THE SCOOP | Changes for Bright MLS
With the upcoming policies for the real estate industry, I feel it is vital to keep our consumers informed. In Delaware, the 'changes' in representation and commission are no longer optional. Here is are a few facts you should know...
Effective August 17, 2024, consumers MUST sign all mandatory forms AND formally hire a REALTOR before touring any home. The consequence as a professional is a fine of up to $10,000. This is non-negotiable and pertains to EVERY member of the public (including relatives and colleagues).
Buyer's Agent compensation is no longer allowed to be advertised separately on Multiple Listing Services (MLS); however, can be marketed or referred to as a concession. Seller Concession maximums are still applicable based on loan type.
Buyers actively shopping and sellers with homes that have not yet sold will need to sign amendments to their current agreements. Clients currently under contract may not need to sign anything new.
Stay tuned for more updates on this and other industry news!
MANDATORY EXP FORMS
Bright MLS is the enforcer and can audit every listing as early as 08/17/2024.
I cannot speak for other brokerages, but our new forms were distributed internally on 08/01/2024 and will be ready for immediate use on 08/14/2024. For additional information, check out these free resources courtesy of Bright MLS.
Bright MLS Disclosure: CONCESSIONS are OPTIONAL to be disclosed; however, not binding unless in the purchase agreement. Once the property closes, compensation/commission can be input separately from the buyer's closing cost concession.
Exclusive Buyer/Tenant Agency (Representation) Agreement OR Single Property Buyer Broker: This is a promise to pay agreement to hire the agent for renting OR buying. The form says the buyer will pay for their agent; however, we can request a concession for the seller to compensate.
Wiring Fraud Advisory Notice: Many attorneys already have this language in their email signature.
Listing Agreement + Amendment to Listing Agreement
Vacant Land Listing Agreement and Amendment
NOTE: These are in addition to and will NOT replace the previous documents utilized to hire a REALTOR. In addition, the Delaware Agreement of Sale has been revised to expressly indicate where the Earnest Money Deposit (EMD) will be held as well as formally applying any seller concessions.
WHAT TO EXPECT AS A CONSUMER
Now, more so than ever, aligning yourself with a professional will be vital to successfully achieving your real estate goals. All parties need to be transparent - either work with ONE realtor or sign multiple one-time agreements. However, if you are not keeping track of what you are signing, then you may be required to pay multiple agents.
Expect compensation percentages to change OR even upfront retainer fees for both sellers and buyers.
Lenders may or may not need to have a copy of the representation agreement to provide estimated cash to close for buyers. In addition, the Closing Attorney may also need this representation agreement.
Multiple Counties
You can have a separate buyer representation agreement with a REALTOR in New Castle County vs. Kent County at the same time BUT must disclose. Cannot go back and forth between agents or risk having to pay both.
Multiple Clients interested in the SAME property
Should this occur, the agent must notify the client if they have another client submitting an offer on the same home. If a client is not comfortable, another agent can be assigned to write the offer.
Open Houses
Attend with your designated REALTOR or expect to sign a Single Property Buyer Broker form before entering the home to tour.
Sellers
When listing the home for sale, the seller(s) will still compensate their agent based on the terms of the Listing Agreement. They can (and are) still offering to compensate the buyer's agent; however, it is advertised in the private agent notes or elsewhere in the listing.
Sellers with homes currently on the market as coming soon, active or pending will need to sign an addendum to their listing agreement as well as the new Bright MLS Disclosure.
Sellers can 'hire' the agent and then post-date the marketing start date to accommodate their needs. Previously, a resale property had to be listed within 21 days and new construction was 2 years.
Buyers
Buyers can still negotiate to have the seller compensate their agent as a concession in the Agreement of Sale. If not, then the compensation indicated in the representation agreement will be added to their closing costs.
Now, when your agent shows you a home, they may not know IF they are going to get paid from the transaction. There are several ways a buyer's agent can be paid:
Directly from the seller upon closing
From buyer through the concession negotiated in the Agreement of Sale
Directly from the buyer
The buyer can dictate HOW they want to apply the seller concession.
ADDITIONAL RESOURCES
DAR Dispelling Myths about NAR Settlement
Corrections: NAR does NOT set commissions
_______
NEW PERMANENT BUSINESS HOURS
Tuesday to Friday 9:00 AM - 6:00 PM. All messages are returned during this time.
While I would love to accommodate everyone, please respect that I am one person. Every client deserves uninterrupted one-on-one time without distractions. If you have worked with me, you may or may not notice I do not answer calls during showings for that exact reason. There is no housing-related emergency vital enough to require my services outside of these dedicated hours - especially if the attorney or lender is also not also available.
Messages sent outside of these times (such as this e-mail) are most likely automated or scheduled responses - no team member will be notified outside of these business hours as the out of office automations are triggered for all phone lines and business systems.
Our booking link is automatically connected to my calendar so all inquiries, calls, and listing appointments are scheduled online: BOOK AN APPOINTMENT.
If you would like to tour a home - REQUEST A SHOWING. Even if I am personally not available for a showing, the appointment request will route to the available team member BUT only if this link is used directly.
GET IN TOUCH: Contact us directly at (302) 217-6247 OR hello@CharmingBelleHomes.com
_______
FREQUENTLY ASKED QUESTIONS (FAQs)
Q: Do I have to sign?
YES - If you wish to work with us. The representation agreement can be to see a single property for one (1) day OR for a certain timeframe [eg. mine are for the calendar year]. They can be terminated in writing at any time, but they state the following:
Breakdown the expectations of service - roles, duties, and responsibilities of the agent
Discloses any payments due to the brokerage [this figure is the MAXIMUM compensation]
Q: Is it legal to pay a commission?
YES - The NAR ruling disallows Bright MLS to advertise cooperating brokerage fees (or commission). However, it was replaced with a field for CONCESSIONS.
Q: Can't you just show me the house?
NO - Not until you sign the mandatory documents. Starting August 17, 2024, no licensed REALTOR will be allowed to open a lock box to show a home without the consumer signing a representation agreement. Remember, REALTOR is trademarked - we are licensed by the National Association of REALTORS (NAR) as well as the State and Local jurisdiction. Not every salesperson is a licensed REALTOR (for example: new construction representatives).
Q: Will standard commissions go away?
CLARIFICATION - There is no standard commission, actual paid commissions range as low as 1% (if not zero) and as high as 8%.
REALTORS are independent contractors and as a small business owner, we can charge a flat fee, commission based on percentage, itemized invoicing, and transaction-related fees. Many brokerages choose the commission model for simplicity.
Q: Sellers are NOT REQUIRED to pay buyer agents?
TRUE - Sellers NEVER had to pay a minimum buyer agents, the commission was always negotiable. Remember, NAR always said the fee could be as low as $0; however, each brokerage has their requirements and allowances.
Some prominent builders pay between 0% - 2% to buyer agents.
