From: Jay Reifert [true-agents@true-agent.com] Sent: Saturday, February 09, 2002 11:03 PM To: Oppose the WRA--Defeat Designated Agency Cc: Attorney General James Doyle (Re: Anti-Trust); FTC Anti-Trust Division; William A. Black; Assistant Attorney General Subject: SPECIAL BULLETIN: Smoking Gun 1, A Consumer Speaks Out [Format Change: From this message forward, the header detailing to whom these messages are being sent will appear at the bottom of the message and the message will begin with a short summary to allow you to more easily determine your level of interest in the current subject, with full details of the issue appearing directly beneath the summary. My sincere thanks to those of you who have made these valuable suggestions for making this a more reader-friendly service.] ----------------------------------------------------------------------- List Removal Instructions: Reply to this Message With "Remove" in the Subject Line or Body of the Message. Governmental Officials and Their Respective Staffs Will Not Be Removed From This List. ---------------------------------------------------------------------- SPECIAL BULLETIN: Smoking Gun 1, A Consumer Speaks Out ---------------------------------------------------------------------- What you are about to see, is a signed letter that I just received from a concerned citizen in Middleton, Wisconsin. Prior to this February, I did not know this person...or know of this person. Her true story was provided to me in order to help clarify what can frequently happen in the world of real estate SALES. Though it is her own, it is not very different from the stories I have been hearing from many other consumers over the past thirteen years. As you read her story, keep in mind that nobody--myself included--is saying that real estate people should not be allowed to be salespeople. What those of us who care are saying, is that you should not allow a salesperson to call his or herself an AGENT, unless they are willing to embrace the higher standards that come with such a role. Designated Agency, if approved, will give people like the licensee in this story free reign to engage in dealmaking, while falling back on the claim of having represented someone, or making claims that she was only trying to be fair to all parties. Look at it this way, if you--as a person--were to be SUED by someone who had a grievance, real or imagined, against you, would you hire an attorney from the same firm to watch out for your best interests in that suit? Or, if you were getting divorced from your spouse would you allow the same attorney...or even an attorney from the same firm, to represent your best interests against your soon to be former spouse? That's really what we're talking about here. One firm, purporting to represent two parties with opposing interests in the same transaction. The only parties who stand to benefit in that situation are the licensees involved and morever, the firm that will collect a fee on the buyer side and the seller side of the deal. (This is NOT collecting TWICE from each party, as misleadingly stated by WRA General Counsel Rick Staff in another correspondence. In each transaction there is a seller side fee, often three percent and a buyer side fee, also often three percent, which adds up to the oftenly charged fee of six percent overall.) One final note before the letter. The licensee who is the main party in the true story you're about to read is someone I have known for almost thirteen years. She is a nice person. I like her as a person. She is also not very different from many of the licensees that I have met over the course of these many years. She probably cannot even see that what she is doing, is wrong. That's because she is a salesperson...and not an agent. Nothing wrong with that, other than the fact that she should not be allowed to hold herself out as an agent, unless she is willing to subscribe to the mandate of agency, which is putting the interests of the client ahead of all others, including her own. JR -------------------------------------------------------------------- My Recent Experience with Real Estate Agents in Wisconsin February 9, 2002 In the last 5 months, I have been looking for a home or a lot to purchase, as my family considers a move to a new location within the area. During this time, I have enlisted the help of three different licensees, at different times, with little success. The last licensee I worked with nearly soured me on the whole experience. Several things this licensee said or did, made me question whether she was working for me or I was working for her! During the first meeting with this person, we saw several properties based on listings that I had found via the Multiple Listing Service (MLS). However, from the beginning she said that I didn’t need to look at the MLS or send her listings I found since she doesn’t regularly check her email, and could find properties much sooner, as she often knows about properties before