Real Estate Professionals. Please Read. Are we legal?

Real Estate Professionals. Please Read. Are we legal?

Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes

Recently my account was temporarily suspended for violating the forum rules because I had a link to the following disclosure, but I was only trying to reduce my liability and stay legal:
 

Arizona law regulates how real estate licensees can advertise through the department of real estate, and it would likely consider forums a form of advertising. (There are also some federal laws)

In its current version, the Bigger Pockets forums appear to cause Arizona licensees to be out of compliance with the law. (Other states may be similar)

  • The employing broker’s name must be included in all advertisements, including classified ads, real estate advertising guides, and other magazine ads. K. Michelle Lind/Commissioner Lowe 9-22-14
  • In advertising flyers, the employing broker’s name may be located on either the top or the bottom of the flyer however the employing broker’s name must be clearly legible.
  • On any other promotional material the employing broker’s name must be on the front page or front of the object.
  • The employing broker’s name must be visible on the front page of the website and each subsequent page of the website, without the necessity of scrolling down, regardless of the screen size of the computer.
  • When advertising real property on social media, such as Facebook, the name of the employing broker must be stated. When advertising real property in “thumbnails”, text messages, “tweets”, etc., where stating the name of the employing broker firm is not practical, the advertising information being linked to must include the name of the employing broker.
  • With team advertising it must be clear that the team is a part of the employing brokerage. For example, placing “The (Team Name) Team” at the top of the page in large letters with a much smaller brokerage symbol somewhere below is not sufficient.
  • The employing broker’s name must be spelled out in its entirety. For example, if an employing broker’s legal or dba name on a license includes “Southeast Valley,” that is what must appear in the ad; simply saying “SE” is not sufficient.
  • If the brokerage is an office of a franchise, the office must be identified; simply displaying the franchise name alone is not sufficient.

There is also the issue of liability. As real estate professionals, is it possible that we are creating unintended implied agency when we interact with people on this forum? Do we have liability if someone acts on one of our posts and is harmed? Bigger Pockets protects itself through the “Responsibility for User-Generated Content Posted on or Through this Site” under the “Terms of Use”, but make no protections for the user, and in fact, disallows it.

I have tried to contact bigger pockets about this, but have not received any reply. What are your thoughts? Have you checked the advertising laws with your department of real estate?

Thanks for any input.

0Reply
76 views

Most Popular Reply

Mindy JensenPro Member
BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
8y

This issue pops up from time to time in the forums. Our Rules state "V - No Advertising or Promotions Outside the BP Marketplace." We put these rules in place to keep our forums free from the clutter and spam that you see in so many other online forums. 

"Disclosure:  Licensed agent in AZ" is much different both in spirit and in disclosure than  "I'm a licensed agent in Arizona with Blah Blah Real Estate. If you need any assistance finding a property I can help you out. I am an investor-friendly agent and can set you up to receive listings via email. I work all over the valley. Contact me at (phone number) or (email address)."

I am also a licensed agent, and I think every state has disclosure laws that read fairly similar to your state's: "A licensee must ensure that all advertising identifies, in a clear and prominent manner, the employing broker's legal name or the dba name contained on the employing broker's license certificate." 

BiggerPockets has provided all of our members with a way to disclose this information in your profile. Create an Agent Profile by going to  https://www.biggerpockets.com/profile/agent-profile. 

Pro members can set up a Signature that will display this information on every post you write. (See Russell Brazil's signature as an example of both agency name as well as license numbers.)  A Pro membership costs $39 per month or $390 per year. I know of no place where you can "advertise" for free, and no other site where you can get such a targeted market for your advertisements for such a low price. 

I don't believe any of our members have been cited for not disclosing their employing broker's name in the forums. 

See this reply in the discussion

31 Replies

Jump to latestLatest
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    8y

    If you sign up for a Pro Account, your posts will feature a signature line which you can have your license number in, along with whatever else you may need to post to be compliant with the laws in your state.

  • Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes
    8y

    So I have to PAY to provide Bigger Pockets with FREE content? This still doesn't address the liability or agency issues.

  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    8y

    @Matt Shields 

    As @Russell Brazil said you could go Pro. Or you could go more anonymous (Matt S.) and not hold yourself out as a broker.

    Gimer Law516 Reviews
  • Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes
    8y

    Not disclosing that I'm a real estate professional is illegal in Arizona.

  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    8y
    Originally posted by @Matt Shields:

    Not disclosing that I'm a real estate professional is illegal in Arizona.

