Posted on December 24, 2024
Authored by Jonathan Hammer Levy
What’s Next? Bracing for the Other Shoe to Drop: Rising Litigation and Costly Repercussions Ahead
With the recent mandate from NAR® and the DOJ to enforce Buyer-Broker Representative Agreements, the real estate industry finds itself in a turbulent era of unforeseen consequences. Missteps, misunderstandings, inequities, and pervasive non-compliance are cropping up as many industry professionals struggle to understand, manage, or effectively implement these agreements. For some, the agreements are misused, not used in a timely manner, or neglected entirely, creating fertile ground for costly errors and potential backlash.
At the recent NAR® convention, the message of transparency, compliance, and accountability resounded loud and clear. Nykia Wright, NAR®’s CEO, also pledged “Extreme Accountability,” affirming NAR®’s dedication to refining its practices to better protect consumers and assist NAR® members. While her dedication to integrity is laudable, one critical issue remains unaddressed: a cohesive, industry-wide approach to managing and securing Buyer-Broker Representative Agreements for full compliance.
It’s not enough to simply obtain signatures. The real challenge and the true test of our industry's commitment to accountability and transparency—lies in the careful management of these agreements post-signature. Agreements cannot simply be filed away or left unchecked; they need consistent oversight, secure storage, and an established process for handling updates or disputes. Without proactive third-party oversight, we risk descending into a costly cycle of litigation and eroding trust, which may fundamentally alter the real estate industry's landscape.
Looking ahead, I see a tsunami on the horizon. New challenges to our handling of these agreements are almost certain, whether they come from the DOJ, individual buyers, or class-action lawsuits. What will brokerages, MLSs, NAR®, and its members do when agreements go missing and transactions are stalled? How will they respond to claims of altered, expired, or mishandled agreements? And how will they manage the fallout from allegations of malfeasance, postdated agreements, or even outright negligence? These risks aren’t theoretical—they are imminent unless we implement immediate measures to securely store and manage these agreements. Without immediate intervention and a clear narrative necessiating post signature compliance, we are inviting a surge of litigation and far-reaching consequences.
A third-party, disinterested entity acting as a repository for accounting and storing agreements is essential to preserve the integrity of our industry and attain true compliance. An independent repository would protect all parties involved, ensuring that agreements are securely stored, transparently managed, and easily accessible when needed. This structure would help safeguard against potential allegations, reduce liability, and uphold industry standards by establishing accountability in a neutral, secure manner.
ConfirmBuyer.com was created by industry insiders—NAR® members, brokers, attorneys, and agents—as a forward-thinking solution to these pressing issues. This no-cost platform is available to all qualified NAR® members, MLSs, attorneys, and closing companies, providing a secure, streamlined solution to store, manage, and safeguard Buyer-Broker Representative Agreements. Don’t wait for the next wave of challenges to hit—act now with ConfirmBuyer.com to protect your brokerage, MLS, agents, participants, and transactions, and ensure compliance for the long term.
Please visit our website and experience the ease of use and significance of its purpose. If you would like a personal demonstration, please contact us anytime.
The official Buyer-Broker Representative Agreement repository for compliance, accuracy, and transparency.
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