after slamming California Association of Realtors (CAR) for its Draft Buyer Representation Agreement, Consumer Federation of America (Court of Final Appeal) on Tuesday published proposed criteria for assessing buyer representation agreements.
The CFA said the proposed standards were developed after receiving requests from several unnamed real estate companies. CFA Senior Fellow Stephen Brobeck created the standard.
“These standards will help regulators, consumer groups and the industry itself assess the fairness of new buyer agreements,” Brobaker said in a statement. “The CFA has shown that some revised contracts are deeply anti-consumer and Others are fairer to buyers.”
The standards include 15 factors that real estate leaders should consider when developing buyer representation contracts. These standards focus primarily on the form and content of the contract.
It is worth noting that the CFA recommended in the standards that information about the agent’s remuneration should be listed at the beginning of the form and clearly labeled. The regulator also advises that both brokers and buyers can terminate the agreement at any time without paying any fees; in the event of a dispute, the buyer should not be required to engage in mediation or arbitration; and that any concessions from the seller should be given to the buyer, not the broker, to Use it as they see fit.
The standard also stipulates the form of the buyer’s contract, and it is recommended that the buyer’s contract should be written in no less than 12-point font and in simple and understandable language.
Other criteria include that the expiration date of the contract should be clearly stated; that disclosure of compensation is negotiable; that commissions should only be paid upon a successful closing; that the contract does not constitute pre-approval of dual agency; and how brokers treat interests in the same property explanations of different buyer customers.
“An easy-to-understand agreement can empower buyers and transform their relationship with their agent,” Brobeck said. “These contracts will reveal how the buyer’s agent is compensated and how the buyer negotiates compensation.”
In June, the Court of Final Appeal issued a report saying CAR’s buyer’s representation agreement was “almost unreadable”. The agreement is necessary for changes in business practices National Association of Realtors National Council Litigation Settlement Agreement.
The Court of Final Appeal also revealed that it had sent the report to Ministry of JusticeA few days ago, the company announced it had launched a formal investigation into CAR’s forms.
Last week, CAR announced plans to release updated tables by the end of the month.
