NAR on Love Letters and Love Videos:

https://www.nar.realtor/fair-housing-corner/love-letters-or-liability-letters

Short safe answer: Don’t use love letters/videos. Don’t accept love letters/videos.

Long answer: Consider having a listing brokerage policy to discuss and get seller direction to avoid receiving and never presenting love letters/videos to the sellers. Discuss this issue with other real estate licensees who may be unaware of the fair housing issues that can arise with love letters/videos. Have the BICs talk if the licensees cannot work this fair housing risk issue. License law does not require presenting love letters to the seller. NAR is aware of this issue, so ethics do not require presenting love letters to the seller.

Love letters/videos arise because buyers and buyer reps are looking for every advantage in multiple offer competitions in a market with low housing inventory.

Highest and best terms offer is a simple way to gain multiple offer advantage without fair housing, legal risks.

Other advantage seeking strategies beyond love letters/videos can include escalation/escalator clauses.

Sellers generally realize that escalator/escalation clauses are usually not in the seller’s best interests as the buyer is attempting to buy below the buyer’s highest and best terms so sellers typically discourage escalator/escalation clauses or counter offer at the escalator/escalation cap price.

Other buyers generally realize that other buyers’ escalator/escalation clauses are not in their best interests and so may have a lawyer draft a seller non-disclosure agreement to prevent their own offer being used against their best interests by other buyers.

REALTORS® and buyers need a lawyer to draft/review all legal language added to standard forms from the association and/or their own brokerage.

Fair housing risks of love letters/videos are that the licensees and/or sellers may be accused of discriminating based on fair housing protected classes.

Example: Dear Seller, We love your house. Please choose our offer. As a same sex couple, we can see our adopted Vietnamese female children running down the stairs (and rolling down the hallway in the case of our youngest son’s wheelchair with his comfort animal dog) to open Christmas presents on Christmas morning! Feliz Navidad! The Hernandez-Smith Family.

Since someone will not get the house in a multiple offer scenario, the unsuccessful buyers may feel like they were discriminated against illegally.

Duties to the Public

Article 10

REALTORS® shall not deny equal professional services to any person for reasons of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. REALTORS® shall not be parties to any plan or agreement to discriminate against a person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. (Amended 1/14)

REALTORS®, in their real estate employment practices, shall not discriminate against any person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. (Amended 1/14)

Some brokers have adopted another risk management strategy in multiple offers to shield the sellers from initially seeing the buyers’ names that may indicate a fair housing protected class (e.g., race, color, religion, sex, national origin) during the multiple offer consideration stage.

Example: using a spreadsheet with multiple offer terms without any buyer names. That way the sellers decide based on terms, not names.

Posted by: Byron King on 2/4/21 (This information is only accurate as of 2/4/21. You must contact SCR for updates and changes to this information after 2/4/21 as laws and regulations may change over time. SCR 803-772-5206 or email info at screaltors.org)