Errors and Omissions Policy
I just spent about half an hour carefully reading my Errors and Omissions Policy for my real estate brokerage. Have you read yours? If you aren’t the broker, your excuse is that the broker probably doesn’t share it with you. If you are the broker, there’s no excuse! My current policy has a lot of fine print about the following: waivers for home warranties, coverage for drones, and fraudulently induced wire transfers. That’s on top of what is covered in general, because of the questions I had to answer, as the broker, about what we do, and how much of it we do.
There are a lot of brokers and agents who don’t read the fine print and find out too late that they aren’t covered for something they have been doing.
One of the things I urge every broker to check on, and then make a policy about in their office, is hybrid appraisals. If you haven’t heard of these yet, they are Fannie and Freddie’s latest shiny object. They are ‘performed’ by having someone (possibly a licensed agent, although the companies seeking them have been known to post the job on craigslist) go to a house, take pictures, take notes, and send them either directly to an appraiser, or back to the company, who sends them to an appraiser. The appraiser then performs a ‘desktop’ appraisal, meaning she is relying completely on someone else’s notes, opinions, and assessment of condition, etc. of the house.
As a bilingual person (I speak appraiser and agent because I’m both an appraiser and a broker), I wouldn’t touch one of these with a ten-foot pole. Many appraiser’s E & O policy does not cover the appraiser for this. But what about the agent? Suppose a loan is made based on this hybrid valuation? Suppose things go bad?
If you doubt for a minute that everyone who touched this transaction will be added to the lawsuit, you are naïve. As an agent, you are participating in the valuation of a property. You probably aren’t licensed for that, depending upon where you are. And, the money offered for these hybrid appraisals is low for both the agent (or whoever the inspector is) and the appraiser.
In my opinion, the risk just isn’t worth it.
Melanie J. McLane, REALTOR®, Broker of Record, Jackson Real Estate, RB067421; For real estate inquiries, call 570-398-1201, or the cell phone number at the end of this signature. Certified PA Residential Appraiser, and PA Certified Broker Appraiser. Real Estate Educator, AQB Certified USPAP Instructor, REBAC Hall of Fame 2008, RSPS of the Year 2012, ABR, CRS, CRB, EPRO, GRI, GREEN, RAA, RSPS, PSA, SRES, SRS, CDEI Certified Distance Educator. West Branch Valley Association of REALTORS®, REALTOR® of the Year 1994 AND 2017, Pennsylvania Association of REALTORS® REALTOR® of the year, 2018. For all things real estate, including education, email me at Melanie at TheMelanieGroup.com or call me at 570-660-9671.
Welcome to AE Talk. We are the resource for Association Executives of Real Estate Associations. This blog is powered by a partnership between RealTown and RE Altitude. We invite you to explore this site and maximize the value that you can bring to your association.
Many real estate agents are all about the leads. They ask questions like: Where can I get leads? How can I get more leads? And why don't my leads convert? But leads are only a small part of building a relationship with a client. Saul Klein and John Reilly spend some time examining the concept of leads and how to best consider this controversial topic.
You may love them, you may hate them, you may even be one! But attorneys perform a critical role in the real estate industry. Do you need one and if so when? Saul Klein and John Reilly (who knows a thing or two about lawyers) spend some time examing this interesting topic.
Presenting an offer is an exciting proposition for even the most seasoned industry professional. But this is also a delicate time fraught with pitfalls and confusion. Industry experts Saul Klein and John Reilly take a couple of minutes to hit the highlights of important parts to consider when navigating this critical detail of the real estate transaction.
We've often heard the mantra proclaimed by Saul, "Work for free, work for free, work for free, work for free, get paid." It's the call of the real estate agent and it's true even today. Saul Klein and John Reilly spend some time discussing the idea of working multiple jobs while making your way in the real estate trade.
Are you in or are you out? Did you know that data from the MLS is regularly harvested and utilized for all kinds of purposes? Did you authorize this? Maybe you did and you don't even know it! Make sure you understand the difference between opting in and opting out when it comes to the use of data in the MLS.
You've rented a property and collected a security deposit. Now what? There are lots of in and outs when it comes to managing a security deposit. Here Saul and John discuss the evolution of this concept and how managing this kind of situation can be tricky.
It's the most taboo topic in real estate. Even watching this video could land you in prison! But wait... Maybe somewhere along the way real estate agents got confused about what they really can and can't say about commissions. Saul Klien and John Reilly take some time to discuss this interesting topic and uncover some of the misconceptions about commissions in real estate.
Technology companies often make the mistake of developing products for the real estate professional without understanding the many ins and outs of working with the technology that runs real estate and the associations that control that technology. Long-time real estate expert Saul Klein dives deep in this video to explore the world real estate tech development and what issues must be considered before diving into real estate tech.
In real estate everybody represents the seller, right? Not so fast, this idea that was once a foundational part of the real estate business changed some time ago. Saul Klein and John Reilly take some time to examine the elements behind who can really represent the seller in real estate.
Communication Plan for Associations - What's Your Plan of Action? - In our decades of working for and with real estate associations across the United States, we've found the most common complaint coming from association staff and membership is regarding executive directed, organization-wide communication.
Communicating effectively at all levels of the organization seems to be a challenge for many associations. Great communication requires the creation of a communication plan and commitment to its implementation.
We've encountered this exact issue so often we've developed a communication implementation plan. Use these guidelines for enacting a new communication plan for your association. Or review these guidelines to ensure your current communication plan is robust and thorough.
Communication Plans Require the Following Considerations
ONE. Identifying the different channels of communication at your association. Some examples could include:
- Leadership to Staff
- Staff to Leadership
- Staff to Staff
- Staff to Member
- Member to Staff
- Member to Member
- Association to Public
- Committee Chairs to Committee Members
- Committee Chairs to Committee Chairs
- Committee Chairs to BOD
TWO. Identify benefits derived from effective communications and which of those benefits you wish to experience.
- Cost Savings
- More Participation
- Greater Understanding of the Workings of the Association by Everyone (Members, Staff, Public, etc.)
THREE. Identify current communication means used by your association and other tools you are not using.
- Social Media - Facebook/Twitter/RealTown Communities
FOUR. Identify sources of content to communicate besides the "as needed" communications.
FIVE. Decide which communication tools will be employed for each communication channel.
SIX. Determine the frequency of current communications down the channels identified.
- President to Board of Directors - Monthly by Meeting and Weekly by E-mail, Supplemented by Website
- Committee Chairs to Committees - Monthly by Meeting, Weekly by E-mail
SEVEN. Determine person responsible for ensuring the implementation of the communication plan.
EIGHT. Monitor results.
If you feel you need better communications at your association, what are you doing differently to accomplish your desired results?
We've heard insanity defined as doing the same thing over and over again and expecting different results. I think Albert Einstein said this, or maybe it was Ben Franklin, actually, it's probably a Chinese Proverb. But getting serious about communicating with your membership and the other people within your association is no laughing matter.
Too often Association Executives delegate communication plans to others, rubber stamp the entire process, or leave out disciplined communication entirely. But building, implementing and monitoring an organization-wide communication plan is one of the most important tasks an AE can endeavor.
What's your experience with communication within your organization? How did you overcome obstacles set in your path to deliver a great communication plan? We'd love to hear from you!
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