Home : Blogs : Celeste "SALLY" Cheeseman HAWAII Relocations & Real Estate : ALOHA! Hawaii Real Estate and Relocations Blog

"Professionals" Who Step OVER the Line & Into Liability Issues

We all have heard incidences, not coincidences but INCIDENCES where a professional in the Real Estate Industry really steps over the line. Or...a professional who may not be in the industry directly ...but indirectly.... who steps over that line to the point they could be in serious trouble with liabilty cases smacked right on their behinds at the blink of an eye.

For instance:

The Real Estate Agent who plays home inspector, or contractor or loan officer all in one and gives advice that is totally wrong. Please stick to what you are trained for UNLESS you have a license for all! Even then, if you have a license for all of that then I beg to differ when you say it isn't a conflict of interest.
The Loan Officer who plays Realtor® and tells the client how their Realtor® should write their contract. Please stick to what you are trained for UNLESS you have a license! Again, conflict of interest.
The Mold Inspector who writes a report for a tenant and inserts the Landlord Tenant code so the tenant can get new air conditioning units. Please stick to what you are trained for....UNLESS you are licensed and a certified inspector AND a Property Manager too. Conflict of interest.
The Home Inspector who plays electrical contractor and blows out of the proportion that GFCI outlets are not an electrical problem but a suggestion to .... update. Please stick to what you are trained for and if you don't have a license for being an electrician don't scare the buyer into thinking there are huge problems. Hmmm. ......
The 'friend' who plays plumber (for a home inspection and tells the buyer that the running toilet is cause for backing out of a contract. Please stick to being an aquaintance and not a friend because you just talked your 'friend' out a home they really loved.
The mother or father who plays Realtor® because they bought a house in the past and suggests that they don't need their own Buyer's agent because they'll get a better deal through the seller's agent. Please stick to being a parent and not a Realtor® when you did not get the representation you needed and now have structural issues in your own home.
The advertising EXPERT in whatever field. Make sure you really know what you're talking about if you advertise that you do.

Bottom line, we all like to be 'helpful' but it could cost you your license, your reputation and your business for giving information that you are not qualified to give. Refer the 'client' to a professional and make sure that "professional" is licensed or knowledgable in the advice they give. Be aware of the professional who is out to give all kinds of information (the know it all) ....there will definitely be an ulterior motive.

I love my license....how about you?

~~~~~~~~~~~~~~~~~~

Celeste "Sally" Cheeseman is a Realtor-Associate with Century 21 Liberty Homes in Mililani, Hawaii. With a sharp understanding that a listening ear is the key to a client's needs she serves the island of Oahu (Honolulu County) and all Hawaii Military Relocating to Hawaii, Hawaii Retirees, Hawaii Job Transfers and Hawaii Residents. Website: www.hawaiihomesmarket.com

Posted by Celeste "SALLY" Cheeseman HAWAII Relocations & Real Estate on 01/26/2009 11:42 PM

Comments (80)

Liability in the ActiveRain Channel

ethics, realtor code of ethics, hawaii va home loans

Originally posted at: Hawaii Real Estate & Relocations : "Professionals" Who Step OVER the Line & Into Liability Issues

Post is included in group: Realtors®
Post is included in group: POSITIVE ATTITUDE for the Weary Soul
Post is included in group: ETHICS and the REALTOR
Post is included in group: Diary of a Realtor
Post is included in group: Club Chaos

80 Comments on "Professionals" Who Step OVER the Line & Into Liability Issues

JAN

Sally - We have all ran across these so-call experts. As Realtors we better keep in mind what our territory is, and when necessary have other competent professionals address other subject matters.

Sally... this is so excellent information and at such a perfect time. I am actually reading more misinformation from those that are both loan officers and realtors... or have been attacked by loan officers that are both, telling me that I am a liar or don't know what I am doing. Yet when I question them or ask them specifics, they never come back to answer the questions... sad... And those family members that think they know it all... and give bad advice to their fsamily members... rut row ...thanks for posting this.

jeff belonger

Jennifer: I'm so weary of 'hearing' the instances where one takes matters into their hands that are not capable. It costs the buyer a home, a seller a sale, heartbreaking circumstances and needless liability suits following.

JAN

Sally, another excellent post. Thanks for sharing your insight into how many professionals cross over the line.

