Section 14
Risk Reduction
44 policies
- 14.1Risk Reduction PoliciesThe Company advocates and encourages the concept of risk reduction. A majority of claims filed against real estate agents and brokers allege some form of…
- 14.2Compliance with All Laws, Rules, and RegulationsAs an agent of the Company, each person assumes the obligation of strict compliance with all laws, rules, and regulations which govern real estate licensees in your…
- 14.3Compliance with This Policy ManualAs an Associate of the Company, each person agrees to comply with all policies as stated in this manual and its additions, changes, and amendments as published from time…
- 14.4Physical Condition of PropertyIn accordance with the REALTOR® Code of Ethics, Real Estate Commission Rules, and the State real estate licensing law, the policy of the Company is to disclose to all…
- 14.5“Stigmas” on PropertyMost state laws require that sellers disclose the fact that a property was occupied by a person who died in the property. Most state laws also require a Megan’s Law…
- 14.6Documentation of DisclosureAs is apparent, the Company advocates full disclosure in appropriate circumstances. However, all the disclosure in the world does no good if it cannot be proven. While…
- 14.7Use of Experts and "Recommendations"The Company maintains a strong policy that agents not go beyond her/his area of expertise regarding a transaction. The company strongly recommends that an agent advise…
- 14.8Managing Risk and Liability TrainingAs stated in other parts of this manual, training and education are integral parts of any risk reduction and professionalism program. All agents are expected to complete…
- 14.9Use of Legal CounselWhenever an agent believes she/he requires legal assistance, the Broker or Manager should be contacted. The Company has legal counsel for appropriate legal questions and…
- 14.10Errors and Omissions InsuranceThe Company shall maintain Errors and Omissions Insurance coverage with an insurer designated by the Company. Currently, the Company charges a per transaction fee of…
- 14.11Complaint Handling ProceduresOne of the simplest and most cost effective risk reduction methods is a good complaint handling process. Accordingly, the Company establishes the following procedures…
- 14.12Adoption and Enforcement of Written PoliciesThe Company has adopted the following written policies and procedures that define the company’s agency representation policies, competitive practices, fair housing…
- 14.13Sharing Current Legal Situations at MeetingsCompany policy is to educate all Associates by sharing current legal situations so they can learn from other Associate’s experience. During meetings and normal business…
- 14.14Risk AnticipationCompany policy is to anticipate risk, then work to minimize that risk by all ethical means. Risk anticipation refers to identifying typical or potential problems that…
- 14.15Documentation and Record KeepingCompany policy is to document and record all communications with clients, customers, other agents, or any third party that is part of any transaction (complete or…
- 14.16Risk ControlCompany policy is to control risk by all ethical means. Of primary importance is dealing with any complaint or potential for complaint before it turns into litigation…
- 14.17Risk ShiftingCompany policy is to shift risk when possible and ethical. Shifting risk from the licensee to another party is a desirable strategy to minimize risk. An example of…
- 14.18Managing Internet RisksCompany policy is to provide a Privacy Policy on any website that the Company or Associate is advertising.
- 14.19Privacy IssuesCompany policy is to keep all information received by customers or clients completely confidential. Associates receiving and storing confidential personal information on…
- 14.20Common Areas of RiskThe Company policy is to be aware of the most common areas of risk and report any risk to the Broker or Manager as soon as one is identified. The majority of risk…
- 14.21Associate SupervisionThe Company policy is to monitor and supervise any Associate working with the Company at all times. Proper supervision requires cooperation from the Associate so the…
- 14.22Avoiding the Unauthorized Practice of LawCompany policy is that Associates are not to engage in the unauthorized practice of law. To do so is grounds for suspension or revocation of their real estate license…
- 14.23Contract Law LiabilityIf the licensee fails to perform the contract as agreed, the licensee is in default or in breach of contract. The breach of a contract, in its most basic form, is the…
- 14.24Attorney’s feesAttorney’s fees, unless authorized in the contract or by statute, are usually not recoverable. The contract should state that attorney’s fees would be due to the…
- 14.25Specific PerformanceReal estate licensees should note that personal service contracts cannot be enforced by specific performance by either party. Personal service contracts include listing…
- 14.26Intentional Concealment- Non Disclosure of Material Fact (as opposed to False Representation) - Intent to Deceive - Misleading Statement was Relied Upon by Complainant - Actual Damages Result…
- 14.27Offering OpinionsA licensee may notice a red flag that demands further investigation and comment to the buyer that the problem can be "easily solved." In giving opinions, licensees…
- 14.28Real Estate Settlement Procedures ActAll Associates should be familiar with the laws and regulation of the Real Estate Settlement Procedures Act (RESPA).
- 14.29Prohibited Settlement Practices: Kickbacks, Fee-Splitting, Unearned FeesRESPA prohibits anyone from giving or accepting a fee, kickback, or anything of value in exchange for referrals of settlement service business involving a federally…
- 14.30RESPA Section 9 - Seller Required Title InsuranceRESPA Section 9 prohibits a seller from requiring the homebuyer to use a particular title insurance company, either directly or indirectly, as a condition of sale…
- 14.31Real Estate LawAs a part of any risk management program, a licensee must be familiar with real estate law and regulations. A licensee must also comply with record keeping requirements…
- 14.32Potential LiabilitiesThe following section should be read by all Associates to gather a general understanding of potential liabilities that exist to various policies and procedures covered…
- 14.33Potential Liability Relating to Agency RelationshipsThe Company permits disclosed dual agency. Therefore, certain pros and cons exist and as the associate, you should study and understand the risks involved. - Pros…
- 14.34Breach of Fiduciary DutiesCare If an agent represents a seller, care and skill may include assisting the seller in: - Establishing a realistic market price. - Advising the seller in making the…
- 14.35Potential Liability Relating to Fair HousingCompany policy is to follow the Fair Housing laws at all times.
- 14.36Prohibited ActionsIn the sale or rental of property, unless an exemption applies, no Associate may take any action that will discriminate against another in the seven protected classes…
- 14.37The Role of Federal, State, and Local Governments in Fair Housing LawThe Department of Housing and Urban Development (HUD) has been given the task of administering the federal fair housing laws. Rules and regulations developed by HUD have…
- 14.38DisabilityA disability for purposes of fair housing laws may be defined as a physical or mental impairment that substantially limits one or more major life activities.
- 14.39Fair Housing Laws as Applied to Those with DisabilitiesFederal fair housing law, as set forth above, provides for the following with respect to persons with disabilities: - It is unlawful to refuse to rent to someone with a…
- 14.40Familial StatusThe Fair Housing Amendments Act of 1988 added familial status as a protected class to the Federal Fair Housing Act of 1968. It is unlawful under this act to deny housing…
- 14.41Fair Housing Practices (Definitions)Redlining Refusing to make mortgage loans or issue insurance policies in specific geographical areas for reasons other than the qualification of the applicant is known…
- 14.42Potential Liability Relating to Environmental IssuesThe real estate licensee’s responsibilities with regard to environmental issues are: - To recognize common environmental hazards in residential properties such as…
- 14.43Potential Liability Relating to Antitrust Law ViolationsPrice Fixing Due to the nature of a price fixing case, the best advice that can be given to any real estate licensee is NEVER DISCUSS WITH OTHER LICENSEES THE…
- 14.44Reducing Antitrust Liability- When discussing commission rates with clients, licensees should use language clearly indicating that their firm sets their commission rates unilaterally and…
