Quick Skim

One in five real estate practitioners will be involved in a lawsuit during their career, says real estate broker Barbara Nichols in The No-Lawsuit Guide to Real Estate Transactions (McGraw-Hill, 2007). The effects can be just as damaging to your reputation as it is to your pocketbook. So how do you make sure you don’t end up in court? There are some obvious lines you know to never cross, but there are far more gray areas that can land you in trouble for nondisclosure, steering, or even false advertising. Nichols gives advice on navigating these potentially risky situations.
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From the Book: 5 Ways You Could End Up in Court

Real estate lawsuits often stem from what you say — or don’t say — to your client. Bottom line: You’re obligated to report any property information, both onsite and offsite, that could impact the property’s price or a buyer’s decision to buy. Nichols outlines these common legal mishaps for practitioners:

1. Not disclosing property stigmas. Prospective buyers need to be told if a anything in a home’s past could potentially scare off future buyers or hurt the property’s resale value. What counts as a stigma? It could be a murder that once occurred in the home, a rumored haunting, or a history of foundation problems (even if the seller spent thousands of dollars fixing the foundation, future buyers could be hesitant to make an offer). If you don’t disclose any potential stigmas, you could be held liable when the clients find out. So do your research and be sure you know the home’s history.

2. Using risky words. How closely do you proofread your advertising copy? No matter how well-intentioned you are, you could be sued for discrimination or unlawful steering if you use terms such as “perfect for young married couple,” or “no children under age 10.” You’re obligated to provide fair access to properties to everyone, unless the development has been classified as a restricted age community or a “senior citizen residence.” In addition, you shouldn’t talk about the racial or ethnic diversity of a neighborhood even if your clients ask you. However, you can provide general information that would be found in a community profile, such as the average price ranges of properties, education and income levels, and religious facilities.

3. Overlooking a property defect. While you’re not expected to have the expertise of a property inspector, you are required to disclose “any known or readily observable property

defects to buyers and sellers,” Nichols writes. She recommends putting all details from your visual property inspection in writing, and then deliver your notes to all parties involved in the transaction. To do a visual inspection, evaluate the property starting with the outside of the building (Is the brick cracked on an exterior chimney?) and then work to the inside (Are there any signs of mold or mildew on walls or floors? Are there cracks in the walls?). Avoid using sweeping statements such as “I don’t see any defects” or “this property is in excellent condition,” since a defect-free property doesn’t exist.

4. Failing to meet fiduciary duties. Your duty includes being loyal by acting in your client’s best interest, not your own self-interest, and obeying all lawful instructions that your client gives you. You’re also responsible for disclosing all relevant information during the transaction, keeping your client’s personal information confidential, exercising reasonable care and diligence, and accounting for all money or property belonging to the client that is given to you. Plus, if applicable, be sure to reveal dual agency — when you’re representing both the buyer and seller — which can create extra levels of challenges that often result in lawsuits.

5. Passing along bogus information. Ignorance is no defense in court. When it comes to misrepresentation, it’s easy to get in trouble by simply not knowing the facts. You could be held liable for not verifying information you pass onto your client, giving incorrect professional advice that you should have known was wrong, or even simply repeating bad information that your seller tells you. So be sure to triple-check that all property details are correct, and have the seller review it, too.

Sneak Peek

“Participants in any capacity in today’s real estate market know how complex the typical transaction has become. It seems that every day another document is added to the contract or the disclosures. Average buyers need treatment for writer’s cramp after signing volumes of transaction documents. It is usually at this point that the buyers start to feel panic. … The sellers may be experiencing another kind of panic. Have we sold for enough money? Should we have told the buyers about something else? Did we forget to mention something? … There has never been a time when more was demanded of real estate agents to meet the requirements of their profession and the needs of their clients and customers.”

About the Author

Barbara Nichols is a real estate broker and owner of Nichols Real Estate and General Contracting. She has served as a witness on numerous real estate-related lawsuits involving agents and their brokerages. As a supplement to her book, she has created “How to Stay Out of Court,”, training and workshop materials about risk management and liability issues for real estate professionals.

Check back on Monday, Aug. 6, to read Nichols’ responses to your already submitted questions.

