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On June 12, 2012, VAR hosted a live webinar to walk members through the 2012 changes to VA real estate agency law. This is the presentation we used. For the full story on the 2012 changes, check out http://www.VARealtor.com/Agency to access articles, videos, and more.
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AGENCY LAW CHANGES:WHAT DO THEY MEAN FOR YOU AND YOUR AGENTS?
BEFORE WE BEGIN
Audience members will not have speaking capabilities on this call
However, we encourage all attendees to submit questions through the question field on the Go To Meeting control panel
There will be a Q&A portion at the end of the presentation
All questions submitted through the Go To Meeting control panel are private; they cannot be seen by other audience members
WHAT WE’LL COVER• the upcoming changes to the current agency law;
• a review of the standard disclosure forms and other supplemental forms that will be available later this month;
• an outline of resources that will be made available to brokers and agents to inform and help them adapt to the changes;
• a few FAQs we’ve already been hearing around the state; and
• a Q&A period for additional questions you may have
AGENCYChanges to Virginia agency law take effect July 1, 2012.
In the coming months, VAR will provide a variety of resources to help you adapt to the revisions, including videos, webcasts, articles, new forms, and classes.
WHYTHE CHANGE TO THE LAW?
1. INFORM THE CONSUMER. The law is to make sure consumers are fully informed about the real estate services they’ll receive and the nature of the relationship with the licensee.
2. MITIGATE REALTOR® LIABILITY. The law is designed to protect licensees by making sure full disclosure is provided and the nature of brokerage relationship is reduced to writing. It’s to eliminate much of the consumer confusion that can come back and bite the licensee.
3. DISCOURAGE OPPORTUNISITIC DUAL AGENCY.The law is intended to make sure that licensees who practice dual agency are fully informing consumers about the risky nature of that relationship.
AGENCY LAW CHANGES
All licensees must have written brokerage agreements with consumers they represent. These agreements must, at a minimum: Provide a list of services that the
agent will provide; Provide a schedule of fees that
will be associated with service, and when payable; and
Provide a definite termination date.
1. GET IT IN WRITING
INDEPENDENT CONTRACTORmeans a real estate licensee who:
• enters into a brokerage relationship based upon a brokerage agreement that specifically states that the licensee is acting as an independent contractor and not as an agent;• has obligations agreed to by the parties in the brokerage agreement; • is required to
• maintain client confidentiality;• exercise ordinary care; • account for a client’s money and property; • disclose material facts to client regarding the property and/or the transaction, and disclose material adverse facts/defective drywall to prospective purchasers and tenants;• treat all parties honestly; and• disclose the brokerage relationship to all parties; but
• does not have any other duties of a standard agent under Sections 54.1-2131 through 54.1-2135 (marketing, negotiating, etc.)
Dual agents and representatives must provide enhanced disclosure of limitations on what dual agents can and cannot do for parties to a transaction.
There are exceptions for situations where existing clients come together in a common transaction, and for independent contractors.
2. ENHANCED DISCLOSURES FOR DUAL AGENCY
AGENCY LAW CHANGES
Licensees must take a three-hour course on the provisions of the agency statute and the changes made in the legislation.
You may exempt yourself from this only if you agree in writing that you will not practice residential standard agency during your license term.
3. MANDATORY AGENCY COURSE
AGENCY LAW CHANGES
AGENCY COURSE TIMINGAgents must take a three-hour course on the provisions of the agency statute and the changes made in the legislation.
This means that if your current license expires after July 1, 2012, you may take the three-hour agency course at any time, beginning right now. In fact, if your license expires in July 2012, you will need the course very quickly.
However, if your license expires in February through June of 2012, you should wait to take the course until after you have renewed your license. You may take the course now, but you will need to take it again (for credit) in your next license cycle.
