No-call rules
A broker instructed an agent to call a for sale by owner (FSBO) seller and not to worry about no-call rules. The agent understands, though, that real estate agents are supposed to be in compliance with the no-call list when engaging in cold calling. Can the agent ignore the no-call list and contact the FSBO seller?
The Federal Trade Commission (FTC) regulates interstate telephone solicitations and the national Do Not Call Registry. The Federal Communications Commission (FCC) regulates calls that are both intrastate, within the state, as well as interstate, or between states, including calls made within Wisconsin. Both the FTC and FCC regulations became effective in 2003. For REALTORS® and real estate licensees, this generally includes cold calling, calls to owners with cancelled or expired listings, calls to FSBOs, and calls to consumers referred by others. When placing these calls, agents should check whether the phone number is on the no-call list if an exception does not apply. These regulations apply to calls to a consumer’s residence or cell phone encouraging the purchase, rental or investment in property, goods or services regulated under federal law. A class action lawsuit was recently filed in California against a real estate firm, alleging the firm violated the no-call rules. The plaintiffs are seeing statutory damages of $500 per violating call, treble damages of $1,500 per call and injunctive relief. Failure to comply with no-call rules may put the agent and the firm at risk.
The National Association of REALTORS® (NAR) offers information about creating office policies to assure compliance with the no call rules at www.nar.realtor/legal/complying-with-federal-regulations/do-not-call-registry/creating-an-office-policy (NAR login required).
Contacting the FSBO seller
What limitations do REALTORS® have in regards to prospecting FSBO sellers as potential clients? What are the possible ways to contact a FSBO seller, and what limits are there for contacting a FSBO seller?
Depending on how the licensee reaches out to the seller, the law or the REALTOR® Code of Ethics may limit contact. The first recommendation is to check to see if the seller is in fact a FSBO seller. Some sellers may have an exclusive agency listing whereby the property is actually listed but the seller retains the right to market the property. If the property is listed, the broker, as a REALTOR®, may not solicit the client of another REALTOR® based on Article 16, which would apply if the seller has a limited service listing or an exclusive agency listing with another firm.
REALTOR® Code of Ethics Article 16
REALTORS® shall not engage in any practice or take any action inconsistent with exclusive representation or exclusive brokerage relationship agreements that other REALTORS® have with clients.
Solicitation ordinances
Can a broker go and knock on the door of a FSBO seller?
Before going to the home of a FSBO seller to “knock on the door,” the broker may review the local ordinances. In some municipalities, it may be illegal to attempt to sell a homeowner products or services at their residence.
United States Postal Service
A broker from another firm is currently trying to find a home for a buyer client. The broker placed a folded-up letter in multiple mailboxes stating he is looking for property for his buyer client. Is it illegal to put an item in mailboxes without going through the post office?
Using the mailbox to leave a written communication may only be done by mailing the communication with proper postage. It is a violation of postal regulations to use a mailbox to drop off mailers, advertisements or other communications without properly mailing. The USPS Domestic Mail Manual sets forth the rules for mail receptacles. The manual indicates that a mailbox should not be used for anything without postage, and doing so may be a federal offense and may incur a significant penalty for violating this law. See the following excerpt from the USPS manual, available at http://pe.usps.com/archive/html/dmmarchive0810/d041.htm:
3.1.3 Use for Mail
Except under 3.2.11, the receptacles described in 3.1.1 may be used only for matter bearing postage. Other than as permitted by 3.2.10, or 3.2.11, no part of a mail receptacle may be used to deliver any matter not bearing postage, including items or matter placed upon, supported by, attached to, hung from, or inserted into a mail receptacle. Any mailable matter not bearing postage and found as described above is subject to the same postage as would be paid if it were carried by mail.
8.3 Mailable Matter Without Postage in or on Mail Receptacles
8.3.1 Penalty
Whoever knowingly and willfully deposits any mailable matter (such as statements of account, circulars, sale bills, or other like matter) on which no postage is paid, in any letterbox established, approved, or accepted by the Postal Service for the receipt or delivery of mail matter on any route, with intent to avoid payment of lawful postage thereon, shall for each such offense be fined not more than $5,000.00 per individual or $10,000.00 per organization (18 USC 1725, 3571).
Emailing the seller
Can the broker email the seller?
The federal CAN-SPAM Act applies to all commercial emails, defined as “any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service.” These messages include emails that promote or sell a product or service for a fee, such as REALTOR® emails offering properties or brokerage services. CAN-SPAM requires all commercial emails to include a return email address and a valid physical postal address, a clear and conspicuous “opt-out” notice, a mechanism or active email address that the recipient may use to ask to not receive further email, a clear and conspicuous notice that the message is an advertisement or a solicitation, and clear notice in the subject heading if a message includes pornographic or sexual content.
Texting the seller
A broker found the phone number for a FSBO seller. Can the broker text the seller to try to get the listing?
The Telephone Consumer Protection Act (TCPA) regulates certain text messages. All text messages from autodialing equipment are covered by the TCPA. If you are using your personal cell phone to text, you need to obtain consent if the message is for telemarketing purposes. Messages made to solicit or encourage the purchase of or investment in property, goods or services would fall under telemarketing, and the broker would need to obtain prior written consent to text such messages. If the message is not telemarketing, then prior express consent would be required, not necessarily in writing. The burden will be on the broker to show consent has been obtained.
Learn more in NAR’s “window to the law” online video series about cold calling at www.nar.realtor/telemarketing-cold-calling.
Phone calls
As discussed previously, the no-call rules apply to a broker’s attempt to list a FSBO property.
Fax transmissions
Based in the 2005 Junk Fax Prevention Act (JFPA) and the 1991 TCPA, the FCC regulates unsolicited advertising faxes to consumers. There are four basic requirements included in the JFPA’s fax advertising policy. The sender must:
- Have an established business relationship with the recipient.
- Have voluntarily received the recipient’s fax number.
- Provide opt-out provisions for future unsolicited advertising faxes.
- Honor the recipient’s opt-out requests within 30 days.
Tracy Rucka is Director of Professional Standards and Practices for the WRA.
Resources
Federal resources
WRA resources