7 Key Takeaways from the NAR Settlement
By Michael Infanti, Esq.
On March 15, the prolonged legal battle surrounding the National Association of Realtors (NAR) reached its climax with a verdict favoring the plaintiffs. As a result, practice changes went into effect on August 17, 2024.
The resolution of this significant case has stirred unease within the real estate community, accompanied by a potential exaggeration of its repercussions by media outlets.
While the precise ramifications remain uncertain, several crucial aspects of the settlement are pertinent for agents to consider at this juncture:
- MLS Participants cannot make any offers of compensation on the MLS.
- The MLS is required to eliminate all broker compensation fields and cannot permit any offers of compensation in any MLS fields (such as relator remarks, etc.).
- All MLS Participants must enter into a written commission agreement (that contains certain disclosures), before the buyer tours any home.
- An MLS Participant may not receive compensation from any source that exceeds the amount agreed to in the written commission agreement (e.g., a buyer agent can’t agree to 2% in the agreement, but then accept 3% if the seller later offers it).
4. An MLS Participant may not receive compensation from any source that exceeds the amount agreed to in the written commission agreement (e.g., a buyer agent can’t agree to 2% in the agreement, but then accept 3% if the seller later offers it).
5. MLS Participants may not filter out or restrict listings based on the existence or level of compensation offered to the buyer broker.
6. Offers of compensation may be included in certain third-party websites (such as Zillow, etc.).
7. The Settlement Agreement does not prevent sellers from offering buyer concessions on the MLS (e.g., for buyer closing costs), provided that such concessions are not limited to or conditioned upon the payment to the cooperating broker.
In my opinion, #7 is important. I presume that we may start seeing many more sellers willing to offer a 3% concession in the MLS to cover the buyer’s ‘closing costs.
For more information:
FAQs: What You Need to Know Buyer Broker Agreements
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