    I'd love to see the statute(s) you are reading.

    Do they make you wear a Realtor pin as well?

    Gimer Law516 Reviews
  • Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes
    8y

    Here you go:

    Directory and Summary of the ARIZONA REAL ESTATE RULES, Title 4, Chapter 28

    Arizona State Constitution

    P.S. No they don't make us wear any pins, but they do monitor the internet for advertising violations.

  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    8y
    Originally posted by @Matt Shields:

    Here you go:

    Directory and Summary of the ARIZONA REAL ESTATE RULES, Title 4, Chapter 28

    Arizona State Constitution

    P.S. No they don't make us wear any pins, but they do monitor the internet for advertising violations.

    I'll review what you sent but I do think you're missing the point.

    If you post on an internet forum as Matt S. you aren't advertising Arizona real estate or brokerage services.

    Gimer Law516 Reviews
  • Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    8y

    Interesting. It is my interpretation (Florida) that agents must disclose agency in advertising (buying, selling, seeking listings, etc). Simply having a post with info, opinions, etc may not be considered advertising. I am GLAD you brought this up. I see 100's of agent advertising, never stating their licensing status. Many of these are playing the assignment game, but that doesn't change their licensee status. Even if selling your own property, you are required to disclose. If purchasing for yourself, you are required to disclose. Last but not least: WHY would someone NOT disclose the licensing, which shows a higher education, standards, etc? 

  • Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes
    8y

    True, I could post as John Doe. I would still be illegal but the ADRE wouldn't know who I was, and I would have no liability to other forum users, but everyone posting unanimously would greatly reduce the networking and credibility of the forums. 

  • Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes
    8y
    Originally posted by @John Thedford:

    Interesting. It is my interpretation (Florida) that agents must disclose agency in advertising (buying, selling, seeking listings, etc). Simply having a post with info, opinions, etc may not be considered advertising. I am GLAD you brought this up. I see 100's of agent advertising, never stating their licensing status. Many of these are playing the assignment game, but that doesn't change their licensee status. Even if selling your own property, you are required to disclose. If purchasing for yourself, you are required to disclose. Last but not least: WHY would someone NOT disclose the licensing, which shows a higher education, standards, etc? 

    It may depend on the content of the post, but I can see the DRE claiming any posts are advertising. Their question might be "Why are you doing it if it's not advertising?" And then there is still the issue of liability and agency. 

  • Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    8y

    OK...we are waiting for the BP board attorney to give their opinion now that they have had a chance to review:
    @Tom Gimer

    free of course:)

  • Real Estate Broker · Manchester, NH · Member since 2014 · 630 posts · 420 votes
    8y

    @Matt Shields I think there's a line between "complying with the law" and "reading too far into the law".  While I don't have this issue regardless as my contact information is displayed in my signature, I think you're taking the definition too far.  Do all of your Facebook posts regardless of real estate relevancy have your broker's name, phone number, and disclose that you're a real estate agent in them?  Or is that information only contained in your profile?  

    There is clearly a portion of this forum designated for advertisements, posting services, properties, jobs, etc.  In that forum, its important to disclose that you're a real estate licensee.  In your profile, its important to disclose you're a real estate license.  In every single post do you really have to put your broker's name & number?  I think that's a step too far.  

    If you want to ere on the side of caution... you can always sign up for a PRO membership.  Its no different than paying for any other form of advertising... except this one has a pretty targeted audience!

  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    8y

    Relevant portions of R4-28-502:

    E. A salesperson or broker shall ensure that all advertising identifies in a clear and prominent manner the employing broker’s legal name or the dba name contained on the employing broker’s license certificate.

    G. The designated broker shall supervise all advertising, for real estate, cemetery, or membership camping brokerage services. 

    J. The provisions of subsections (E) and (G) do not apply to advertising that does not refer to specific property. [emphasis added]

    Gimer Law516 Reviews
  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    8y
    Agree, I think you are over reading this. I was a licensed agent so I’m familiar with the requirements. If you’re thinking this is BP’s responsibility to sort out, you’re off base. Each licensed agent needs to know what they can and can’t do. Why don’t you just ask your RE commission, or state Resltors assocsiation....they have hotlines for this.
  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    8y
    Originally posted by @John Thedford:

    OK...we are waiting for the BP board attorney to give their opinion now that they have had a chance to review:
    @Tom Gimer

    free of course:)

    Unless he's talking about a specific listing or to a potential client about their property... non-issue. 

