What the Real Estate NAR Lawsuit & Settlement Means for Sellers and Buyers

[00:00:00] Welcome to Work it, Live it, Own it, a show that explores how to upgrade your lifestyle

[00:00:05] through life lessons, real estate and entrepreneurship. Here's your hostess, SaCola Lehr.

[00:00:11] Hello there, I am Connie Ward with Incredible Realty Group here with SaCola Lehr with Epic

[00:00:21] Realty. And we are here today to talk to you about and dispel some myths around the

[00:00:28] NAR proposed lawsuit settlement and some of the key things to look out for and what it means

[00:00:35] for you as a buyer and or seller navigating the current market in the environment that

[00:00:42] we are in. So thank you for joining us today and we are just kind of jump right in.

[00:00:47] Absolutely, because we're here to allay some of the fears or myths behind what's happening

[00:00:53] and what people are talking about all over social media, the news. We want to give it

[00:00:58] to you straight from a realtor's perspective. Right, so we're going to give you all of the

[00:01:06] tea today. And so SaCola, let's maybe start out with from the seller perspective and

[00:01:14] also kind of maybe touch on how things have been handled in North Carolina for many, many

[00:01:21] years. And so this transition, depending upon what direction and what the final outcome is,

[00:01:28] maybe a little bit smoother for states like North Carolina and the other 17 states that

[00:01:33] have already had agency and compensation transparency in place for many years. As you

[00:01:41] know, I originally got my license in 1997 and we had agency agreements and compensation

[00:01:47] transparency back then and even prior to that. So I think that's important for consumers out there

[00:01:56] to understand that while this is kind of a blanket lawsuit that's covering every part of the

[00:02:02] country, all states have not handled agency or have had the policies, procedures and processes

[00:02:10] in place that some states have. So I think we're special in North Carolina and we're one of

[00:02:17] the lucky ones that this transaction is not going to be as maybe scary or frustrating or

[00:02:24] anxiety filled or written as some other states may be experiencing right now. Right, because I

[00:02:30] think everybody's just listening to the hoopla in the media and are because I've seen it in my

[00:02:36] market. I don't know about you. I'm in the triad market. I kind of border that with

[00:02:41] Mebben, North Carolina to Greensboro, North Carolina. You're in the Charlotte Metro and

[00:02:45] the surrounding areas in North Carolina. What I have seen the rise and increase is for

[00:02:50] sell by owners also known as Fizbo's in my market. And what I want to say to that is

[00:02:59] a lot of the for sell by owners that I have spoken to even some of my friends who said,

[00:03:03] you know what? I don't want to pay all those fees. And look, that's legitimate.

[00:03:08] First of all, let me just say this. Everything in real estate is pretty much negotiable. Now

[00:03:14] your attorney's fees, they're not negotiable. You paying your pro rated HOA taxes. When it's

[00:03:20] time to settle and close those are not negotiable. You're going to have to pay those

[00:03:23] regardless excise tax. If you're a seller, you're going to have to pay for those. There

[00:03:27] is no wiggle room around that. However, when it comes to your commissions of paying out

[00:03:34] to brokerages, whether it's the listing agents firm or the buyers agents firm, there is some

[00:03:42] negotiations on that part. And so we just want to let you know for me personally, I can't speak

[00:03:48] for every other realtor, but for me, I always tell my clients to three days. I disclose,

[00:03:54] I discuss, but you decide the three days disclose, discuss, decide. That's for sellers

[00:04:02] and buyers. One thing I will say about working with a realtor is two, if you're putting your

[00:04:08] home on the market yourself, you may not be aware of all the disclosures that you need to fill out

[00:04:12] and complete with accuracy to the best of your knowledge. If your home is a certain age,

[00:04:18] there's another disclosure for that. Another thing is that when you are putting your home

[00:04:23] out there on the market and you start receiving offers, you may not already have and it

[00:04:28] because it's not open to the public what an offer looks like because our forms change every single year.

[00:04:35] I know since I've been in real estate every single year, disclosures, we have a new disclosure coming

[00:04:41] out in July one that has changed and updated and it has been revised. So if you're putting your

[00:04:46] home out there on the market, you're going to have to go back and do some more work or

[00:04:50] the buyers agent is going to say, do you have the updated disclosures? We're missing this

[00:04:54] disclosure or you're looking at an offer and you may not know what those terms mean. So working with

[00:05:01] a realtor who is going to be standing in your corner to help you negotiate, to help you go through

[00:05:07] and disclose the types of offers that you are receiving on the table and presenting what could

[00:05:15] possibly be the best fit for you. Ultimately again, you decide, you make those decisions,

[00:05:22] but again, I've had a friend. I told him upfront what disclosures he needed to have.

[00:05:29] Even after he was done with the process, I asked him, I said, are you ready to be a realtor now?

