Introducing Brooklyn Welsh, born November 1, 2008, daughter of my little brother, Daniel & Tricia Welsh."

Introducing Brooklyn Welsh, born November 1, 2008, daughter of my little brother, Daniel & Tricia Welsh.

November 4, 2008

Update on the Net Listings in MLS

This is an update to my May 23, 2008,  “Net Listings in MLS” [TGIF Legal Tip: Net Sales Listings in the MLS]

Forrest Barbee, Director Of Education & Brokerage Information at PRUDENTIAL, AMERICANA GROUP, REALTORS® updates this subject.

By, Forrest Barbee:

We have been bombarded this past couple of weeks with questions related to commissions being paid on a net sales price.  This is where the commission is computed by taking the gross sales price and reducing it by seller’s concessions in order to determine a net commission on an REO listing.  (Note: The discussion that follows does NOT apply to Short Sales.) This issues remains with us because there are a number of banks or asset managers that have structured their REO listing agreements in this fashion.  In fact, NAR allows each local board make a determination as to whether this type of commission will be permitted or not.  The GLVAR participants (one representative from each brokerage) debated this item at length, but ultimately voted it down for our area.

Section 5 of the most current version of the MLS Rules and Regulations deals specifically with this item as follows:

The compensation specified on listings filed with the Multiple Listing Service shall appear in one of two forms.  The essential and appropriate requirement by an Association Multiple Listing Service is that the information to be published shall clearly inform the Participants as to the compensation they will receive in cooperative transactions, unless advised otherwise by the listing broker, in writing, in advance of his producing an offer to purchase.  The compensation specified on listings published by the MLS shall be shown in one of the following forms

1. by showing a percentage of the gross selling price

2. by showing a definite dollar amount

Multiple Listing Services shall not publish listings that do not include an offer of compensation expressed as a percentage of the gross selling price or as a definite dollar amount, nor shall they include general invitations by listing brokers to other Participants to discuss terms and conditions of possible cooperative relationships.

So here are some tips to help you out here. First we have discovered that some of the banks/asset managers have listings or riders for areas that allow net commission sales and for those that do not allow this activity.  If you are the listing agent of one of these REO properties you may want to have this discussion with the bank prior to taking the listing; they may accommodate you with a listing or rider appropriate to Las Vegas.  Then, please keep in mind that all listing contracts other than the GLVAR contract needs to be submitted to GLVAR for review and approval. This can help you prevent an unnecessary fine and potential removal of the listing from the MLS

In all cases the selling agent is entitled to a commission based upon the gross selling price – regardless of what may be in the listing agreement.  Therefore the listing agent is liable to pay a commission based on the gross sales price to the selling agent – even in the event they are unable to obtain this amount from the seller (bank).  As a member of GLVAR and the MLS, Americana Group will abide by the MLS rules that govern this issue.

I have also been asked about what other recourse is available to those who may disagree with the current MLS stand on the net commission issue.  First, I would urge any Americana REALTOR who can spare a few hours each month to volunteer to serve on one committee of your choice.  Your voice – as a working, practicing REALTOR – needs to be heard at the Board.  Individually and collectively we can make a difference, but we must participate to do so effectively. Next, I would recommend that if and when you have challenges or concerns about MLS rules, procedures, and policies, please contact a current MLS committee member by phone or email to voice those concerns.  Your questions and feedback will provide the MLS Committee with better information for their meetings, discussion, debates that result in recommendations to the Board of Directors where the MLS is concerned.  For a list of MLS Committee members, go to:

www.lasvegasrealtor.com

Login and then select Committees at the top of the screen. 

Let’s all find a way to be part of the solution as we deal with the difficult issues facing us and our business.

Forrest Barbee of Prudential, Americana Group, REALTORS® can be contacted at 7027967777 or via email at Director Of Education & Brokerage Information

THANK YOU FORREST.

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