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REAL ETHICS by Steve Stazel | Aug
2005 | Index of all Real Ethics columns
To divulge or not to divulge… that is the question
Here is your ethics dilemma of the day. Please circle the proper answer.
In one day you receive offers on your listing from three different buyers, each working with a different broker. You should:
a. Tell all three brokers they are competing.
b. Tell all three brokers the offering price of the other offers.
c. Don’t disclose to any broker the existence of any of the other offers.
d. Your seller has already told you what to do.
Which answer did you choose? The correct answer is d.
Standard of Practice 1-15 states: “Realtors® in response to inquiries from buyers or cooperating brokers shall, with the sellers’ approval, divulge the existence of offers on the property.”
Notice the words “with the approval of the seller.” It is our obligation to ask the seller, when we take a listing, how he or she wants us to handle multiple offers. The seller may want you to tell competing brokers of the existence of other offers. The seller may feel this will result in higher offers. Or, he or she may say, “No, don’t tell. We put in an offer on a house three years ago and when the listing broker told us there was another offer on the property we withdrew our offer. I think potential buyers of our house would withdraw their offer, just as we did, if they knew they were competing. Don’t disclose.”
Isn’t this a decision the seller, not the agent, should make? The listing broker can certainly share with the seller the broker’s thoughts on what to do. However, it is the seller’s ultimate decision.
The Professional Standards committee of NAR has recently defined the word “existence” in this situation to include price, terms, and conditions.
Each month, the Aurora Association of REALTORSŪ Web site features Real Ethics,
a column by Steve Stazel devoted to explaining Code of
Ethics issues for members. A REALTORŪ since 1974, Stazel is a Professional Standards
instructor and senior Ethics
instructor for the Colorado Association of REALTORSŪ.
If you have an ethical concern or an issue you would like
to see addressed, please call Stazel at (303) 773-3333 or e-mail him at
stazels@msn.com. The comments of this article reflect the understanding and
opinions of the author and do not represent an official expression of policy by the National Association
of REALTORSŪ.
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