agency law changes: what do they mean for you and your agents?

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 that will be required after July 1;

• 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.

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.)

AGENCY LAW CHANGES

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 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 is 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 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

DISCLOSURES OF DUAL AGENCY OR REPRESENTATIONRESIDENTIAL

DISCLOSURES OF DUAL AGENCY OR REPRESENTATIONCOMMERCIAL

DISCLOSURE OF BROKERAGE RELATIONSHIPFOR UNREPRESENTED PARTIES

DISCLOSURE OF DESIGNATED AGENCYOR REPRESENTATION

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

COMMONWEALTH MAGAZINEAPRIL: AGENCY PRIMERJUNE: AGENCY CHANGE TUTORIAL

PLUS: WE’RE UPDATING THE POPULAR REALTOR®’s ROLE BROCHURE

LIVE WEBINARALL BROKER CALL

TUESDAY, JUNE 12, 10 A.M. EDT

FEATURING

• VAR VP OF LAW & POLICY JAY DEBOER

• VAR ATTORNEY BLAKE HEGEMAN

• NVAR ATTORNEY SARAH PETCHER

• RAR ATTORNEY MICHAEL LAFAYETTE

DO I HAVE TO HAVE A WRITTEN AGREEMENT TO SHOW SOMEONE A HOUSE?

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 & ANSWERSERIKA@VAREALTOR.COM

www.VARealtor.com/AGENCY

PLUS: JUNE 12, 10 A.M. WEBINAR