Best Practices for Real Estate Agents to Stay in Compliance
Real estate agents operate in a highly regulated industry, where compliance with local, state, and federal laws is paramount. In order to stay in compliance, real estate agents must adopt best practices that help them adhere to regulations and avoid potential legal issues.
In this blog post, we will discuss the best practices that real estate agents can follow to stay in compliance.
Stay up to date with local and state regulations
Real estate regulations vary from state to state, and even from locality to locality. As a real estate agent, it is your responsibility to stay informed about the latest changes in regulations that affect your business. Keep yourself up to date with local and state regulations by attending training sessions and seminars, and by keeping in touch with regulatory bodies.
Most states require a certain amount of continuing education credits each year. Don't just think of this as a nuisance you have to complete. Continuing education keeps you sharp at your craft and can keep you out of trouble!
Use a compliant deal management system
A compliant deal management system is crucial for ensuring that all aspects of your real estate transactions are in compliance with local, state, and federal regulations. Make sure that the system you use is designed specifically for real estate, and that it includes features such as esignatures, audit trails, and secure document storage.
Systems like Jointly go even further, using workflow intelligence to ensure you have all the proper documents and that they are filled out correctly from a compliance point of view.
Documenting every aspect of your real estate transactions is critical for ensuring compliance. Keep a record of every document you use, including contracts, addendums, and disclosures. You should also maintain a record of all communication with clients, including emails, phone calls, and text messages.
You could do all this manually, but it is tedious and easy to forget. If you adopt a system like Jointly, you won't have to do it manually.
Follow fair housing regulations
You may be thinking, "Well, duh, of course we have to follow fair housing regulations!"
But you would likely be surprised at how often these regulations are ignored. Sometimes it is ill-intentioned. Sometimes it is unintentional and simply out of ignorance or laziness. But regardless, it is illegal.
Real estate agents must adhere to fair housing regulations, which prohibit discrimination based on race, color, national origin, religion, sex, familial status, and disability. Make sure that your marketing materials and communications do not contain any discriminatory language, and that you are treating all clients fairly and equally.
Use proper disclosures
Disclosures are an important part of real estate transactions, as they provide buyers with important information about the property they are purchasing. Make sure that you are using proper disclosures, such as lead-based paint disclosures and seller property disclosures, and that you are providing them to buyers in a timely manner.
If you are using a system like Jointly, you know you will have both all the forms / disclosures you need, and that they are approved versions of those forms.
Work with a compliance expert
If you are a larger organization, you probably have some amount of processes and procedures designed to ensure compliance. Working with a compliance expert can help you verify that you are following all local, state, and federal regulations. A compliance expert can help you review your practices and identify areas where you may be at risk for non-compliance.
Wrapping it up
In conclusion, compliance is a critical aspect of the real estate industry, and real estate agents must adopt best practices that help them stay in compliance. By staying up to date with regulations, using compliant transaction management systems, documenting everything, following fair housing regulations, using proper disclosures, maintaining accurate records, and working with a compliance expert, real estate agents can ensure that they are meeting all regulatory requirements and avoiding potential legal issues.