Legal Disclosures on Personal Sales & Sales Involving a Relative:
If you are working with a blood relative or someone you are related to by marriage - always disclose. This should be disclosed in MLS (if it's your listing), on the offer form, and in the purchase agreement. Disclosure is required by law.
If you are putting in an offer on a personal transaction, always disclose it on the offer and be sure it is carried over to the P&S. This is required by state licensing law. If you are a listing agent on a property that you own, you must disclose your interest in MLS (firm remarks), in the offer, and in the purchase and sale agreement.
Agent is a Member of an LLC that is Selling or Buying Real Estate:
If you are buying or selling real estate under an LLC, you must disclose the same as if it were being purchased or sold under your name.
Agents Buying or Selling Personal Real Estate:
Agents are more than welcome to waive the commission on the purchase or sale of real estate. If a commission does come into the company, LAER will take 5% plus $35 for E/O insurance. Again, the agent is more than welcome to waive the commission altogether on personal transactions involving a primary residence, in which case the agent will save paying the 5% and $35 for E/O insurance to LAER. Please note, that if you want to have E/O insurance in place on the sale, you should read about the E/O policy requirements on agent owned properties below.
Agents Selling a Home for a Relative or Representing a Relative in a Sale:
If a commission is taken, LAER will receive its regular split (per the agent's Independent Contractor Agreement) on these transactions.
Agents on Teams:
If you are on a team, you should discuss the commission rate for personal transactions or for transactions with relatives with your team leader as each team has its own policy as to what commission rate shall be charged.
Agents Who Flip/Develop More Than Two Investment Properties a Year:
If you are an agent who regularly flips or develops real estate, you may waive your commission on up to two transactions a year (subject to approval by your team leader). If you plan on developing or flipping more than 2 transactions a year, you should email the Happy Agent Team at HappyAgent@LAERRealty.com for clarification as to what must be charged.
E/O Insurance On Personal Deals:
The E/O insurance carrier that LAER works with has very precise guidelines for E/O insurance coverage on transactions owned by a LAER agent. The E/O carrer will require certain items in order to cover the property for E/O insurance. These are the requirements you must meet on any sales in which you are part owner.
- The buyer must complete a home inspection on the property (buyer cannot waive this).
- You must disclose in the purchase agreement that the property is owned by you. (This is required by law as well)
- You must purchase a Home Warranty for the buyer.