Recently, the National Association of Realtors (NAR) introduced a significant settlement that changes how seller commissions can be disclosed on the Multiple Listing Service (MLS). Effective August 17th, there’s a strict prohibition on revealing seller commissions to buyers via the MLS. Additionally, starting August 12th, the Emerald Coast Association of Realtors (ECAR) will eliminate compensation fields from their MLS listings altogether.

In light of these changes, it becomes crucial for real estate professionals to explore alternative methods for communicating compensation details. Here are some effective strategies:

Text, Email, or Phone Call: Utilize these direct communication methods to inform interested parties about commission information for your listings.
Social Media and Website: Leverage your online presence to disclose compensation details. Your website can host a dropdown menu listing broker-to-broker compensations if they are a flat rate for all of your properties.
Postcards and Flyers: Use traditional marketing tools to disseminate compensation information.
QR Codes: Incorporate QR codes on property signs or flyers that interested parties can scan to access commission details.
Disclaimers: Include a disclaimer on your MLS listings prompting interested parties to contact your office directly for commission information. This approach will be well-understood within the industry.
Compensation Agreements: Four new compensation agreement forms have been introduced on Form Simplicity, each aimed at enhancing flexibility in compensation arrangements within real estate transactions. These new forms from serve as valuable tools for real estate professionals, facilitating transparent and legally compliant compensation arrangements.

Moving forward, we highly recommend ensuring that all compensation details are documented in writing to establish legal enforceability. Whether you communicate these details via direct channels like email, phone calls, or detailed disclaimers, it’s essential to formalize these agreements. For each listing, we advise having three critical documents: the property contract, the Buyer-Broker Agreement (BBA) with the buyer, and a comprehensive compensation agreement specifying the commission the seller intends to pay to the buyer’s broker. These documents collectively provide clarity and transparency in transactions, facilitating the accurate distribution of payments as required by your title company for settlement statements.

In conclusion, adapting to the new MLS regulations on commission disclosures requires real estate professionals to rethink how they communicate compensation details. By leveraging direct communication methods, online platforms, traditional marketing tools, QR codes, and formalized compensation agreements, agents can ensure transparency and compliance while effectively serving their clients.

Listen to our latest podcast episode to hear Dion and Ashley share more tips on communicating compensation outside of the MLS!