[00:05:33] And he said, oh God no. I don't want to do what you do. And so they have no idea and I know

[00:05:41] reality shows make it seem so glossy, easy, breezy, but we got the boots on the ground. We're here

[00:05:48] to work and represent you. And another thing Connie, I want to say is if you are not selling your home

[00:05:56] for yourself and you are working with a listing agent, particularly in North Carolina, this is

[00:06:03] something that I do and Connie, I'm pretty sure you do this as well is provide in the listing

[00:06:10] conversation that I have what sellers is to show them and disclose to them what they could

[00:06:17] potentially net in the transaction. So this is just a sample of what we call the seller

[00:06:25] estimated net sheet. A realtor has gone through, done some research. You provide what the mortgage

[00:06:33] payoff is if you have a first mortgage, second mortgage, home equity line of credit, HOA fees,

[00:06:39] all of that. What potential attorneys fees you will have to pay from the seller's point

[00:06:44] of view, your pro rated HOA's, your taxes, recording the deed or transferring the deed.

[00:06:51] You have to pay a fee for that. Your excise tax, you're going to have to pay for those things

[00:06:57] as a seller. Then as you scroll down, if you decide if your home hasn't been in great

[00:07:03] condition or there's been some deferred maintenance, maybe potentially doing a pest

[00:07:08] inspection or home inspection, so you already know the condition of your home when you're selling it.

[00:07:15] But in this estimate here at the bottom, this is just an estimate. This is a possibility

[00:07:23] of what you could walk away with in this estimate sheet. Connie, can you scroll up for me just

[00:07:29] a little bit? It will show you the commission that a realtor could receive. And I always tell

[00:07:38] my clients this, guys, I don't get all that money. It's split 50-50 typically in most cases 50-50

[00:07:49] in half. One is going to go to the listing brokerage and the other one is going to go

[00:07:55] to the buyer's brokerage for the buyer bringing a willing ready enabled buyer. Okay? Then if you

[00:08:03] really want to break that down, which I normally do, and guys even half of that, I may not get. Now,

[00:08:09] Connie, you're different because you have your own firm. So you facilitate how that money is

[00:08:15] divvied out with your paying someone to help you on the back end, but say someone like me who's

[00:08:20] working with a brokerage. Guess what? Even 50% of that, a fee or percentage of that is going to

[00:08:27] the brokerage first. Then I get the rest of that. So and that is one, that is to protect you because

[00:08:38] you have a firm who is knowledgeable. You have an agent who's knowledgeable, a realtor who's

[00:08:42] knowledgeable to represent you, to negotiate for you, to be accountable for funds, making sure

[00:08:48] that funds, monies are getting where they need to be, making sure that we're reaching the

[00:08:54] deadline in a timely manner to negotiate on your behalf in a legal and ethical manner. So always

[00:09:03] when you're having a listing discussion, if you're thinking about putting your home on the market,

[00:09:08] if you don't see some seller estimate sheet, ask for one. You have the right. Ask for one.

[00:09:14] Transparency, honesty, that's what I go by. That's how I work. That's where I thrive.

[00:09:20] And that's how I get a lot of my seller clients because if they ask me a question,

[00:09:25] I'm going to be honest with them and I'll tell them, I don't know everything in this business.

[00:09:29] Every transaction, every situation is different, but if I don't know, I know how to ask.

[00:09:34] People like Connie, I'll ask her. She's been in real estate since the 90s, since the late 90s.

[00:09:39] I will ask. I will call the commission. I will ask. So don't always go by the shiny

[00:09:46] object syndrome when it comes to a realtor who's going to do that. Look for the boots on the ground.

[00:09:52] What are you bringing to the table? What can I possibly walk away with?

[00:09:56] Okay, because they've already done their research and saying, okay, based on comps, this is what

[00:10:01] three scenarios, possible scenarios of what you could list your home for. And this is what

[00:10:05] you could potentially walk away with. So we're not your enemy. Okay. Not all realtas

[00:10:13] are your enemy, but I will say, please just be open enough to still have those conversations and find

[00:10:18] out which realtor would be the best fit for you. And if at the end of the day, you're still not

[00:10:24] satisfied and you still want to try this and go out on your own, then go ahead, but make sure

[00:10:30] you have all the disclosures. And I know for the sample offer to purchase, you can't get that

[00:10:35] on the web. You have to get that from a realtor. So make sure you're doing everything above

[00:10:42] board either way. And if you have someone like me, I'm going to already tell you what your

[00:10:49] essential documentation needs to be. This is what kind of you've seen this before. This is my magazine.

[00:10:54] This is what I give to sellers. I always tell them what they need to have before they even

[00:11:00] put their home on the market. And so those are some things that sellers don't think about

[00:11:04] as well. But then again, that's why you need to have a trusted advisor by your side,

[00:11:09] representing you all the way to the finish line and beyond that.

[00:11:15] Absolutely. I mean, I echo all of those sentiments, facts, and relevant pertinent information.

[00:11:24] And I just would want to add to this. I think that the internet obviously has changed our lives,

[00:11:31] right? So consumers have access to so much information now and almost too much information

[00:11:38] because everyone feels like they're a guru or they can attend YouTube University and become a guru.

[00:11:46] And I've done many things. I've learned many skills via YouTube, right? Especially when I'm

[00:11:52] looking to save money because I'm a frugal person. I understand that. But there are certain things

[00:11:57] that I do not touch. I do not touch electricity and I do not touch water. But I may do a DIY,

[00:12:03] may install some flooring or paint a wall. But there are certain things where the skill set

[00:12:09] required the licensing and also the person that is practicing a particular thing on a daily basis

[00:12:18] is always going to have wisdom, knowledge, insight and discernment that you will never have.