    Gimer Law516 Reviews
  • Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
    8y

    I agree in making sure you stay legal. This is important as a licensee. I agree with @Wayne Brooks that you are reading more into this than what exists. If you are posting info, opinions, etc and not representing a buyer, seller, or soliciting for business then I don't think there is an issue. 

  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    8y
    Originally posted by @Matt Shields:
    Originally posted by @John Thedford:

    Interesting. It is my interpretation (Florida) that agents must disclose agency in advertising (buying, selling, seeking listings, etc). Simply having a post with info, opinions, etc may not be considered advertising. I am GLAD you brought this up. I see 100's of agent advertising, never stating their licensing status. Many of these are playing the assignment game, but that doesn't change their licensee status. Even if selling your own property, you are required to disclose. If purchasing for yourself, you are required to disclose. Last but not least: WHY would someone NOT disclose the licensing, which shows a higher education, standards, etc? 

    It may depend on the content of the post, but I can see the DRE claiming any posts are advertising. Their question might be "Why are you doing it if it's not advertising?" And then there is still the issue of liability and agency. 

    Although any post on BP could technically be considered advertising (see R4-28-502(L)) there is a specific exemption from the requirement that every "ad" from a licensee be associated with the brokerage. 

    As far as liability... how do you establish an agency relationship in AZ? I assume it's through a written agreement. 

    Gimer Law516 Reviews
  • Mindy JensenPro Member
    BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
    8y

    This issue pops up from time to time in the forums. Our Rules state "V - No Advertising or Promotions Outside the BP Marketplace." We put these rules in place to keep our forums free from the clutter and spam that you see in so many other online forums. 

    "Disclosure:  Licensed agent in AZ" is much different both in spirit and in disclosure than  "I'm a licensed agent in Arizona with Blah Blah Real Estate. If you need any assistance finding a property I can help you out. I am an investor-friendly agent and can set you up to receive listings via email. I work all over the valley. Contact me at (phone number) or (email address)."

    I am also a licensed agent, and I think every state has disclosure laws that read fairly similar to your state's: "A licensee must ensure that all advertising identifies, in a clear and prominent manner, the employing broker's legal name or the dba name contained on the employing broker's license certificate." 

    BiggerPockets has provided all of our members with a way to disclose this information in your profile. Create an Agent Profile by going to  https://www.biggerpockets.com/profile/agent-profile. 

    Pro members can set up a Signature that will display this information on every post you write. (See Russell Brazil's signature as an example of both agency name as well as license numbers.)  A Pro membership costs $39 per month or $390 per year. I know of no place where you can "advertise" for free, and no other site where you can get such a targeted market for your advertisements for such a low price. 

    I don't believe any of our members have been cited for not disclosing their employing broker's name in the forums. 

  • Mike CumbieBusiness Member
    REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes
    8y

    @Matt Shields,

    I have looked extensively through my states requirements and came to the conclusion that I needed to create an agent account on BP to remain compliant on this site specifically. I created my account before becoming a PRO member and long before becoming a Moderator. The agent account allows..... requires you.... to put in your license information as well as your brokerage. If I am not mistaken it is still free to setup.

    However if you feel that you do not want to take the time to create it or that it is still not compliant with your states laws, I would recommend to not post further. There is no offering of advice that is worth putting your license at risk over in my opinion. If I received a notice from the Department of State that they believed I was in violation I would delete my account in about 30 seconds. 

    The other point to consider is not to post as an agent. I know in my state we have to disclose during the "first substantive contact". Replying on the type of paint to use, suggestions for curb appeal, when to evict, how to calculate NOI are not substantive to a specific real estate transaction. Now if someone said "lets discuss 123 Main street" that I happen to have listed...... well that is different. Someone asking questions about a hypothetical house or some hypothetical situation 2,500 miles from anywhere I am licensed, I would argue there is no substance involved.

    Just my 2 cents and good luck with your investing and business!

  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    8y
    Originally posted by @Mindy Jensen:

    Pro members can set up a Signature that will display this information on every post you write. (See Russell Brazil's signature as an example of both agency name as well as license numbers.)  A Pro membership costs $39 per month or $390 per year. I know of no place where you can "advertise" for free, and no other site where you can get such a targeted market for your advertisements for such a low price. 

