Commissions
As you know, a seller ordinarily pays the brokerage commission to the listing broker.
In most cases, the listing broker then pays a share of the commission to his own agent (the listing agent) and another share to the selling broker.
The selling broker, i
Ownership of a Listing
Under the Real Estate Law, only a broker can directly represent a member of the public.
As a result, even though a listing agreement is usually prepared and signed by a salesperson, the listing is in the name of the broker and belongs to the broker.
EX. Y
Mortgage Foreclosure Consultant Law
Concerns about foreclosure rates have dominated the public agenda in recent years, as a growing number of homeowners have been affected by the national mortgage and credit crisis.
In response, California passed the Mortgage Foreclosure Consultant Law to p
Foreclosure consultant
Generally, the law imposes special duties on foreclosure consultants.
Anyone who offers (in exchange for compensation) to perform any service to:
-stop or postpone a foreclosure sale;
-obtain any forbearance from the lender;
-assist the owner in exercisin
Exemptions
The act contains certain exceptions; most significantly, it exempts real estate licensees providing brokerage services in connection with the listing of a residence in foreclosure, as long as the licensee does not accept any compensation until after the s
Requirements
If a person meets the definition of a foreclosure consultant, she must enter into a formal written contract with the homeowner, known as a foreclosure consultant service agreement.
If a person meets the definition of a foreclosure consultant, she must ent
Penalties
The penalties for violating the Mortgage Foreclosure Consultant Law are severe.
A wronged homeowner can sue the consultant for any violation of the act and may receive actual damages and attorneys' fees.
In extreme cases, punitive damages (of up to THREE
Antidiscrimination Laws
Fair housing laws and other antidiscrimination laws affect both how you obtain listings and how you market properties once they are listed.
Federal Fair Housing Act
The federal Fair Housing Act, part of the Civil Rights Act of 1968, makes it illegal to discriminate on the basis of race, color, religion, sex, national origin, disability, or familial status in the sale or lease of residential property, or in the sale o
Prohibited Acts
The Fair Housing Act prohibits any of the following actions if they are done on the basis of race, color, religion, sex, national origin, disability, or familial status:
-refusing to rent or sell residential property after receiving a bona fide offer;
-re
Blockbusting
(Panic selling)
Blockbusting occurs when someone tries to induce homeowners to list or sell their properties by predicting that people of another race (or disabled people, people of a particular ethnic background, etc.) will be moving into the neighborhoo
Panic selling
See Blockbusting
Steering
Steering refers to channeling prospective buyers or tenants toward or away from specific neighborhoods based on their race (or religion, national origin, etc.) in order to maintain or change the character of those neighborhoods.
Redlining
A refusal to make a loan because of the racial or ethnic composition of the neighborhood in which the proposed security property is located.
Rejection of a loan application must be based on objective financial considerations concerning the buyer or the pr
Federal Fair Housing Act: Exemptions
There are some exemptions from the Fair Housing Act.
However, these exemptions are very limited and apply only rarely.
The most important thing to remember about the exemptions is that they never apply when a real estate agent is involved in a transaction
Enforcement
The Fair Housing Act is enforced by the Department of Housing and Urban Development (HUD), through its Office of Fair Housing and Equal Opportunity.
In California, HUD may also refer complaints to the California Department of Fair Employment and Housing.
California State Antidiscrimination Laws
Real estate agents must also comply with the state laws that prohibit discrimination.
These include the Unruh Civil Rights Act, the Fair Employment and Housing Act, and the Housing Financial Discrimination Act.
In addition, California's Real Estate Law an
Unruh Civil Rights Act
One major state antidiscrimination law affecting real estate agents in California is the Unruh Civil Rights Act, which applies to business establishments.
A brokerage is a business establishment, so the professional activities of real estate agents are su
Unruh Civil Rights Act: Penalties
If someone is found to have violated the Unruh Act, they will be liable for the injured party's actual damages and attorney's fees.
If the discrimination is still ongoing, the guilty party may be ordered to cease and desist from discriminatory actions.
Th
Fair Employment and Housing Act
(Rumford Act)
Makes it unlawful to discriminate in the selling or leasing of housing.
It applies not only to real estate agents and housing developments, but also to individual property owners.
The Fair Employment and Housing Act specifically prohibits a
Rumford Act
See Fair Employment and Housing Act
Fair Employment and Housing Act: Exemptions
There are a few exemptions from the Fair Employment and Housing Act.
It doesn't apply to accommodations operated by nonprofit religious, fraternal, or charitable organizations.
It also doesn't apply when part of a single-family, owner-occupied home is ren
Fair Employment and Housing Act: Penalties
Housing discrimination complaints are investigated by the Department of Fair Employment and Housing (DFEH).
If mediation is ineffective, DFEH will file a lawsuit with the California Superior Court.
A violator who is found guilty may be ordered to sell or
Federal Fair Housing Act
-Applies to residential real estate transactions
-Protected classes: Race, color, religion, sex, national origin, disability, or familial status
-Noexemptions for transactions involving real estate agents
Unruh Civil Rights Act
-Applies to business establishments, including real estate brokerages
-Protected classes: Sex, race, color, religion, ancestry, national origin, disability, medical condition, genetic information, martial status, sexual orientation, age, and familial stat
Fair Employment and Housing Act (Rumford Act)
-Applies to the sale or lease of housing
-Protected classes: Race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, martial status, national origin, ancestry, familial status, souce of income genetic information, or di
Housing Financial Discrimination Act
(Holden Act)
Another state law you should be aware of is the Housing Financial Discrimination Act.
This law requires a lender to make a lending decision based on the merits of the borrower and the security property, rather than on the property's neighborh
California Real Estate Law
In addition to the federal and state laws already discussed, real estate licensees must comply with antidiscrimination provisions in the Real Estate Law and the Commissioner's regulations.
A licensee who engages in discriminatory activity in violation of
Complying with Fair Housing Laws
As you can see, these antidiscrimination laws cover a lot of territory.
You must become familiar with their provisions and know what activities are prohibited.
And you must remember that violating an antidiscrimination law does not require intent; if you
Compliance When Listing Property
When you're taking a lising, you should remember the following general rules.
Never say or imply that the presence of person of a particular protected class (race, national origin, etc.) in a neighborhood could or will result in:
-lower property values,
-
Compliance When Advertising Properties
After you list a property, your next step is usually to advertise it.
Keep in mind that you need to avoid discrimination in the way you market the property.
Sometimes apparently innocent statements or actions may be interpreted as discriminatory.
Suppose