[00:12:26] So that is something you cannot get from the internet. And I feel like there's so much

[00:12:31] coming at us, right? From a media perspective like you talked about, there's things in the news.

[00:12:36] And we've seen a lot of things that are actually being reported incorrectly. And we are not out here

[00:12:44] saying that none of this is true. We didn't do any of that because there were some bad apples,

[00:12:50] right? Just like every other industry. But I personally don't believe that this is just

[00:12:55] this blanket thing that every single real estate professional has done. I think we've seen

[00:12:59] this in other industries. And there's other factors that have influenced just a mindset of people

[00:13:06] with reality TV and shows and the internet that makes it appear that our jobs are really easy

[00:13:12] and simple. And we only post pictures of houses online, and we unlock doors and we fill out a

[00:13:18] couple of forms. And I'm here to tell you, even though I practice real estate and I had a gap

[00:13:25] in between and have done other things in back to real estate, the totality of it is about 25-ish

[00:13:32] years that I've been in this space in some capacity, is that I've sold or participated in the sale of

[00:13:39] hundreds of transactions, right? And all of them have some nuance, something that's unique

[00:13:49] about it because it involves humans. And anything that has the human element, the factor you're going

[00:13:56] to have whether it's personalities, whether it's circumstances, whether it's something with the

[00:14:01] property or the people, there's going to be something that's unique about that situation.

[00:14:06] And because we do this on a daily basis because we practice real estate, just like by no means

[00:14:11] am I comparing us to doctors, but doctors practice medicine, attorneys practice law,

[00:14:18] we are practicing and we're using case studies, we're using our experience that we've had in other

[00:14:27] transactions. And this is just something that the average person is not going to have. And when

[00:14:32] something arises that is out of the norm that you didn't see on TikTok, then you're going to

[00:14:37] potentially be in trouble. And so I think that we have to keep these things in mind because

[00:14:43] I firmly believe that the actual crux, the meat of the transaction begins after going under contract.

[00:14:51] I think most of us would agree that many real estate agents, we can market homes, we can post

[00:14:56] pictures, we can do all the things to get a home market ready to make it as marketable and

[00:15:02] appealing to the most people that are fit that criteria for that home as possible. But

[00:15:09] it takes a certain level of skill to get that property from contract to the closing table.

[00:15:16] All the things that happen in between that space can be very complex, they can be

[00:15:25] stressful. And there can be a lot of unknowns, things that pop up just one simple random

[00:15:31] example. The last transaction I had had an unrecorded shared driveway situation

[00:15:38] that could have completely derailed the entire transaction. Literally hours upon hours, days upon

[00:15:45] days of calling, studying, trying to find the owner of the property next door because there could

[00:15:52] have been a potential easement situation or it could have been an encroachment situation.

[00:15:59] So these are the type of things that come up that the average person is not going to be able

[00:16:04] to handle. And attorneys are involved in real estate transactions, but there are certain things that they

[00:16:11] don't do. So I've seen on the internet where people say, oh, all we need to do is get an attorney.

[00:16:16] The attorney, yeah, for sure, can help you with the actual contract, the legalities of

[00:16:20] that maybe keeping you out of hot water. But an attorney is not going to do all of the things

[00:16:26] that a real estate agent does for a flat low minimum fee that people might think that they can

[00:16:32] get an attorney to do. It's going to be, they don't have enough manpower or hours to even facilitate a

[00:16:39] whole entire real estate transaction. So I feel like people are disillusioned if they think, oh,

[00:16:45] an attorney is going to do all of these things because it's just not possible. And I don't

[00:16:50] think that they would get it at the price that they think that they will get it. So that's

[00:16:54] one thing. The other thing is, you know, we're helping you navigate and facilitate this

[00:16:58] process, right? We're kind of like the conductors, the orchestrators and we're helping you navigate

[00:17:03] all the is and flow and the twists and turns that happen throughout this transaction.

[00:17:08] And we do have that duty to discover and disclose material facts and what are material facts? How

[00:17:14] are you supposed to know what a material fact is because you want to protect yourself,

[00:17:19] right? You want to be protected. And the only way to do that is in my opinion is to partner

[00:17:24] with a professional that has had enough experience and that insight to help you navigate the unknown.

[00:17:31] And then when things do pop up, guess what we have? We have the real estate commission.

[00:17:35] We have our governing bodies. We have other industry professionals. We have other brokers,

[00:17:41] other real estate agents that we can tap into and we have on speed dial that the average

[00:17:46] consumer is not going to have. So commissions have always been negotiable. They are negotiable

[00:17:53] every single listing I've ever had. We negotiate that commission. There is no flat fee. So I think

[00:17:59] for us, that's not something that's going to change. But I think it's very important that now

[00:18:05] the things that we try to shield the general public from because that's what our job was.

[00:18:11] We took on all the stress and the burden of smoothing out all the kinks and we keep you

[00:18:17] in the loop. And obviously we're going to be transparent and provide the critical information,

[00:18:22] but there are so many things that are resolved within a day or a couple of hours or a few minutes

[00:18:29] because we've made five phone calls. We're not showing you all of these things or even telling

[00:18:33] you all these things because we fixed it. So those things that could have been a problem

[00:18:39] have been resolved. But all you see is the beginning and the end. Oh, hey, here's this

[00:18:44] pretty house. Oh, hey, it's under contract. Oh, close to Ching. Now I got all this money.

