NAR Settlement

REcolorado is still owned by DMAR and SMDRA and will continue in operating as such until a sale is finalized. We chose to opt-in to the NAR Settlement, which obligates us to comply with the settlement terms including system changes. We made this decision because we believe the changes will serve the best interest of the MLS and our subscribers, whether we are association- or privately-owned. The opt-in provides financial protection and liability release from the Sitzer and Moehrl lawsuits, while allowing REcolorado to continue to make market-specific policies.

This settlement is not the end. The DOJ investigation and additional lawsuits are still very present in our industry. The changes identified in the settlement, including removing compensation from the MLS, helps to protect REcolorado from the threat of future lawsuits and investigations.

Key aspects of the settlement include:

• Sellers may offer buyer concession on an MLS (e.g. closing costs) so long as such concessions are not limited to or conditioned on the retention of or payment to a cooperating broker, buyer broker, or other buyer representative.
• A new rule will be put in place by NAR that prohibits offers of compensation on the MLS. Offers of compensation will no longer be permitted in any area of the MLS, which includes fields, written remarks, etc. Because this information is no longer collected, it will not be available in data feeds that are used by technology providers or portals.
• The NAR settlement stipulates that a written agreement needs to be in place with a buyer before the buyer tours any property, unless inconsistent with state or federal law or regulation. The agreement must disclose the amount or rate of compensation. This amount may not be open-ended. For example, it can’t indicate “…whatever the listing broker is offering.” 
• A disclosure must be presented to buyers and sellers that indicates broker commissions are not set by law and are fully negotiable.

REcolorado will make appropriate changes to our policies and systems in early August. We will provide advanced communication to all subscribers. Compensation fields and data will be removed on August 6, 2024.

REcolorado provides access and the same level of service to licensees and Realtors. System and Policy changes will be put in place for all REcolorado subscribers no matter the business model they operate. All REcolorado subscribers, regardless of REALTOR® affiliation, are required to comply with all MLS policy.

Yes. Offers of compensation can be pursued through negotiation and consultation with consumers and real estate professionals. Additionally, sellers can offer buyer concessions (concessions for buyer closing costs, for example). Compensation will continue to be negotiable and should always be negotiated between agents and the consumers they serve.

The VA has temporarily lifted its ban on buyers directly paying for professional real estate representation until the agency deems it necessary to engage in a formal rulemaking process. The VA’s home loan guaranty is the only loan program with this explicit prohibition. Lifting the ban has signaled that veterans can still seek professional representation and access VA loans.

No, seller contributions of money to pay for buyer’s agent fees are not considered IPC and will not be considered in IPC limits for conventional mortgages.  Fannie Mae defines Interested party contributions (IPCs) as “costs that are normally the responsibility of the property purchaser that are paid directly or indirectly by someone else who has a financial interest in, or can influence the terms and the sale or transfer of, the subject property.” Compensation paid to the buyer for the buyer agent fees falls outside the IPC amount. Speak with your mortgage lender for specific questions and situations.

According to Colorado’s Department of Regulatory Agencies, the written agreement requirement is inconsistent with state law. REcolorado will not require nor enforce written buyer agreements for our subscribers.

REcolorado takes a proactive, transparent, subscriber-focused approach to operating our business. As we monitored the lawsuits, this approach led us to strengthen our business-friendly, market-driven policies by removing the compensation requirement. As a result, REcolorado users will not see major changes as they use the MLS. As more details and clarity become available, we will continue to engage with our stakeholders, including brokers, agents, and partners, as we consider additional changes that are specific to our market.  We will also continue our long-standing tradition of providing the MLS perspective to the state licensing authority to promote consumer-friendly policies and practices.  

The REcolorado MLS does not require cooperative compensation. The value provided by REcolorado MLS is much greater than the offer of compensation. Our customers, consumers, and the industry rely on the MLS for accurate and fair access to all residential inventory, which facilitates cooperation among agents. That same inventory powers the tools, services, and insights that are used to facilitate the home buying and selling process. It also provides immense value to appraisers as they use comprehensive, accurate data to ensure timely and accurate valuations. The settlement strengthens the value a buyer’s agent brings to a real estate transaction and reinforces it in the buyer representation agreement. The MLS will continue to champion a transparent and efficient marketplace, giving all consumers equal and fair access. 

We have always viewed change as an opportunity to innovate. We’ve seen many industry shifts in our 40 years as an MLS and have used each to strengthen our commitment to being your MLS partner and grow stronger. The benefits you receive from REcolorado are rooted in our ecosystem of rich property data and modern services. You can count on REcolorado to be by your side as you manage your business from lead to close and beyond.