seller representation. Consult with MRI or your local REALTOR® association regularly for updates to ensure your practice is compliant. Check on the Mississippi Real Estate Commission website for the License Law and the MREC Administrative Rules and Regulations.
Don’ts When Working with Sellers
Avoid Using MLS to Offer Compensation
Under the settlement, offers of compensation cannot be made through MLSs that have opted into the settlement. Avoid using MLS data fields for this purpose, as doing so violates current guidelines.
Don’t Share Listing Agreements with Competitors
Protect the seller’s confidential information by not sharing signed listing agreements with competitors. These documents contain sensitive details, including compensation, that are critical for negotiation.
Don’t Communicate Compensation Without Seller Approval
If a seller decides to authorize an offer of compensation, they dictate when and how that information is shared. Follow the seller’s instructions carefully regarding if, when, and how compensation details are disclosed to potential buyers or their agents.
Don’t Request Copies of Written Buyer Agreements
Respect MLS policies regarding buyer agreements. Avoid requesting copies of written buyer agreements, as MLS policies govern these requirements.
Frequently Asked Questions (FAQ)
Why is a written listing agreement necessary?
A written listing agreement provides clarity, outlining the terms of service and the responsibilities of both the REALTOR® and the seller. This helps establish a clear, transparent working relationship.
What key elements should be included in a listing agreement?
The agreement should detail the services provided, the compensation structure, and other terms that define the relationship between the REALTOR® and the seller. This transparency benefits both parties.
How can REALTORS® explain offers of compensation to sellers?
Explain that offering compensation may attract more buyers, especially those needing financial support for agent fees. However, the decision to offer compensation is entirely up to the seller.
What are the consequences of failing to comply with the new NAR requirements?
REALTORS® who don’t follow these guidelines risk losing MLS access, NAR membership, or facing legal repercussions. Adhering to these best practices helps REALTORS® avoid these potential issues.
Do REALTORS® need written approval from sellers to offer compensation to buyer agents?
Yes, any offer of compensation must be approved in writing by the seller to ensure full transparency and compliance with the settlement.
Where can I find more resources on listing agreements and compliance?
Mississippi REALTORS® Institute offers in-person and online courses to support REALTORS® in understanding and applying these guidelines. For more information, visit our Course Catalog or contact MRI directly.
Take Action Now for Compliance and Success
Take proactive steps to enhance your expertise. Join our upcoming in-person or online classes to keep your skills sharp and deliver top-tier service to your clients. For additional support, the Mississippi REALTORS® Institute team is here to help. Visit our contact page or call us directly at 601-932-5241. Your success is our commitment, and we’re with you every step of the journey.