Posted on July 27 at 01:30 AM | Permanent Link | Add a Comment (9)

Here are today’s top sellers in real estate sales, according to Amazon.com:

1. FLIP: How to Find, Fix, and Sell Houses for Profit, By Rick Villani, Clay Davis, and Gary Keller

2. Success as a Real Estate Agent for Dummies, By Dirk Zeller

3. The Complete Guide to Buying and Selling Apartment Buildings, By Steve Berges

4. 1,200 Great Sales Tips for Real Estate Professionals, Edited by Mariwyn Evans and Christina Hoffman Spira

5. Confessions of a Real Estate Entrepreneur: What it Takes to Win in High-Stakes Commercial Real Estate, By James A. Randel and Jim Randel

6. Real Estate License Exams for Dummies, By Drei John A. Yoegel

7. How to Become a Power Agent in Real Estate: A Top Industry Trainer Explains How to Double Your Income in 12 Months, By Darryl Davis

8. How to Succeed in Commercial Real Estate, By John L. Bowman

9. Secrets of a Millionaire Landlord, By Robert Shemin

10. How to Sell Your Home in 5 Days: Second Edition, By Bill G. Effros

Posted on July 16 at 09:43 AM | Permanent Link | Add a Comment (0)

Quick Skim
Ever struggle to remember a past client’s name or the precise details of your listings? For anyone who’s had a memory blip, there’s good news — you can train your brain to recall even the most miniscule details, says author Gini Graham Scott. In 30 Days to a More Powerful Memory (AMACOM, 2007), Scott reveals interesting new findings from brain researchers and psychologists. After all, knowing more about how your brain works helps you squeeze more information in (and out) of it. The best challenge: Trying to recall her many clever systems after reading the 266-page book.
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From the Book: 5 Ways to Get More from Your Memory

Before you wake up tomorrow, you’ll have forgotten about 70 percent of what you learned today, Scott says. Some of that information is trivial, no doubt, but other information could be important for your business or customer relationships. To retain more of what you learn, Scott suggests these tips:

1. Make it all about you. If the information seems important to you personally, you’re more likely to remember it — and to remember in greater detail. This method, called “self-referential,” encourages you to be selfish: Will this information increase your profits, or will this person help bring you more referrals? Is there any association, image, or past experience to which you can relate this information? Also, try to spin the information in a positive way; that increases the odds you’ll remember it.

2. Pay attention — for real. It seems obvious, but a weak memory is often a sign you simply didn’t concentrate enough. For example, you meet a new prospect and immediately forget his name. Why? You were so concerned about making a strong first impression that you didn’t really listen to his introduction. Have a mental trigger (such as moving your toe or wiggling your fingers) to remind yourself to listen closely and stay alert. Practice your mental trigger so the association becomes automatic. Another way to get yourself to absorb the information: React and comment mentally or physically to what you’re hearing the other person say.

3. Chunk it with reason. Psychologist George Miller’s “Magic Number of Seven” principle

states that you can only hold about seven items in your short-term memory at a given time. However, you can increase that number dramatically if you organize information together in categories. Divide the information logically, not arbitrarily. For example, group people’s names by their jobs or where they live. For a presentation, develop an outline to group similar types of information together. This will help you recall key words to guide your talk, and prevents the distractions that come with trying to remembering everything word-for-word.

4. Rehearse the facts. Whatever material comes into your short-term memory is often lost if you hold onto it for less than a minute, research shows. Therefore, you need to repeat to remember. Describe or explain the information to yourself or others, which may even trigger additional related memories. Or, pretend you’re an announcer on a radio program and describe whatever you want to remember, making it as dramatic and exciting as possible.

5. Feel your memories. Memory tends to improve when an experience is encoded with images and other senses. So put yourself mentally or physically in the place where the event or experience occurred. See yourself re-experiencing it. Imagine yourself as a camera, zooming in on a scene. Then replay the scene in your mind, letting your intuition or unconscious mind trigger memories from the setting. This technique is not as effective at recalling large amounts of factual information, but is good for finding lost keys or remembering property details.

Sneak Peek

“One of the biggest reasons for wanting to improve your memory is to better remember names and faces. It’s something that people who deal with the public — such as salespeople and politicians — are particularly concerned about, and it often can make the difference between getting the sale or the vote … or not. After all, when you remember someone’s name — and can further personalize that by what you remember about that person — he or she is flattered; people feel appreciative that you remembered them. And that can translate into votes, sales, gaining customers, getting referrals, and more.”

About the Author

Sociologist Gini Graham Scott is the author of more than 40 books, including A Survival Guide to Managing Employees From Hell (AMACOM, 2006), Resolving Conflict (iUniverse, 2006), and Mind Power: Picture Your Way to Success in Business (iUniverse, 2006). She is the founder and director of Changemakers and Creative Communications & Research, a video and music production and publishing company based in Oakland, Calif.

Posted on July 2 at 08:45 AM | Permanent Link | Add a Comment (1)