Jeff: If it's one thing that I do know..is that your information has helped me tremendously to learn more about FHA loans and other programs. I would still refer my clients to ask questions of 'their' loan officer. That's what they're there for...same for other professionals. Give their professional advise for what they are the expert in...not trying to play the whole field. grrrrr.

Vickie: Thanks but it's a given in all industries....stepping over the line...stepping on others feet. It's up to us to keep our industry alive with quality service, advise and performance.

Hi Sally, I am a licensed attorney as well as a Realtor and Broker, so I feel pretty comfortable about knowing where some of the ines are, and you are right that those who cross the line are not only often committing ethics violations, but they may be setting themselves up for a lawsuit. And they may be hurting the very people they think they are helping.

What disturbs me is when I hear agents spouting the law - especially when they cite laws that don't exist and give clients legal advice that isn't legal at all. It is mighty dangerous to practice law unless you are licensed to do so. Every real estate agent should remember that, and if they wonder if something is over the line, is probably is.

Very nice post, Sally! So am I to assume by your article that you are an expert "fraud spotter"? ;-)

Randy Hooker

Bottom line, we all like to be 'helpful' but it could cost you your license, your reputation and your business for giving information that you are not qualified to give. Refer the 'client' to a professional and make sure that "professional" is licensed or knowledgable in the advice they give. Be aware of the professional who is out to give all kinds of information (the know it all) ....there will definitely be an ulterior motive.

I love my license....how about you?

This should be included under our signatures on all emails to other professionals.

Great job.

Good points once again. It seems like we could write these over and over and still not everyone would get the message. Wouldn't it be nice if everyone actually respected their license :) Ok, so where are you standing...in front of your new listing? Sweet :)

Sally -

Geez, I thought this kind of stuff only happened in Chicago - I feel comfort in the fact I am not alone.

Real estate is a funny business. Every common man and lady thinks they intuitively know all about the business, and how it works. Often, when a Realtor steps over the line and overstates, it speaks poorly to the entire profession.

Now, in deference to your attorney commenter, I have encountered more than a few lawyers that want to practice Real Estate Selling. And several inspectors who feel they will earn brownie points by suggesting "renegotiation."

But in no way should we Real Estate Practitioners be sucked in to counseling irresponsibly!

You know, I really wish I was in HI now - it is DAMN COLD here in Chicago!

Enjoy Paradise!

DEAN & DEAN'S TEAM CHICAGO

Susan: I so cringe hearing some of the things I hear...the most recent was the mold inspector....not even licensed for anything. Agreed. But how about the other 'professional' that are not licensed for anything at all? I truly believe that in our industry every person who is involved should be a licensed somebody. :)

Hi Sally!
Excellent post...and I couldn't agree more. Especially the "all-in-one" real estate professional who says they can do it all. Maybe they can, but they can't do it all well. There's the rub!

Randy: Fraud? I beg to differ on the language here. When one crosses the line with their profession into another...that brings up some issues for all....

Denise: I love when people take the quotes they like .... it adds acknowledgement that they must agree :) Thanks.

Kathy: Guess who I dragged out there lol! Gary helped me with the sign and took some extra pictures. Can you believe after all these years I still hate to put up those LARGE signs. (a complex going on after I had a sellers friend laughing at me....and still didn't bother to help ....geez)

Great post, Sally. All too often I see people stepping just a speck over the line... their intentions might be innocent enough, but it's best to just not go there at all.

Aloha, Sally... The use of the word 'fraud' was just my exaggerated and demented way of trying to say that when so-called experts cross the lines and start volunteering their expertise in areas in which they are not qualified or licensed, IMHO, it borders on fraud. And I apologize if in my attempt to bring a little levity into a very serious issue, I offended you. You did an excellent job with a very delicate problem. Mahalo!

Randy Hooker

Hi Sally, all excellent points. Honesty is exciting enough, no additional drama needed.

Paula: True ...true... I'm a good cook too ....not..lol!

Jesse: And that's a fact. Just don't go there to begin with. I have no shame telling someone I'm not the professional in an area I'm not. Ask me about real estate and I have the gift of gab. Okay, maybe just a gabber LOL.

Randy: Not so much offended as wondering where a harsh word like that came from....not to worry...everyone has a different way of expressing themselves. :)

Jim: I like that...honesty is pretty exciting for me...allows me to sleep oh so well at night...which is what I'm going to do now...long day...relax....and night night :)

wow, look at all these posts. It seems many people have come across this issue. It seems that on every issue you raised, you must have had a personal experience. :0) Another issue is dual representation. Yes its legal, at least in Oregon, but in my thinking there is no way an agent can represent both buyers and sellers without favoring one over the other.