[00:18:50] We don't show you all of the things that happen within that window. We didn't talk about the

[00:18:56] repair negotiating process. What happens? What happens if the house does not appraise?

[00:19:01] Protecting our clients from losing money such as buyers losing their due diligence

[00:19:06] money and all the things that we proactively do to help protect you. There's countless

[00:19:12] numerous things that happen in a transaction that I think people don't have an awareness of because

[00:19:18] we're good at what we do. And when you're working with a experienced good agent,

[00:19:25] then it might seem like it was easy, but trust me, they lost sleep. They might have shed a few

[00:19:31] tears during that process that you never knew about. And I could go on and on and on to the

[00:19:37] break of dawn on this particular topic. But I think there's just so much that has been unknown

[00:19:45] and there just hasn't been any visibility into it. And now it's like we're going to be telling them

[00:19:50] all the things. And I think in a couple of months, actually, I think the general public

[00:19:55] is going to be telling us, okay, enough, we tried hearing about all the 10,000 things that you do

[00:20:02] in a transaction because we haven't really been talking about that.

[00:20:05] And I've seen it on social media about all the lists of things that

[00:20:10] realtors do and bring to the table. But ultimately, it's what we do to protect you

[00:20:15] as a seller. And now we're going to shift over and talk about the things that

[00:20:20] realtors do to protect buyers. And you know this is my jam.

[00:20:26] I just love my buyers. I just love them especially first time home buyers. And even

[00:20:33] those who have been a home while right because you sell a home, that

[00:20:39] side of the transaction looks totally different when it's time to buy. So Connie, what is the best way

[00:20:49] that as a realtor you have found to represent buyers is I don't know about you,

[00:20:56] but is to make sure that they are prepared. I firmly believe on both sides that it's important

[00:21:03] to have a stress less transaction. I can't guarantee you that all the stress is going to be taken off

[00:21:10] your shoulders. And I usually tell buyers when they're anxious, I'm like, wait, wait,

[00:21:13] just take all of that, put it on me. I'll take care of it. I'll handle it. And if there's

[00:21:19] something that I've hit a bump in the road, usually I tell my clients, I'm going to keep

[00:21:24] you in the loop. But I'm going to tell you what, here was the situation, but I'm going to tell you

[00:21:28] what I did to kind of help allay that and remedy that. And here are our next steps. And again,

[00:21:35] this is the part disclose, discuss, and then they decide how the buyer wants to proceed and move.

[00:21:45] And sometimes I love the 3Ds right? Disclose, discuss, and decide. And

[00:21:51] when I'm having my consultations, especially, well buyers and sellers, I say this a lot. I have

[00:21:57] a lot of catchphrases that you know I make up. But I tell them, you're the boss, right? You make

[00:22:03] all of the decisions. It is not up to me to force you to convince you or to tell you what to do.

[00:22:10] My role is to provide you with the information that you need, educate and empower you to

[00:22:16] make the most informed decisions possible pertaining to your role in this transaction as a buyer or a

[00:22:22] seller. That's my role. And you're the principal in those agreements, they're the principal. So who

[00:22:29] is the principal? Principal is the person that's in charge. The principal is the one that's calling

[00:22:33] the shots and making all of the decisions and also negotiating our fees with us. You have

[00:22:42] pretty much all of the power because we have a fiduciary responsibility and duty to you. And you

[00:22:48] are again, the principal, the boss, the chief, the head person in charge. As long as you don't

[00:22:53] ask me to do anything illegal, immoral or unethical, I will follow your direction and your

[00:23:00] decisions or your decisions. My job is to give you all of the information that you need to

[00:23:06] help you make those decisions. So I think that's really key in all of this is that

[00:23:15] we're not calling the shots and making the decisions.

[00:23:19] On either side? You're deciding. Yes, always. Always. Always. Make the final decision.

[00:23:26] Even if I may think something is great and that may be the best option, I will say what do

[00:23:33] you think? What are your thoughts on this? And then we're like, and then sometimes I come

[00:23:37] in, well, what do you think? Well, based on the research, based on this, I think you have some

[00:23:43] good options here. Based on the data, right? Yeah. I present data on both sides, but you

[00:23:48] mentioned something very key. I do buyer consultations as well. And a lot of times,

[00:23:53] and this is not a knock against other people how they run their business, but that's how

[00:23:57] I like to run my business because one, I want to make sure that we are a good fit. I am

[00:24:00] running a business. I want to make sure that we are a good fit.

[00:24:06] Am I a good fit to be your trusted advisor? Are you a good fit to be my client? Because one thing,

[00:24:12] like you said, we are the expertise in our area. And if I have a client who was like,

[00:24:18] well, no, I want to do this, I want to do that. Well then, okay, that's great.

[00:24:24] But then I may pick that up in a consultation. As a buyer, you may pick up, this may not

[00:24:29] be the right realtor for me. So a lot of times when you're searching online and you come across a

[00:24:34] realtor and you say, hey, I want to see this home, first and foremost, what I would advise

[00:24:39] anyone to do when you are thinking about buying a home from the moment you're thinking,

[00:24:45] dreaming, planning about buying a home is one, get your finances straight. Start saving some

[00:24:50] money. That's a whole other. This whole another conversation. We've done a video on that

[00:24:56] already. I think we talked about the 10 things you should not do when you're applying for a mortgage

[00:25:00] loan, but plan and prepare. And during those times whether you're hopping in your car to meet up with

[00:25:09] a realtor to see a home for the very first time too, I want to make sure that please be pre-approved.

