At the NAR convention I attended Oliver Frascona's session on the 6 D's: Discover, Disclose, Damages, Defendants: Daily Decisions. I know, sounds boring. I think he needs to work on a catchier title. I signed up for this class solely to get continuing ed credit and not expecting much. However, this turned out to be one of my favorite sessions I have ever attended at a NAR convention.
If you ever get a chance to hear Mr. Frascona speak, you should go primely for the entertainment value, and secondly for how much you will learn about mitigating risk and legal issues. Yes, he is a lawyer. But yes, he was so funny and I learned SO much!
Example of how he made the boring subject of the fiduciary duty to a seller not to disclose their motivation for selling. Sample conversation on how to answer the "why are they selling question" (which fyi- you SHOULD NOT answer).
Buyer Agent- "So why are your clients selling?" Seller Agent- "They're moving"
BA- "Haha. No really, why are they selling" SA- "Because they want the money more than the house"
BA- "Ok, you aren't going to tell me. But whey do they need to be out of the home?" SA- "One day after closing".
He also discussed at length whether or not you need to disclose:
- A half way house down the street
- A known sex offender living in the neighborhood
- Noisy neighbors
- Ghosts in the home
- Murder or suicide in the home
- If the house previously was a meth lab
In case you are wondering the answer to many of these bullet points- a very general rule of thumb is "They (seller) Decide, You Provide". If you still aren't sure, the next general rule to follow is "If you know it, you must disclose it".
Mr. Fascona also spoke at length on dealing with home inspectors. His general message here was, don't get involved. You are not a home inspector, so don't play one. The less you know, the less risk you are carring from a disclosure standpoint. A couple points here he recommended:
- Meeting the home inspector at the home is fine, but whatever you do, DO NOT walk the house with them.
- Do not be the one to rely any information found to the seller. Arrange for the seller to speak directly with the inspector.
- If you have to be there, buy a box of cookies before you go, so when you meet everyone at the home they are all happy to see you. Then sit your butt down at the kitchen table and eat as many of them as you can while everyone else walks the home.
- If you see something you think the home inspector missed, first remember that home inspection is NOT your job. But if you think it is a big miss, say something like, "are you sure thoroughly checked the roof" and in more severe cases, recommend that the seller get a second opinion (not yours).
Overall, this was a great session and highly reccommend it. You can also receive 3 CE credits for attendance. It really opened my eyes to how much risk Realtors have to get sued, even when simply trying to help and provide service. Spending three hours in this class could save you hours and a lot of money in court.