Great points and reminder to all of us. Part of the challenge is that the general public thinks we know everything. We get asked all kinds of questions.

Actually, I would like to respond to Doug's thinking...our office does do dual representation..fairly and successfully. I think that you just have to be hyper-aware of the process. Most of our agents in multiple offer situations don't open the other offer/s until they are in front of the seller, to avoid any possibility of being accused of bad behavior. They also give their buyers all of the comps and let them decide what price they want to offer. The costs are very traditional here, so they are fairly static for either side. We are very open in explaining to both parties what is happening. If our clients are more comfortable, management will write the offer for the listing agent. It can be done very ethically and successfully...the agent just has to be on top of everything!

Sally it is never worth the risk to save someone a few dollars. I for one will not be putting my license on the line for any reason. Take care and happy blogging!

Excellent! I agree-be the source of the source no thte source itself! Liability risks are too high to step outside your licensed area of expertise. Stick with what you know and you will do fine.

Being a jack of all trades never does anyone any good. stick to what you know and keep a tight lip on things you are not qualified to speak about. Crossing the line is an understatement there are some people like that in every industry. it does more harm than good. and grown folks should know better it only hurts their reputation in the end.

Sally, this is an excellent post and your timing is perfect. Not only are agents more prone to engage in many of these activities, the pressure they feel to "close the deal" can ahas a tendency to make them engage in other ethically questionable behavior!

Right on the money Sally. I have seen a lot of "experts" who gave advice that they should not have. Be who you are and let the licensed people handle their own part of the deal.

Hi Sally:

And let's not forget about the realtor who thinks they are an attorney.

Toula Rosebrock - Diane Turton, Realtors

I won't lend my opinion on what others should do...but to me...wearing too many hats will only cause your hair to fall out faster.

Sally--Very good reminder for those who like to walk the line of expert...I like to stay well on my side of the line!

"The mother or father who plays Realtor® because they bought a house in the past and suggests that they don't need their own Buyer's agent because they'll get a better deal through the seller's agent. Please stick to being a parent and not a Realtor® when you did not get the representation you needed and now have structural issues in your own home."

I always fondly refer to this scenario as "Daddy Deal Killer" They bought One Home - 30 Years Ago and they Know Everything!

Sally - The ones that have started to iritate me lately are the so-called "Marketing Guru's" who have the answer to "how I can take my business to new heights". PLEEEAAASSSEE!!! I've often found that most of these people haven't originated a loan in 10 years because they've been too busy touring the nation selling their magic potion.

Great post, and thanks for the reminder!

Kim

RE/MAX EXCEL, Logan Utah

Dean: I was sure I typed an answer last night...oh, well. The mind is a funny thing :) Anyway, it's all over the place...even across the pacific :) I've even heard of the renegoiation equation with inspectors. I don't think they sleep well at night. :)

Doug: That's a different story altogther...:)

Sherry: We know better though :)

Paula: Again...a different story altogether.

Jason" No kidding. We take many risks in life...but as professionals...not with peoples lives.

Hey Allison: Stick with what we do know....not what we 'think' we know....sounds good to me!

Benita: There all kinds in every country, city, industry and life...and the one thing that stick out for me is... I have good beliefs and values ...therefore, no crossing the line for this and anything else. It allows me to be successful...INSIDE...of course that transfers out though doesn't it?

Russell! Thanks. I agree....and it's happening with all sides of this industry and others as well....sad. If it's one thing that allows me to have faith in others is their ability to keep their dignity and integrity in tact...no matter what's happening around out there.

Paddy: Agreed wholeheartedly!

Toula: Or the air/mold/home inspector who thinks they are as well :)

Neal: Oh, goodness...I have a lock of hair...I guess I know where my head's at hehe.

Teri: Me too!

Long & Foster: Hmmm...I guess there's mommy, sister, brother etc. too haha.

Donne: Good one! I got a good one yesterday....he can MAKE ME MORE MONEY...geez.

I love my license too! Although I come from a career in accounting, I leave mortage stuff to the mortgage guy. I realize I might know just enough to stick my foot in my mouth.

Sally, you are right on the money, once again! Because after all, helping isn't really helping if it causes more problems than you started with, is it?