[00:25:15] Can I just pause you for just a moment? Because you touched on a lot of things. And you know,

[00:25:20] when we're talking about buyers, Nicole and I have been accountability partners for what,

[00:25:23] three years now? We meet every single one. Going on floor. We've had a lot of conversations.

[00:25:28] Yes. And you know, some of these things are hot buttons and not hot in the sense of like being

[00:25:34] upset, but because I'm very passionate about these things. And we do not hop into cars to show

[00:25:40] homes. I think as real estate professionals there's several things that should be happening

[00:25:47] before we ever get to that point. But I do want to point out that I think with the internet

[00:25:52] and with some of the misconceptions and lack of understanding about our roles, and also on our

[00:25:58] part us trying not to be pushy, overwhelming salespeople that there were maybe some of us

[00:26:06] that did things out of order because we didn't want to turn you off. We didn't want to scare

[00:26:11] you. We didn't want to start talking about documents and making it seem like you have

[00:26:17] are committed to us, you know, upon first sight. Right? And I think we kind of in some ways,

[00:26:25] the collective allowed you to be in the driver's seat when you technically should be a passenger.

[00:26:32] And I think that has caused some of the issues that we have. And so I want to point out the

[00:26:39] fact that like you said, I know I'm not everybody's jam. And that's totally fine. It

[00:26:44] does not hurt my feelings. Right? I'm not everybody's jam. And that's cool. And that's why it's so

[00:26:50] important to have that initial conversation that may or may not lead to a consultation,

[00:26:57] which may lead to then you becoming a client and not a customer. Because until we actually

[00:27:05] are in a relationship and we go together, you are a customer. You are not my client. And there

[00:27:10] are certain things that I do not owe you as a consumer, right? To be honest and to treat you

[00:27:17] fairly. But I don't owe you that fiduciary responsibility or even privacy, right? In

[00:27:24] certain aspects if we are not partnered up in that agency relationship. And I think that's one

[00:27:30] of the ways where in North Carolina we're special and unique because we have always had

[00:27:35] as far back as I can remember agency and agency agreements and also the compensation and how we

[00:27:41] get paid, how much our fee is and who we're expecting to pay us is all written out in that

[00:27:47] document. Right? And so we go from the initial conversation to a consultation. And ideally,

[00:27:56] we're going to meet face-to-face like this on Zoom or in person so that we can get a sense

[00:28:01] for each other. And we could get to know one another before we start asking you your deep dark

[00:28:06] secrets, right? So that's the purpose of that consultation. And then we want to talk to you

[00:28:10] about some of the legalities of engaging a real estate agent versus you calling us or from some

[00:28:16] of the well-known websites and expecting us to jump in the car and meet one, a stranger,

[00:28:23] that we don't know that is ready willing and able qualified, that you have the resources,

[00:28:30] the cash or otherwise to purchase a property, right? And for a safety perspective, it's not safe

[00:28:37] to jump in your vehicle and meet complete strangers at a home that may be in an area that's

[00:28:42] not populated. And I think for people to expect us to essentially risk our lives

[00:28:50] because we don't want to have this conversation that can be awkward early in the process.

[00:28:55] So I've always conducted myself that way as you have, having those initial consultations and

[00:29:01] conversations and deciding are we a good fit? Do we actually want to form a partnership before I

[00:29:06] jump in my vehicle and use my time talent resources and risk my life because that is a fact

[00:29:14] that this is a dangerous space for us to operate in. And we should not be expected

[00:29:21] to risk our lives to show a home, to a stranger, to a person we do not know, right? And we want to

[00:29:27] be bringing buyers into homes who are potential candidates to purchase, not just looking for the

[00:29:33] sake of looking. These are people's private personal homes that they may even still live in.

[00:29:39] So all of those things are things that I think the general public does not think about

[00:29:43] and to taking consideration that, oh, I just feel like going to look at houses that may or

[00:29:47] may not be in my price point and that's okay. So it's not okay in a lot of categories and for a

[00:29:54] lot of reasons. And in North Carolina, we have what's called working with real estate agents

[00:29:59] disclosure. This is something that's supposed to happen and is required, right? Upon substantial

[00:30:05] contact. What does that mean? Let's talk about that. We need to substantial contact really

[00:30:09] quickly. Yes, because really quick. A lot of buyers will start off by saying, well,

[00:30:14] I'm looking for a three bedroom, two bath home. I'm looking for this amount of square feet.

[00:30:19] I make this amount of money. First of all, my credit is this and this and that.

