I was recently reading an article in a local magazine, that was written by a Little League Baseball Coach. He is a bonafide Rule Enforcer. He knows every rule of the game, and exactly how far they can or cannot be bent. He also knows a couple of common mistakes that are made by other coaches when they get 2 similar rules confused. As I read the article, my mind was comparing his nature, and his experiences, to my own nature and experiences, and how these can apply to the real estate industry as well.I admit to being a Rule Enforcer. I have absolutely no problem singling out the Rule Breakers, which is probably obvious from my very rare "rant" posts. (Just be glad they're rare =P) But this post is about how as real estate professionals, we have MANY rules and laws that must be followed. And when representing my clients, I use my knowledge of the legalities, the rules, and the REALTOR® Code of Ethics, in a manner that best benefits my clients. (I imagine most of us work in a similar manner; within the means of our own strengths and personalities.)
Again, I'd be remiss if I didn't admit to my love of Rules! I like knowing exactly where the boundaries are. And I like knowing exactly how far a rule can or cannot be bent. (Blatant Honesty Moment: I DO NOT like gray areas, and I don't think much of people who live in the gray areas!) And I Use My Knowledge for the Benefit of My Clients! Yes, I admit to that too. I go out of my way to take the instructional classes at the Daytona Beach REALTOR® Association (available for REALTORS® only - not just real estate licensees) every time the FAR/BAR contracts are changed. I go out of my way to seek out the changes and differences in the Standard FAR/BAR contract vs the "As Is" FAR/BAR contract!
To clear up any confusion here, we have 2 separate contracts instead of just an AS-IS rider. This was changed several years ago, in order to clear up some common legal problems that were occurring due to mis-use, and mis-information when implementing the "As Is" clauses, formerly referred to as the "D' and "N" clauses. Also, so there's no confusion, in our area, the FAR/BAR contract is the one that is expected to be used when presenting an offer; s
o I'm only addressing the 2 FAR/BAR contracts, rather than the "FAR" contract(s).I enjoy learning the legalities and reasoning for why certain changes have been made to our FAR/BAR contracts, and how we can protect our real estate clients. (Again, the contracts AND the training classes at the REALTOR® Association are only available to actual REALTORS®, not just those who hold a real estate license.)
I'm now going to show my hand a tiny bit here by pointing out the most common mistakes that I've personally seen, where other REALTORS® misstep on the FAR/BAR contract. And no, I do not point these mistakes out to them when they bring me an offer on one of my real estate listings. I just keep it under my hat, and pull it out if the offer becomes a contract, and the other agent starts dropping the ball on their end. My reasoning? From the very beginning of an offer, I'm focused on the big picture... the long haul... the "what if" of what could happen in the Worst Case Scenario. And I want my clients to be ahead of the ball! It's just good business and BEING a real estate professional.
Now for my tiny tips as I show my hand just a bit ;-)
In the Daytona Beach area, the most common places where mistakes are made in our FAR/BAR real estate contracts are...
1. The "money" section, and how what wording is used, and in what places it is used, when a deposit/good faith money is not collected at the time of the initial offer. Do you use verbiage like "Upon Acceptance" for when the good faith money will be provided by your buyers? Hmm. Maybe you should take that class at your local REALTOR® Association.
2. Writing any type of verbiage that reference clauses that are already detailed in the contract. Why would you do this? Isn't all the necessary verbiage already there? Wasn't that legal verbiage used, based on real estate history and past problems? Isn't that verbiage stated in a manner that's meant to prevent the problems we've had in the past? What are the potential problems that can happen when you add to that verbiage?
OK. So I've just posed 2 problem areas, and several questions. In reading this, do you know WHY the examples I've given might pose a problem? I know this post is open for the whole world to see, and I'm only addressing Florida real estate, but we can still learn from each other. So what are your experiences? How do you handle these areas? Or do you encounter other contractual areas that are a greater problem in your location?
So many questions. So many loopholes and potential pitfalls. What's your take on the rules, laws, and REALTOR® Code of Ethics? Have you been an "unintentional rule breaker"? I'm interested in the thoughts of all of you who work in ANY area of real estate, even if you're not a REALTOR®, and even if you're not in the "sales" part of the industry.
And yes, I'll answer some questions as you comment. I wouldn't want to just leave you all scratching your heads and wondering what the heck my point could be. Just consider this an educational blog post for everyone involved in real estate; even the individual buyers and sellers. =)
Looking forward to your comments!
www.PortOrangeRealEstateSales.com
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