~Renae

Sally Great article, you are absolutely correct and I have definately run into the "so called experts"

Thanks for this information

Ken

Sally it is hard enough to keep up with everything that is going on with our specific area of this business without trying to take on other roles. If everyone concentrated on their part of the industry, kept up with the changes and training that affect them, we would all be far, far better off.

Other than being aggravating, it is a liability in most cases. Especially when you get into things like inspections and such. It's fine to be nice but keep it legal!

Kathy

Hopefully we will all stick to selling and not to sticking our necks out!

JAN

Sally, I see this quite often in the home inspection world as well. I tell my other inspector to KISS and do not elaborate on any topic...

Your building consultant for life ~~ Michael.

Good post. I don't know how many times I have seen someone trying to play double, even multiple roles. IF you have good colleagues and a tight network with other professions, you won't have to be so paranoid and feel like you need to be giving your advice about every aspect of the deal.Let the mort rep handle the mortgage, the home inspector handle the inspection, and the attorney handle the legal issues. Be a good Realtor, that is what your supposed to do.

Great thought provoking post. We cannot forget the agent that plays lawyer and advises someone to do a short sale as a solution to their problem. The problems with some of these issues may be viewed not as an item of E&O. If they are deemed fraud or are illegal and the agents are not covered for their misdeeds.

Oh ya I have seen all of them. I have learned when you are not 100% sure of something you should keep your mouth shut.

Our jobs would be a heck of lot easier if we did not get butinskys involved. That reminds me of a buyer I was working with last year. We did not close on the short sale. But during the process his sister inlaw kept giving her two cents. Just yesterday, I found out she cannot make her mortgage payments any longer and wants to sell her home to my client. They called to get advice so that is why I know what is going on with her.

JAN

Woo Hoo...

Over the years we've encountered problems as you've described in this post. We have had seen a Realtors who were Licensed as follows:

Realtor/Home Inspector.
Realtor/Title Company Owner.
Realtor/Mortgage Broker.
Realtor/Attorney at Law.

And my all time favorite:

Realtor/Home Inspector/Title Company Owner/Mortgage Broker.

Now this brings up the question how can a person have the best interest of the Customer in mind when he/she has so many wallets to fill? They can't. And no matter how many times folks like this try and defend their actions, I just don't agree. It's obvious to me that when you have that many roles to play in a transaction you're looking to have all the pie not just one serving. Personally I'll take one piece just cuzz I believe in portion control :)

TLW...ROAR!

Very good points Sally! I completely understand where you are coming from. Early in my career as an Austin home inspector, I encountered a very fiery client that told the realtor that they "wanted all these things fixed!" after giving her my report. I realized that these expectations were not realistic and vowed to help the realtors in this environment as best I could in the future. So, I make sure that my "sidewalk presentation" includes an overview of the home inspection's expectations. I tell them that I must report anything that is required by my state's standards, but that most of these are going to be handyman type issues and seller's are not required to present buyers with flaw free homes. We are looking for major issues that may have not been revealed by the seller's disclosure and may cost you money if theyare not addressed. I give helpful, common-sense repair tips and explain the concerns to educate them about how these issues might be easily addressed. I refer only to top notch contractors and make sure not to use language to 'scare' them back into an apartment.

Home Critique Logo

Good Morning Everyone!

Had to take a day off yesterday ...feeling lousy.

Ann: Then you're playing it smart :)

Renae: That's a fact!

Ken: We all have.

George: Exactly! And if everyone did what you said...it would all run smoothly. Life, huh?

Kathy: I remember someone telling me that being too helpful (without considering the consequences or ramifications) can be detrimental to ones own being. (Codependency tells one to keep saying yes when one means no)

Lise: That's a simple but to the point statement :)

Michael: KUSS?

David: Exactly. Conflict of Interest....all around.

Jim: Ohhhh...noooo...that's a no no. And yup...they're on their own after that.

Bill: Or at the very least...point them in directions where they can get info. Even then..it may not be the right place but at least we don't say something we don't know.

Angelia: No kidding. I've had to ask agents if it's mandatory that they use their loan co. ...in their same office (they advertise this in the agent section of our mls) and THAT is a no no. I turned down a showing the other day because of this. My buyers KNOW that they have their choice in lender...and they're already preapproved.

Hey Billie! And how are you today? We can put them in vice versa order too (i.e. Home Inspector/Realtor, LO/Realtor lol) and it's still the same thing....conflict of interest.

