by Bill Altier
After reading the responses posed by Loretta Alonzo, future president of IAR, I was inspired to submit my own blog detailing my responses to her article. To see her original responses, please click here.
In response to the question, “Is there anything going on in the industry right now that you’d like to change?” I would like to suggest that the following three matters be considered by IAR, as well as the Chicago Association of Realtors.
1). Our industry needs a standard for calculating square footage. As a result the public’s interest is compromised. Developers and Realtors (some do and some do not) include decks, balconies, garages, terraces, patios and many other features. As it is now, the lack of a standard for calculating space, it is impossible to understand one of the most important factors in determining value as well as make relevant property comparisons.
2). To require all agents to become licensed brokers is not enough. In my opinion the reason for the requirement is twofold: first to enhance our agents’ image in the eyes of the public, and second the cost of school/exams is another revenue source for the Realtor Association.
In my opinion, Illinois needs to eliminate excessive legal exposure placed upon each company’s broker of record and make these new brokers solely accountable for their own actions. It is my understanding that the state of Colorado has eliminated the broker’s liability and placed it upon the broker’s licensed brokers. I believe the broker of record should be held accountable to ensure his/her broker/agents attend the required state of Illinois courses; but beyond that, unless it can be proved the company’s broker of record had prior knowledge of his/her broker/agent intended illegal actions, such broker and broker’s owner should not be libel.
3). We need a way to ensure an accurate MLS record of the seller’scCredits given to the Purchaser at the time of closing. There are far too many closings posted in the MLS which do not reflect substantial buyer credits. The MLS is the most read and publicly trusted intelligence source for everyone: CMA’s, appraisals, owners, sellers, buyers, community leaders, banks/lenders.
One way of doing this might involve the title company or perhaps the listing agent recording the changed closing status, being required to scan/send the appropriate portion of the RESPA.
I am happy to discuss any of these ideas further.
Bill Altier is a broker associate with Koenig & Strey Real Living, he can be reached at 312.735.3124.
Hi Bill:
I reviewed your comments and commend you on your suggestions. I have been a broker for 27 years [former broker owner, former Broker Manager for Coldwell Banker Honig- Bell, Director of New Agent Development for
RE/MAX TEAM 2000, and currently Broker Manager for Classic Realty Group in Frankfort, IL. I also have my Real Estate Pre-Licensing Instructor’s License, although I am not currently teaching.
There are so many things that I see that need attention in our industry, and one of my suggestions for change to IAR was that their
requirement that “earnest money be deposited 24 hours from “acceptance” as opposed to “receipt” by Managing Broker is, in most cases, not humanly possible. We had an audit and the IDFPR auditor insisted that all earnest money must be deposited within 24 hours of acceptance, otherwise broker/broker manager were in violation of the law. I participated in an IAR Webinar with the Legal Dept. and when I questioned them about this, they commented “well, obviously if you don’t have the money you can’t deposit it”. I responded that I had said this to the auditor, and he insisted that I would still be in violation. When I told the auditor, “Oftentimes we write offers in which the parties to the contract agree that earnest money is to be delivered within 48 or 72 hours from acceptance”…he still insisted we would be in violation. My suggestion was that they change the
law to “receipt of earnest money pursuant to the terms of the contract”. Wonder what you think about this, Bill.
Also, what about the new requirement that a Buyer’s Disclosure [form 349] be given to every buyer upon first meeting to show a property?
I see this as a senseless form because 1] It does not require the prospective buyer to sign it…only the agent’s signature is required.
Requiring brokers to have a file in which all 349 Forms are kept is
also senseless, in my opinion. Firt of all, even if agents turn these forms in to the broker/broker manager, how could anyone determine if the agent actually gave the form to the buyer or just completed it and turned it in? What is your take on this, Bill?
Polly Forst CRS, GRI, CNC
Broker Manager
Classic Realty Group
20500 S. LaGrange Rd.
Frankfort, Il 60423
708-945-5760
Greetings Polly,
As you know, earnest money is not a requirement to make a contract binding and many offers are written where earnest money is due within x-number of days after acceptance as well as additional monies due upon future dates or events during the term of the transaction.
I am a licensed real estate agent and not a lawyer; therefore I am not qualified to answer your legal question concerning how a broker would be in violation for not depositing earnest money which is not submitted by the buyer according to the terms of the contract.
My understanding, however, is that if the purchaser has not submitted the earnest money within the time frame of the terms of the real estate contract, the purchaser maybe in violation of the contract.
The broker’s responsibilites would be to immediately inform all parties (coop agent if any, lawyers and principals) in writing and by phone that he/she did not receieve the earnest money upon the date contracturally agreed to by the seller and buyer.
In my opinion, the auditor’s warning of the broker’s violation is not correct. If the broker is in violation, then I would certainly agree the Illlinois law needs to be changed.
As for the Buyer Disclosure Form, I believe it serves the public to require that all agents disclose agency to every prospective purchaser upon the first significant meeting. I have found that most buyers that do not desire agent representation will not sign the disclosure; but having the agent print the customer’s name & sign/date and place the disclosure form in the listing’s file is a good business practice to avoid misunderstanding.
Thanks for taking the time to respond to my letter and expressing your concerns.
Best regards,
Bill Altier
Broker Associate
Koenig & Strey Real Living
312-261-8606
Greetings all,
In reference to “calculating sq footage”, I would first like to see that filling out the sq ftg form on single family homes and condos listings be MANDATORY
Its very frustrating to look at a client and say “well . .I really dont know how big the place is because the agent was too lazy to fill this field out”. It seems that the majority of listings do not have the sq ftg field filled out, so its not even practical to search by sq footage for a buyer client.
And Bill, is right. It makes it impossible to do quality value comparisons and valuations, whether you are a buyer agent or an appraiser using the system.
And yes, many agents exaggerate, miscalculate or even outright lie about the sq ftg. Which presents other problems. The developers over state the initial sq ftg numbers. Then after build out, the place has even smaller interior sq ftg.
When I see “1400 sf” (which seems to be the common 2 Br 2 Ba new construction condo size), I automatically think “1150 sf”, lol
So, yes. I agree. It would be nice to see sq ftg issues resolved and make it mandatory to include them in all single unit listings. And a way for agents to dispute if they feel the real number is off by 10% vs the actual sq ftg.
Thanks,
Michael Ramstedt
Broker/Owner
Historic Realty, Inc
312-243-4033
Hi Bill,
I totally agree on the square footage issue. There needs to be a standard on what is included. There is a comparable that keeps haunting me in my market analysis because the agent included the basement.
Good ideas !