Code of ethics and how you recommend services

By
Home Inspector with REM Inspections LLC

Something to think about when you talk about ethics.

There is a practice going on that on the surface might not sound unethical but when you break it down creats problems.  I'm sure many realtors have not even considered that it might conflict with the code of ethics they have agreed to work by. 

I am speaking of what is often called "Preferred Vendors".  This is where the Real Estate company insists that companies they do business with pay to be on their "preferred list". 

This may be done by insisting that a company wishing to do business with the real estate company pay to advertise in their company brouchure or whatever.  In return the Real Estate company will only accept advertising from those companies.

In my case, I am a Home Inspector so let me speak to how this causes a conflict with the COE as it relates to home inspections.  The Home Inspector organization I belong to also has a code of ethics, http://www.nachi.org/code_of_ethics.htm, that I have agreed to work by.

I believe that I perform a valuable service to my customers and I take my job seriously.  Because of that I try to do the best I can to make sure that if someone hires me to make an inspection for them (or a realtor recommends me to one of their clients), that I provide them with a good honest inspection so they know what they are buying.  After all, that is what the home buyer wanted when they asked for an inspection.

I recently stopped at a Real Estate office to make sure my brochures were available to the realtors in case they had need of my services and was told that they only allowed brochures from inspectors who were "associates" and advertised in their magazine.  They showed me the magazine and it had 1 inspector listed.  They tried to tell me how well that could work for me to be one of only two inspectors to be listed in there.

This means that the realtors who work for that company have a total of 1 inspector to choose from!   I believe that the realtor COE mentions something about working for the best interests of the client.  I do not think that article of the COE is being met under these circumstances.  In reality, the inspector is chosen not because he will do a good job for the customer, or that he is experienced, but because he paid for the privilege of getting a referral.

There is also an article in the Realtor COE that says that any financial interests will be disclosed.  A Home Inspector paying to get referrals is a financial arrangement that contributes to the bottom line of the Real Estate company.

If that is not enough, The major Home Inspector Associations, ASHI, FABI, and NACHI all prohibit paying to be on these lists.  That means that the realtor is recommending an inspector that has already demonstrated that he will ignore his code of ethics so that he can help the realtor break their code of ethics.

Interesting!  I told them I was not interested.

Robert Sole

www.REMinspections.com 

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Groups:
ETHICS and the REALTOR

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainer
16,477
Bill Schwent
Casa Tierra Realty - Santa Fe, NM
Santa Fe Broker

Robert,

Excellent narrative of your dilemma.  I'd suggest you do two things:  file an ethics complaint with the local board or association of Realtors based upon what you have already identified.  There's also a potential Article one violation (honesty to all parties), an Article 2 violation (concealment of pertinent facts to ... the transaction) and Article 6 (recommendation for the financial benefit of the Realtor).  You might talk to either the chair of the local Realtor Grievance Committee or Professional Standards Committee for guidance.  Number 2, report the inspector to the professional organization to which s/he belongs.  I am not familiar with that process, but if the member is not adhering to your code, there must certainly be consequences.

Thanks for sharing this with us.

Mar 05, 2008 08:30 AM #1
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainer
258,445

Robert Sole

Ask me a question
*
*
*
*
Spam prevention