    Without a doubt, the ability to have the signature line in the forums is by far the best form of advertising I have.  70% of all traffic to my website links through BP.  I am going to end up with about $150k in gross commissions just from the BP portion of my business, easily being the top avenue from which my business comes.  That $390 combined with activity in the forums is perhaps the best investment an agent can make in their business.

  • Brie SchmidtBusiness Member
    Moderator
    Real Estate Broker · Chicago, IL · Member since 2013 · 6k+ posts · 5k+ votes
    8y
    Originally posted by @Matt Shields:

    So I have to PAY to provide Bigger Pockets with FREE content? This still doesn't address the liability or agency issues.

    If you think you have to pay BP to provide them with free content, you are definitely doing it wrong.  Any agent on here knows that they get back 10 fold of what they pay/contribute on here

  • Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes
    8y

    From the Arizona Department of Real Estate

    Thank you for contacting the Department of Real Estate.

    Per the Commissioner's Rules, the use of an electronic medium such as the Internet and website technology that targets residents of this state with the offering of a property interest or real estate brokerage services pertaining to property located in this state constitutes the dissemination of advertising. The Department's rules on advertising; therefore, apply.

    Well, they didn't give me a straight answer if all forum posts are advertising, but it seems that is their position. So it looks like a pro account is required for at least Arizona agents. 

    That still leaves the liability and agency issues. Some people here have pointed out that agency cannot exist unless there is an expressed agreement, but agency can also be created through the parties actions. An agent can accidentally create agency just through casual conversation, called "implied agency", if the agent is providing advice or guidance normally found in agency. If agents on Bigger Pockets are not familiar with implied agency it is important that they learn about it. Implied agency through conversation can be difficult to prove, but here it is in black and white and eventually someone will be on the wrong end of a lawsuit or department of real estate investigation. I see possible agency being created every day on the BP forums, and I really feel that there should be a disclosure users must acknowledge to participate. 

  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    8y

    @Matt Shields Matt, you ignored my post about the regs you've been citing. Yes, BP is likely advertising but unless you are posting listings or soliciting business in the Marketplace the "Department's rules on advertising" specifically provide an exemption for communications which do not relate to specific property.

    With respect to implied agency -- since you see "possible agency being created every day" on the BP forums, please produce a single communication example that could even arguably result in a fiduciary relationship being established. From what I've seen, the rest of this large community seems comfortable exchanging ideas and information without believing they've somehow engaged another person to act on their behalf.

    Gimer Law516 Reviews
  • Mike CumbieBusiness Member
    REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes
    8y

    DISCLAIMER: The following information is in no way legal advice. React to any advice at your own risk secure in the knowledge that they are just the mindless ramblings of some dolt on the internet.

    As far as "Implied agency". I "suppose" that could be the case. Although if so Zillow, Trulia, REALTOR and all the other sites have question places, where agents respond. They would all be guilty as well. Any advertisement where someone sent out a post card that said "Now is the time to sell" could be called into question. TV advertising where Fred the agent says "I'm here to find you the best deal" could "imply" agency. Whenever you are sitting in an office or Open House and a couple comes in and says "We are not ready to buy yet, but should we repair our fence or sell as is when we are"? Any response is implied so I assume you would have them fill out a disclosure before answering?  When someone says "Hows the market"? anything more than a mute bobblehead is suspect.

    In my area the DOS sends a cease and desist before just pulling your license for things that are not intentional. If I receive one I will react accordingly.

  • Broker · Phoenix, AZ · Member since 2015 · 351 posts · 273 votes
    8y
    Originally posted by @Tom Gimer:

    Relevant portions of R4-28-502:

    E. A salesperson or broker shall ensure that all advertising identifies in a clear and prominent manner the employing broker’s legal name or the dba name contained on the employing broker’s license certificate.

    G. The designated broker shall supervise all advertising, for real estate, cemetery, or membership camping brokerage services. 

    J. The provisions of subsections (E) and (G) do not apply to advertising that does not refer to specific property. [emphasis added]

     Yes, but this section goes on to specifically address the internet and brokerage services offered. The question is if it's advertising? We are real estate professionals interacting with customers on a public real estate website, and many here have spoken about how much BP has increased their sales. I would not want to defend it in an investigation.

    Arizona Administrative Code:

    L. The use of an electronic medium, such as the Internet or web site technology, that targets residents of this state with the offering of a property interest or real estate brokerage services pertaining to property located in this state constitutes the dissemination of advertising as defined in A.R.S. § 32-2101(2).

Join the conversationCreate a free account to reply, vote on answers and follow this thread.