[00:30:22] Stop. Stop. Stop. Do not. Look, this is a hot topic. I'm not getting upset, but I want to drive

[00:30:29] this home. I got a fam, I swear. I want to drive this point home to you all. The moment

[00:30:34] you start talking about your financial abilities, what you're looking for in your dream home,

[00:30:40] that is when a realtor, and I know it may seem awkward, but that's when a realtor will have to go,

[00:30:46] okay, let me explain to you how agency works in North Carolina. Because when Connie said

[00:30:50] that we do not have any loyalty to you, she's showing the brochure. I'm probably going to put

[00:30:56] this as a bonus on my podcast as well, but it's called the working with real estate agents

[00:31:00] brochure. That's what we have in North Carolina. We have it for buyers and we have it for sellers

[00:31:06] because we want to explain to you how agency works in North Carolina. First and foremost,

[00:31:11] when Connie said we don't have a loyalty to you, if you show up again in an open house that I may be

[00:31:18] showing, okay, for my firm. Listen to me now, for my firm and you've already told me information

[00:31:28] and you have already working with another realtor and not with me. You did not sign a

[00:31:33] buyers agency agreement with me. Don't you know I could go back and tell the listing

[00:31:38] agent all of your business because you have put yourself, you have exposed yourself, you put yourself

[00:31:45] out there and you have given personal financial information to someone who does not have a legal,

[00:31:53] ethical, fiduciary duty to you as a client. When I say, when we say agreements,

[00:31:59] buyers agency agreement, something we've had in North Carolina for a very long time,

[00:32:03] it protects you as a client. It protects me as your trusted advisor because my firm

[00:32:10] or Connie's firm is representing you, so please make sure and I should be receiving this.

[00:32:17] There's also a one page document that is working with real estate agents disclosure that you sign.

[00:32:23] If you are not receiving, not necessarily this brochure because this brochure is something that

[00:32:29] you could have a link to and download yourself. We could provide it to you in PDF format or I like

[00:32:33] to give people the actual physical that they can see, touch and feel and this has so many Q&A

[00:32:40] questions and answers and information in it but we do give that disclosure upfront that you sign

[00:32:46] as an acknowledgement of receipt and that we discussed and disclose this to you. It does

[00:32:52] not obligate you to work with us but before we jump in a car and show you a home you

[00:32:57] should have received a working with real estate agents disclosure every single time,

[00:33:02] every single agent and a lot of times that's not something that's happening which is part of the

[00:33:09] hot water that some of us may have gotten into but it's very important to know this information

[00:33:15] and understand and not perceive that as us trying to force ourselves on you to sell you

[00:33:21] something. It is for your protection. These are consumer protection procedures and guidelines

[00:33:29] to keep you safe and to make sure that your best interests are always at the forefront.

[00:33:37] As we were talking about once we have that initial conversation and we're moving into a

[00:33:41] consultation and we're discussing agency with you and then we're deciding and maybe we're not

[00:33:46] deciding that day and maybe we're potentially going to a agency agreement for that one property.

[00:33:52] So you don't have to go into an agency agreement with me forever and ever and ever right? It could

[00:33:57] be for that specific property until we've gotten more comfortable and we've decided that we want

[00:34:01] to move forward. Different agents handle it different ways but after the first or second

[00:34:07] conversation I feel like if you cannot decide if I'm your jam then I'm probably not and you

[00:34:12] probably need to move on and find someone else that closely aligns with whatever it is that you're

[00:34:16] looking for whether it's from a personality perspective style or whatever it may be and

[00:34:22] that's totally fine but just understand that a lot of these things are in place to protect you

[00:34:28] and to keep you empowered and informed and not to harm you. And I think that's the area that

[00:34:34] kind of got a little murky because we didn't want to scare you away by doing this

[00:34:39] upon that first substantial context like can you show me a house? Bam! Sign this. Look at this.

[00:34:44] Read this and you're like we just met but we need to slow down this process because this is a huge

[00:34:52] decision. This is for most of us the largest financial decision we're going to make in our

[00:34:59] entire lifetime and so it's super important. It's not like play-play just casually so

[00:35:07] it's not necessarily even about just the money or not necessarily even about our time but taking this

[00:35:15] very seriously and handling it the way that it should be handled and I think that's what we're

[00:35:19] able to now move forward in because now this whole can of worms has been opened and I think

[00:35:26] it's a great thing. I think it's a great thing for agents and for consumers because I think

[00:35:30] it is going to shed a lot of light on the unknowns and dispel a lot of the things that

[00:35:35] you've seen on reality TV and social media. One other point I just want to add for buyers as well

[00:35:44] do not be surprised if an agent before they even get in their car and show you home because every

[00:35:50] agent operates a business runs it differently some will hop in the car because you call them

[00:35:55] say hey I want to see this house. Okay do not be surprised if there are some agents

[00:36:00] even me even after I do a buyer's consultation I'll tell them straight up

[00:36:03] I need a copy of your ID. Yep I need a copy of a valid driver's license or some form of ID

[00:36:11] for me to know who you are you are who you say you are that is a protection for us but it's also

[00:36:18] a protection for you because there is a lot of fraud going on right now and some people have

[00:36:24] even gotten savvy we're getting a photo ID but as a realtor we also have ways to do a little

[00:36:31] more digging and finding out okay is this the person who they say they really truly are.