haha...I like that...wallets to fill. Because that's exactly what it is. Portion control is great way to describe the pie :)

Glen: I commend you on your expertise and your standards for what you are /are not qualified to do. This is the RIGHT way to do it. Thank you.

This will be a reblog for me tomorrow. The slope is sooooo slippery in this business - balancing the need to please against liability.

Sally,

Parents want to be so helpful but they do need to listen to the realtors, lawyers, mortage lenders.

The relators, lawyers, mortgage lenders need to be smart enough to let the parents help without killing the deal.

JAN

Sally - We don't give advice about anything but real estate. It's amazing how many times a real estate agent trying to be helpful has gotten him or her in trouble!

Jeff: The need to please is a different subject but directly affects ones judgement :)

Brenda: Agreed!

Bruce/Mary: No kidding!

We've all worked too hard in this business to end up losing our license over something we shouldn't have said. We try to be on everyone's side but that doesn't always turn out for the best. Stick to what you know and let the professional plumber, inspector, appraiser, loan officer, etc. do their job.

Kay: No kidding.

Did you all notice that I have my keys and cell phone hanging from my neck? lol....shows you how I keep tabs on them lol!

FEB

this is not an easy busy.

I agree with Susan Neal when she mentions agents that cite real estate law. However, particularly for agents that stay informed and know every facet of the industry, its hard to NOT give their opinion on a subject they have alot of experience with . I know agents that have been at this for 30+ years and a lot of them are a darn near authority on practically every aspect. Its a fine line for sure. Because I'm NOT an agent I just try and work with ones that operate with integrity.

FEB

Good information. I think each real estate agent must get control of their client and tell them the things that are likely to happen during the home buying or selling experience. Bad advice from all sorts of people is part of the landcape. Tell your client to relay any information they receive so you can adise them on how to handle it.

So true Celeste. It's easy to want to be "helpful" to your client and forget about the definite and sometimes not so definite lines we can cross. Good post! Thanks. Olga

Sally - That's a tough one for me. I like to share what I've learned with others, but in this business, you CAN be too helpful and end up in a lawsuit. I have to stifle my helpful impulses at times and refer my clients to their accountants, attorneys, mortgage brokers, etc. It's very important in this profession to stay within the confines of our area of expertise. Good reminder, thanks.

FEB

True, let's do our part and let other professionals do theirs!

FEB

As long as we have humans we will have this tug of war. Enjoy the ride. Great post.

Janice: No matter what....if we all would abide by some morals and paid attention to our own job instead of others it would go smoothly.

Private: I give my opinion on some things....on home inspections I go through the report and let my buyer know what he suggested for repairs....with numbers I tell them to make their loan officer do his job (just kidding...I refer them to their loan officer but I do guide them in the beginning to let the loan officer know what their monthly budget will allow for mortgage payment...otherwise, they start looking at half a mill homes when they can afford a condo.

Robert: This is such a small island that one steps on anothers toes and they are greatly remembered!

Olga: It's one thing to give opinions when something is not right....it's another to give opinions when it's not facts.

thanks Gail...believe me...I love to 'help' but know my boundaries.

Kevin: Simple but true.

Jay: We are all human and all have different thinking and opinions...but unless one wants to end up in a lawsuit or jeopardize their license .. we do what we are TRAINED to do.

FEB

Well said. So many people cross the line and start flapping there gums and have no idea what they are talking about.

It needed to be addressed and you said it!

FEB

Great post. I 100% agree. These things are not worth loosing your license. Thanks for the post.

FEB

One of those things where a little bit of knowledge can make you dangerous.

FEB

There are so many ways to get into trouble in this business. Be careful when you start giving advice out of your knowledge base.

FEB

Sally, I didn't see where if everyone else did their job and left mine alone I would have a lot less headaches and uncomfortable times.

FEB

Sally, it's unfortunate that everyone seems to wants their input. Their advise is worth exactly what you pay for, nothing.

Sally, Great article..nicely said!

FEB

Great post. I've found these situations in both newbies and old pros.

Thanks for your responses...something we all need to consider and be aware of.

FEB

Love the article Sally! Thanks!

MAR

Great points Sally. We need to stick to what we know and make sure that we encourage our clients to seek appropriate "expert" advice when it's warranted.

Leave a response…

Name:

Email:
(optional)

Comment:

What does the graphic say?