they go on the market. When I asked her if we could look at these “pre-listed properties” or drive by them, she said that was not possible. I had the immediate feeling that she was using these potential listings as bait in order to keep me as a customer. Since she apparently could/would do no more than any other licensee I have previously met, I also mentioned that if I decided to purchase a home that she is listing, I would go with a different licensee to avoid conflict of interest issues. She said that all a buyer's agent can do is interpret for me--whatever that meant--and that under the law she is obligated to be fair to all parties. When I was adamant about wanting my own representative, she said that she could refer me to another licensee within her firm. -------brief commentary from JR When the licensee said "refer" what she did not say--and was almost certainly true--was that the licensee would charge her officemate a fifty to seventy-five percent referral fee on the buyer's side fee for letting the officemate "represent" this buyer. In all likelihood, this arrangement would never have been disclosed to RL. -------end commentary from JR Another problem I experienced is that she rarely called me on the phone, except to return my calls. She often insisted that, “nothing had come up,” until I told her what I had found on the MLS. Sometimes, when I informed her of several new listings I was interested in seeing, she would say that she had seen them too, and wanted to talk to me about them. Once, when I left a message about wanting to see a particular listing, she called back saying she had already set up an appointment for that house. What a coincidence! Later, during our second meeting, she introduced me to a builder who had an office in her building. When I asked for pricing information, she interrupted to say, “Oh it’s in your price range”. She didn’t let the builder answer and she didn’t tell me that if I did go with this builder, she would collect a nice commission from him (adding to the final costs of the house). During our third and last meeting, we went to see three listings. One listing was a home I had found on the MLS, one was a listing that this licensee had just listed under her name, and one listing was two hundred thousand dollars over my price range. When I questioned her on the choice of that house, she said that SHE really wanted to get in to see it. When I admired the wooded lot behind the house, she said that if I wanted the house, I would need to sign with her as my buyer’s agent to negotiate the price down. She followed up with that by suggesting that I would need to get my house on the market soon, and she could help me with that, too! That was the last straw! This licensee was showing me listings she was listing, asking me to sign with her as a buyer’s agent, and wanting to list my house as a seller’s agent almost in the same breath. I not only felt pressured, but felt there was a serious conflict of interest in many of the courses of action to which she was seeking to expose me. My next step was to follow the suggestion of a great book, entitled, “Your New House”, by Alan and Denise Fields, by seeking out an Exclusive Buyer Agent. Since exclusive buyer agents only work for the buyer (they do not have seller listings), there is little possibility of conflict of interest and the buyer gets sincere representation. There was only one last conversation I had with this licensee. When I broke off my professional relationship with her (though no contracts had ever been signed), she warned me that if I purchased any house I had seen with her, I would owe her the buyer’s side commission under something she called “procurement.” It is my feeling, as this is something that would effectively take from me my right to decide for myself what type of agent I wanted to have, that "procurement" should be disclosed to an affected party at the first meeting. By telling me of "procurement"after exposing me to the property, she completely destroyed my ability to trust her. Ever the salesperson, before we ended that conversation she suggested that she could still represent me as a seller’s agent when I put my home on the market, and furthermore, if I chose one of her listings she would help me and my buyer's agent negotiate a better deal with her sellers since she knows me. After hearing that I decided then and there never to consider her for a seller’s agent or anything else. It's a shame that more buyers and sellers don't know of the unscrupulous practices that can go on in the conflicted world of the seller/buyer real estate agent. It's an even greater shame that so many licensees can't see for themselves, how what they are saying, and doing, makes them appear as nothing more than salespeople who'll do anything to make a quick buck. If Designated Agency is going to make it even harder to hold a licensee accountable, when they are already prone to engaging in wholesale deal-making, I don't know