[00:36:37] That is a protection and I tell my clients that all the time even if you are selling your home

[00:36:42] I'm going to ask for your ID because it may not be your home. I had a relative reach out to me

[00:36:47] about a rental property they were interested in she forwarded me the email I did some digging

[00:36:54] I found out that that is not the owner's name. Yep it happens all the time right and I said well

[00:37:03] let me see do you have a copy of the lease agreement it was something that somebody had

[00:37:08] downloaded off online and I typed a response for her and I said send this back to them

[00:37:16] and see what the response is. It was complete fraud they were trying to rent out someone's home

[00:37:22] so that part where you are a national deposit and collect the deposit and you'll never hear from them

[00:37:27] ever again and you think you're going to get ready to move into this place and people and the owners

[00:37:33] are looking at you like you're crazy so don't be surprised we are going to ask for ID we're

[00:37:39] going to still do a little bit more digging and make sure you are who you say you are that

[00:37:42] is a protection for us but it's also a protection for you. So Kola you know what I know we probably

[00:37:48] weren't planning to talk about this or even to go into this level of detail but I think this is just

[00:37:53] so important. There are a couple of things and I don't want to forget because it just popped into my

[00:37:59] mind about our compensation right that it's negotiable on the buyer side and the seller side

[00:38:05] and also real estate agents especially on the seller side we are typically the one taking all

[00:38:14] the risk right because we have upfront expenses right we may spend you know upwards of a few thousand

[00:38:22] dollars to market a home right and we are not compensated until we get the closing table

[00:38:31] the very end and the documents are signed and ID is transferred so we're being expected to do all

[00:38:37] of these things essentially for zero compensation upfront right and then provide all of these services

[00:38:46] and we potentially in the end are out of some money out of pocket funds and our time talent

[00:38:53] and resources right so we're putting forth a lot of risk to serve the clients that we are trying

[00:38:59] to help so I think quite often people look at us like oh they make a lot of money they're

[00:39:04] money grabbing we do have a lot of expenses people don't realize we're full-fledged business owners

[00:39:08] right we are entrepreneurs we're business owners there's no check on Friday right there's nobody

[00:39:13] that's it's paying us for our services until we've completely formed performed a lot of services

[00:39:20] for our clients so that's one thing that I think people don't understand or don't know about or

[00:39:25] maybe they overlook it and so we're taking on this risk right to help you market your home

[00:39:31] ultimately with the goal of getting it sold and closed so we have a vested interest in getting

[00:39:36] you to the finish line as well and we can often be the glue that holds a transaction together

[00:39:42] because guess what's inside of a transaction personalities and sometimes they clash and sometimes

[00:39:48] buyers and sellers will be literally out in the front yard duking it out if there were not

[00:39:53] real estate agents in place to help facilitate and help people kind of stay in their respective

[00:40:00] corners so that's something that we're also very good at and we're skilled at and that we help with

[00:40:06] because I will tell you with a buyer and a seller potentially trying to go at this on their own

[00:40:10] not to say that you can't okay because it happens um but on a large scale a lot of transactions

[00:40:17] wouldn't make it to the closing table because of just personality egos and things like that

[00:40:21] will interfere with this process so we're kind of like the referees right um so that's from

[00:40:26] the seller perspective on the buyer side it's always been a thing or for as long as I can remember

[00:40:32] and I know I've said that many times but um real estate agents could have charge retainer fees

[00:40:39] right inside of their agency agreements since the beginning of time okay so let's talk about

[00:40:43] that because in the North Carolina buyers agency agreement there is a line on the first page

[00:40:49] that talks about a fee and I do know that there are realtors in other states there are

[00:40:55] realtors here in North Carolina or teams that will charge a transaction fee or what they may call

[00:41:02] an administration fee and that is legally ethically correct because it's in the documents

[00:41:11] and a realtor can do that but I want you to think about this from the buyer's perspective

[00:41:16] we're getting in a car gas mileage time to show you homes then submitting

[00:41:27] offers on your back research researching the properties doing the comps then helping you

[00:41:35] advising you on the type of author offer that may be or even calling up the listing agent finding

[00:41:43] trying to get some insight on what it is that can make your offer stand out all of that we're not

[00:41:52] getting paid for until you decide okay this is the house and then the offer gets accepted and then

[00:42:00] a buyer's agent will typically get reimbursed once the closing has taken place and the deed

[00:42:06] has been recorded just know with this lawsuit you may encounter more buyers agents who may have

[00:42:14] in their buyer's agency a transaction fee and because up front potentially non-refundable retainer

[00:42:22] non-refundable and the reason why yeah I wanted to talk about the retainer fee is because one

[00:42:28] across the board this has been something that agents have not wanted to do for years okay guys

[00:42:35] I've been licensed for over 25 years okay from the day I got my license in 1997 that retainer

[00:42:42] fee line item has been on the buyer agency agreement and in most instances and I can confidently say this

[00:42:49] it's zero okay that and because that's another area where we were trying to protect you to be

[00:42:56] friendly and to be nice and to try to not scare you away now this whole can of worms has opened

[00:43:02] and we're like you know what wait a minute we've been providing you with all of these services and

[00:43:07] all the things for zero dollars but yet we're spending money to help you get to being under

[00:43:15] contract to buying the home that fits your family's needs your needs your your dreams whatever it is

[00:43:22] your um generational wealth and all of the things that owning real estate can provide

[00:43:27] and we're doing that with no skin in the game from our clients because we're basically putting

[00:43:34] forth the risk and we're also using our time talent resources right our money to help you

[00:43:41] and so I think what's going to happen too is real estate agents are going to start charging

[00:43:46] those returning fee retainer fees it's going to become the norm um I personally um am figuring

[00:43:52] out the adjustments that I'm going to make from my brokerage and that return retainer fee can be

