NAR Lawsuit - Questions Answers - We Sell Leisure Village

https://www.nar.realtor/the-facts/nar-settlement-faqs

Settlement Overview and Key Terms

1. Why did NAR enter into this settlement?

2. What are the key terms of the agreement?

3. Does this settlement mean that NAR is admitting that plaintiffs’ allegations are true?

4. By changing the cooperative compensation policy, aren’t you admitting that it was problematic?

5. What were the key factors that influenced NAR’s decision to choose the legal path it did for the settlement?

Who Is Covered

6. How do I know if I’m covered by the settlement?

7. Will I be covered by the settlement if I only became a member shortly before the date of class notice? Or, alternatively, dropped my membership shortly before the date of class notice?

8. Brokerages with an NAR member as principal whose residential transaction volume in 2022 was $2+ billion are not covered by the release. What about members affiliated with those brokerages?

9. What if an agent has different releases under the settlement (e.g., moved between brokerages?) Are they covered by the release in this settlement agreement?

10. How does the settlement affect corporate brokerages and any brokerages that are carved out from the release?

11. Why does the release of liability carve out some co-defendants and some of their affiliated agents?

12. How does the settlement affect state/territorial and local associations?

13. Are institutes, societies, and councils affiliated with NAR included in the release in the settlement agreement?

14. Does the fact that the release does not cover everybody mean that NAR has left large corporate brokerages and affiliated agents to fend for themselves?

15. What is the mechanism for brokerages with residential transaction volume in 2022 that exceeded $2 billion to obtain releases?

16. What is the mechanism for non-association MLSs to obtain releases?

17. Do association-owned MLSs need to do anything to be covered by the release?

Practice Changes

Offers of Compensation

18. Is it possible for offers of compensation to be conveyed through channels other than the MLS?

19. How will buyer brokers get paid now?

20. What should listing brokers advise their clients about the prohibition of offers of compensation on an MLS?

21. Why was prohibiting the publication of compensation offers in the MLS part of the settlement?

22. Is it possible for offers of compensation to be conveyed through channels other than the MLS?

23. How will offers of compensation be communicated if brokers can’t use MLSs? Doesn’t this just make broker compensation less transparent?

24. Are independent MLSs affected by the prohibition of publishing compensation offers on the MLS?

25. Does this prohibition affect the compensation amount paid to the listing broker?

26. Are commercial listing services that don’t pull from the MLS subject to the practice change prohibiting offers of compensation on the MLS?

27. How does this affect the existing listing agreements that authorize an offer of compensation to be made in the MLS?

28. How would this prohibition affect pending transactions?

29. What steps will buyers’ agents need to take to ensure they are being paid for their services?

30. Does this mean buyers won’t have to use a buyer broker to purchase a property?

31. Can a buyer request the listing broker to pay compensation to the buyer broker?

32. How would the prohibition of offers of compensation on the MLS affect pending transactions/current deals?

33. Doesn’t moving offers of compensation off-MLS introduce friction into the homebuying process? What happens if a buyer broker can’t get timely information from a listing broker about offers of compensation?

34. Wasn’t the purpose of publishing offers of compensation on the MLS to promote transparency? Doesn’t moving offers of compensation off-MLS reduce transparency?

35. Won’t prohibiting offers of compensation on the MLS raise fair housing issues?

36. If my MLS removes the compensation field, can I choose to publish my cooperative commission offer in the agent remarks?

37. How long until the offer of compensation field needs to be removed from MLSs?

38. Does this prohibition affect the compensation amount paid to the listing broker?

39. Does this mean buyer brokers may have to work for free?

40. Can a buyer request the listing broker to pay compensation to the buyer broker?

41. How will offers of compensation be communicated if brokers can’t use MLSs? Doesn’t this just make broker compensation less transparent?

Written Agreements

42. Does the requirement to use a written agreement before showings apply to commercial transactions?

43. If a commercial broker who is a REALTOR has access to an MLS, but is showing a property on CIE or another platform that is not associated with an MLS, does the requirement to use a written agreement apply for that property?

44. Who will be responsible for enforcing the written agreements and ensuring all parties follow this new practice change?

45. Will written agreements be needed for walk-in viewings (e.g., office or open houses)?

46. The practice change requiring written agreements with buyers is triggered by two conditions: it only applies to MLS participants “working with” buyers and is triggered by “touring a home.” What does it mean to be “working with” a buyer?

47. How will state laws affect the implementation of the practice change requiring written agreements with buyers?

48. What does it mean to tour a home?

49. Does the requirement for a written agreement with buyers mean that MLS participants and buyers must enter into a written agency agreement?

50. If an MLS participant hosts an open house or provides access to a property, on behalf of the seller only, to an unrepresented buyer, will they be required to enter into a written agreement with those buyers touring the home?

51. Are written buyer agreements required when listing agents talk with a buyer on behalf of a seller only or as subagents of the seller?

52. Are written buyer agreements required when MLS participants perform ministerial acts?

53. Are written buyer agreements required in a dual agency scenario, when a single agent works both for the seller and for the buyer?

54. Are written buyer agreements required in a designated agency scenario, when a single broker works both for the seller and for the buyer, and designates an agent to represent the buyer?

55. MLS participants may not receive compensation for services from any source that exceeds the amount or rate agreed to in the buyer agreement. Does this mean that brokerages can only have one agreement with the buyer?

56. In the buyer agreement, can buyers and buyer brokers agree to a range of compensation?

57. Should active buyer agreements entered into before the MLS policy change be amended to make sure any compensation is not open-ended and is objectively ascertainable?

58. Should active buyer agreements entered into before the MLS policy change be amended to remove any provision that authorizes the buyer broker to keep any offers of compensation exceeding the amount of compensation agreed with the buyer?

59. Should active listing or buyer agreements entered into before the MLS policy change be amended to include a conspicuous disclosure that compensation is not set by law and is fully negotiable?

60. Can buyers and buyer brokers rely on an offer of compensation that was on the MLS prior to the effective date of the MLS policy changes?

61. Does the settlement agreement’s requirement of “objectively ascertainable” and “not open-ended” apply to listing agreements or the compensation sellers pay listing brokers?

62. Should active listing agreements entered into before the MLS policy change be amended to address the settlement agreement’s prohibition on offers of compensation being communicated on the MLS?

Other

63. How does the settlement affect home sellers and home buyers?

64. Will this prohibition save money for sellers or buyers?

65. How does the settlement affect MLSs?

66. What is the value of an MLS?

67. Does Standard of Practice 16-16 prohibit the negotiation of buyer broker compensation in a buyer’s purchase offer?

68. What do these practice changes mean for commercial practitioners?

69. Why is NAR putting the practice changes in place prior to receiving final approval?

NAR Operations

70. How will NAR fund the settlement?

71. How does this settlement change NAR’s value proposition? Why should real estate professionals continue to be NAR members after this news?

72. Who at NAR signed off on the settlement and was the decision to settle subject to proper NAR governance procedures?

73. In what ways did NAR attempt to include all members in the settlement process, and what were the limitations?

74. What was NAR’s overarching strategy with the settlement and why did NAR choose to not more actively advocate for its position in the public domain during the legal negotiations?

75. Why is NAR paying so much more to settle than the corporate defendants did?

76. Does the settlement affect NAR’s ability to continue operating?

77. Can NAR use reserves to pay for the settlement? If so, how much?

78. What does this settlement mean for NAR advocacy efforts? Is there still funding available for those efforts?

79. Will NAR raise dues or levy an assessment on members to fund the settlement?

80. How quickly do you expect the settlement to be reviewed and/or approved by the court?