Are Letters to Sellers Illegal? 

 

Written by Ashley Sutphin Posted On Wednesday, 17 May 2023 00:00

 

The housing market has been intense for buyers, to say the least.

The inventory of available properties around the country is low, and demand is high. That leaves many buyers scrambling to figure out how they can set themselves apart in the eyes of a seller. Not everyone can raise their offer above asking. Even if they do, there’s no guarantee they’ll get the property.

That means many buyers tend to use other tactics to score a home, including writing letters to a seller.

It’s not inherently a bad idea, and it’s something that a real estate agent might recommend in some cases. The idea is that you can explain more about who you are and why you love the house. Many sellers have an emotional connection to their home, and they want to feel like someone else will enjoy it the way they have over the years.

At the same time, before you start writing a letter, check with your real estate agent because it could create a problem.

Oregon Bans “Love Letters”

During this past summer, would-be homebuyers in Oregon became prohibited from writing what was referred to as love letters to sellers.

Oregon Governor Kate Brown signed a bill into law, which was the first of its kind in the country, telling seller’s agents they have to reject this type of communication. The law went on to say that in general, there shouldn’t be information transmitted between buyers and people making a bid on a home outside of the traditional offer.

What’s the Problem?

Many might be wondering what the problem is with a seemingly harmless letter explaining why you’ve fallen in love with a home.

According to critics, the letters can create fair housing risks.

They might contain personal information or characteristics about a buyer, such as their race or family status. That information could intentionally or unintentionally affect a seller’s decision to accept or reject an offer.

National Association of Realtors Response

The National Association of Realtors (NAR) spoke out after Oregon took action banning letters to sellers. The organization said it wasn’t aware of any situation where these letters led to legal action or lawsuits. NAR said in the statement that real estate transactions should use only non-discriminatory and legitimate criteria when decisions are made.

What Can Realtors Do If Clients Do Want to Write a Letter?

Unless it’s explicitly banned where you work or where your clients are buying a home, in most places, they can still legally write a letter to the seller.

As a real estate agent, it’s essential to educate them about what they can and can’t include in these, however.

First, go over the details of everything your client should know about writing a letter, including the upsides and downsides. If you’re working for a seller, you should let them know you can’t accept letters as part of an MLS listing, and you need to remind your clients that whether or not to accept an offer should only be based on objective criteria.

If you have a client who wants to write a letter, don’t help to draft it, in addition to not delivering it.

Don’t read these letters, and document any offers received, as well as the seller’s reason for accepting one over the others.

Overall, in most cases, there’s not a legal issue with writing a letter to a seller unless it has some information that could be used in a discriminatory way. If you’re a real estate agent, make sure you’re up to date on everything you need to know about fair housing laws and your role if a letter is involved