[00:43:58] credited to you at closing if you make it to closing then it will be credited to you so it's

[00:44:03] not money that you lose like a sock in the dryer um but it may be non-refundable if you don't

[00:44:09] close and I think that is fair and I think that it's reasonable and I think that you should

[00:44:14] start to prepare yourselves and expect to see this it's not new it's not unusual some agents

[00:44:20] have practiced this for many many years but most didn't because again we were trying not to scare you

[00:44:26] away and we wanted to earn your trust and we want you to like us and all of that but I think now

[00:44:31] that this is at the forefront is putting us in the position to where now these are the things

[00:44:35] that we can openly talk about without fear that now you think that we're scammy and we're just

[00:44:40] trying to get money from you right um so I think that this this is one of the many reasons

[00:44:45] why I'm kind of excited about I don't um of course I don't like the space that we are in

[00:44:52] in the real estate industry but I think some of these things are going to be good for consumers

[00:44:56] and for real estate professionals as well and there will be some things that we don't like on

[00:45:02] both sides but we're going to get through that and we're going to navigate it and we're going to

[00:45:05] have a new norm that is going to be okay um so that's the retainer fee and then of

[00:45:10] course talking about the buyer agent compensation how we're compensated who compensates us whether

[00:45:18] it's the buyer or the seller or a combination thereof so those are some things that you can

[00:45:22] expect to start seeing now um and to start also um adjusting your mindset about right so I think

[00:45:31] that is something that like said it opened up a lot of worms but it also makes realtors re-evaluate

[00:45:39] the business practices right all around exactly yep and it's going to our conversations are going to be

[00:45:47] different are going to sound different when it comes to speaking with sellers and buyers so

[00:45:54] to close this out because we talked about a lot of information yeah a lot yeah and but

[00:46:00] it was because we're passionate about helping people I want to be coming from a place of service

[00:46:06] I never operate out of scarcity and lack I'm not going to helm people down that's not what I do

[00:46:11] right I don't like to be hounded so I'm not going to hound you but if you are thinking about buying

[00:46:18] or selling your home and you would like more information please don't hesitate to email me

[00:46:25] at info at workitliveitownit.com

[00:46:30] and I have two magazines here one is for the buyers your home buy guide and then the other one is sold

[00:46:37] all the things that you need to know before putting your home on the market and I know sometimes

[00:46:43] when relocation are you trying to run and have from the federal government just joking about that

[00:46:49] but hey you got to sell it real quick for whatever reason personal reasons there are some things

[00:46:55] there are some things that can help you to get your home ready so it can sell in a timely manner

[00:47:01] and Connie how can they reach out to you you can find me in all the places at either cake

[00:47:07] and real estate or connywardrealtor.com is my website you can find me on social my phone numbers

[00:47:16] there my email address you can email me you can hit me up in the DMs however you need to

[00:47:21] get in touch with me even just to have that initial conversation now I do have those for you know

[00:47:27] obviously no charge conversations right my DMs my phone text messages are always open for consumers

[00:47:40] that have questions concerned or just need a little bit of guidance whether you become my client

[00:47:45] or not so that's connywardrealtor.com and likewise anytime you guys need to reach out all my handles

[00:47:53] are work it live it own it instagram facebook don't hesitate there's no question too large

[00:48:01] too small if I don't know the answer I will try and find it out for you but it would probably

[00:48:06] be best like Connie said is to have a sit down conversation or consultation to see where

[00:48:12] you are to see where you need to go if you need to plan out a little bit longer for on the buying

[00:48:16] side that's okay and anything to keep it moving for you if you need to sell your home in a timely manner

[00:48:23] whether it's because of estate reasons or relationships change or family situation dynamics change

[00:48:31] we're here to be of service and to help you in the state I have one last time is in South

[00:48:36] South Carolina now right oh yeah your license and welcome to South Carolina and I have a shameless

[00:48:41] plug too that I wanted to mention all the ways that you can contact me and you can find this on my

[00:48:46] socials and on my website but I offer a free virtual homebuyer class every single month on the third

[00:48:53] Thursday at 7 p.m via zoom sometimes I will have additional classes but you can rely on that every

[00:49:01] third Thursday at 7 p.m class at homebuyerclassnc.com you do not have to be my client to attend this

[00:49:12] class I have other real estate agents clients attend my homebuyer classes all the time just for

[00:49:18] general information because it may be the timing may be right before they can have that

[00:49:26] consultation or conversation with them and it just gives you a general overview so don't feel like

[00:49:31] you have to be my client to attend just let me know who your agent is because I have a lot of

[00:49:36] relationship with agents all over the country and I probably know who they are but again that's

[00:49:41] homebuyerclassnc.com and actually I have a class tonight at 7 p.m so hopefully I will see some

[00:49:50] of you guys there and we just look forward to continuing this conversation.

[00:49:56] Exactly all right guys thank you so much for tuning in and staying with us on this while we didn't

[00:50:03] mean for this conversation to take this long however we wanted to share some insightful things

[00:50:09] with you from the realtors perspective realtors that care realtors that want you to achieve

[00:50:16] that home ownership dream and to take your home ownership to the next level whether it's

[00:50:21] upscaling downsizing whatever it may be all right this is the colonel air and connie ward signing

[00:50:28] off everyone take care bye guys