NEW AGENCY DISCLOSURE FORMS• DISCLOSURE OF DUAL AGENCY OR REPRESENTATION – RESIDENTIAL
• DISCLOSURE OF DUAL AGENCY OR REPRESENTATION – COMMERCIAL
• DISCLOSURE OF BROKERAGE RELATIONSHIP FOR UNREPRESENTED PARTIES
• DISCLOSURE OF DESIGNATED AGENCY OR REPRESENTATION
In addition to these new required forms, we’ve also created several additional resources to help you adapt to the changes:• INDEPENDENT CONTRACTOR LISTING AGREEMENT
• EXCLUSIVE BUYER BROKER AGREEMENT (REDUCED IN SIZE)
• NON-EXCLUSIVE BUYER BROKER AGREEMENT (REDUCED IN SIZE)
• TWO CONSUMER INFORMATION PIECES:
• DISCLOSURE OF BROKERAGE RELATIONSHIP INFORMATION FORM
• CONSUMER INFORMATION REGARDING WRITTEN BUYER BROKER AGREEMENTS
DISCLOSURES OF DUAL AGENCY OR REPRESENTATIONRESIDENTIAL
2 PAGES
WWW.VAREALTOR.COM/STANDARDFORMS
DISCLOSURES OF DUAL AGENCY OR REPRESENTATIONCOMMERCIAL
1 PAGE
WWW.VAREALTOR.COM/STANDARDFORMS
DISCLOSURE OF BROKERAGE RELATIONSHIPFOR UNREPRESENTED PARTIES
1 PAGE
WWW.VAREALTOR.COM/STANDARDFORMS
DISCLOSURE OF DESIGNATED AGENCYOR REPRESENTATION
1 PAGE
WWW.VAREALTOR.COM/STANDARDFORMS
INDEPENDENT CONTRACTOR AGREEMENT5 PAGES
WWW.VAREALTOR.COM/STANDARDFORMS
BUYER BROKER AGREEMENTAVAILABLE IN EXCLUSIVE& NON-EXCLUSIVE
2 PAGES
WWW.VAREALTOR.COM/STANDARDFORMS
SHORT BUYER BROKER AGREEMENTNON-EXCLUSIVE ONLY
1 PAGE
WWW.VAREALTOR.COM/STANDARDFORMS
YOUR REALTOR’S ROLE2-PAGE PIECE DESIGNED TO OUTLINE
1.WHY CONSUMERS SHOULD USE A REALTOR®
2.WHY A BROKERAGE AGREEMENT IS NECESSARY
WWW.VAREALTOR.COM/REALTORSROLE
RESOURCES FOR BROKERS & AGENTSWEBSITEMAGAZINEEDUCATIONSTANDARD FORMSCOURSE CALENDARVIDEOSHOTLINE Q&AWEBINARS
VAREALTOR.COM/AGENCY
VAREALTOR.COM/AGENCYCLASS CALENDAR CURRENTLY SHOWS MORE THAN 120 AGENCY COURSE OFFERINGS ACROSS THE STATE
WWW.VAREALTOR.COM/AGENCY
COMMONWEALTH MAGAZINEAPRIL: AGENCY PRIMERJUNE: AGENCY CHANGE TUTORIAL
WWW.VAREALTOR.COM/COMMONWEALTH
DO I HAVE TO HAVE
A WRITTEN AGREEMENT TO SHOW SOMEONE A HOUSE THAT IS NOT MY LISTING?
Yes. But…
It doesn’t have to be exclusive
It doesn’t have to be long-term
It doesn’t have to be for compensation
It doesn’t have to be an agency relationship
WHEN DO YOU NEED TO DISCLOSE YOUR BROKERAGE RELATIONSHIP?
The big questions is:
Is the consumer already represented?
If no:
“Substantive” discussion
Specific property
Actual prospect who is not your client and who is not represented by any other licensee
WHAT IS SUBSTANTIVE?
Pricing questions
Motivation
Repairs/property condition
QUESTIONS & [email protected]