how any intelligent consumer could support such a plan. I certainly don't. Sincerely, RL Middleton, Wisconsin --------------------------------------------------signature on file Commentary Again, while I like the person--as a person--who is the object of RL's displeasure, I do not, at all, like how she attempts to hold herself out as any buyer or seller's agent/representative. She's not. What's worse, she has taken organized real estate's second biggest secret...topped only by the deceptiveness of our agency laws in Wisconsin and has attempted to use it against RL...the concept which this licensee misidentified as "procurement". The correct name for this concept is "Procuring Cause" and--now that buyers have the right to choose their own representation...it is pure EVIL. Under procuring cause, a licensee who has accompanied a buyer to a property or otherwise "caused" that buyer to purchase a particular property, may be entitled to receive the compensation that would ordinarily flow to the buyer agent of the buyer's choice...ALL WITHOUT EVER TELLING THE BUYER THAT SUCH A CONCEPT AS PROCURING CAUSE EXISTED! For instance, in RL's case, the licensee in question never told RL that by seeing a home with her that RL could be giving up her right to choose her own buyer agent later, until long AFTER RL had already seen the home with her...making it too late for RL to decline seeing the home with her. (You see, RL told the licensee that she was going to seek her own buyer's agent to pursue the home in question...and that's when the licensee told RL about Procuring Cause.) It's also important to note that RL was working with this licensee as a customer...meaning that the licensee worked for the seller, not RL. Furthermore, the licensee did not ever "mirandize" RL by providing her with the State of Wisconsin MANDATED Disclosure of Real Estate Agency form, nor did she ask RL and her husband to initial the form, also as required. Everything that this licensee did, was geared toward protecting the licensee's interest, without ever giving RL the information necessary to protect herself from the licensee! Procuring Cause is such a well kept secret, that most consumers would never believe, until they had been robbed of their ability to choose a buyer's agent of their own, that it could possibly exist. But, procuring cause and its anti-competitive, illegal effects are a scandal for another day. The bottom line in this case is, Designated Agency is bad for consumers and allows--whether innocently or by design--licensees to use the law as a shield to protect their own self interests. (Note to all you news gathering organizations on this list: I have been giving you insights into practices which are the business world equivalents of such events as Enron...the Savings and Loan Scandal of the 80's and just about any other scandal you may wish to name. Other than a few of you here and there who have given some press to this issue, I have to ask myself, WHERE ARE YOU? Please feel free to quote me, in context, at your desire. If you need to establish context...give me a call. You do not do the consumers of Wisconsin any favors by remaining silent on these issues. If you think you are protecting me by not printing what I say...DON'T PROTECT ME! I want the WRA to do something stupid, so that this issue, if not solved in the here and now, will be taken up by the courts and solved there. I have the truth, both legal and otherwise, on my side.) ------------------------------------------------------------------- Please, contact your legislators to voice your opposition to Designated Agency. You can find out how to contact your legislator to register your oppostion to Designated Agency by going to: http://www.legis.state.wi.us/wamltest/ -------------------------------------------------------------------- Also, PLEASE forward this message to everyone you can and please also print it out--and distribute--to those who you know that don't have email capabilities.] --------------------------------------------------------------------- [This message is going out to thousands of Wisconsin Realtors, almost 500 governmental officials--including all State Legislators and their respective staffs, the Governor of Wisconsin and most candidates for Governor of Wisconsin, the Attorney General of Wisconsin, over 425 Consumer Advocacy Groups and/or individual Consumer Advocates, over 285 Registered Wisconsin Lobbyists and over 190 Media Outlets.] -- Sincerely Yours, Jay Reifert, Broker/Owner*****************Excel-Exclusive Buyer Agency 100% Homebuyer Representation********5136 E. Hilltop Road 100% Of The Time****************************Madison, Wisconsin 53711 South Central Wisconsin's ONLY********(800)928-9379, Toll Free Full-Time Exclusive Buyer Agency Firm.***(608)273-8841, Office Visit http://www.true-agent.com ***********(608)273-8388, Fax Machine or mailto:true-agents@true-agent.com Check out our NEW website, at: http://www.Buy-Madison-Real-Estate.com