We hear it often, and the MLS Board of Directors periodically reviews requests for a policy change to the requirement that a listing be marked as under agreement with a contingency or pending in the MLS database. You may already be aware, Zillow and Trulia will not market a listing as active if it has an offer on it, regardless of how you indicate such in the MLS. Why? Because of truth in advertising. As we’ve heard before from the National Association: Pending is Pending is Pending.
The argument can be made that you are doing what is in the best interest of your seller by delaying a status update in the MLS while there are outstanding contingencies. While that may be what your seller desires, please remember that you are bound by consumer protection laws and the Code of Ethics to be truthful in all advertising that you do.
Residents of Massachusetts are indeed fortunate to be protected by one of the strongest consumer protection laws in the nation. This law — often referred to as “Chapter 93A” — prohibits “unfair and deceptive trade practices.”
Chapter 93A covers a wide range of improper conduct by businesses. It has been interpreted by our courts to mean that any material statement or representation that has the “capacity or tendency to deceive” is unlawful. Non-disclosure of important information about a product or service can also violate the statute.
Chapter 93A provides a powerful remedy for consumers. If it is proven in court that the conduct in question violated Chapter 93A, the consumer must be awarded actual damages or $25, whichever is greater. In cases where the misconduct was willful or knowing, the damages must be doubled or trebled by the court. The consumer will also be awarded costs and reasonable attorney’s fees.
Code of Ethics – Article 12:
REALTORS shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations…
Your fiduciary duties to your seller do not include deceptive practices to consumers or other agents and instruction from your seller cannot be to break the law or violate the Code of Ethics. Every agent needs to be cognizant of their duties to customers, clients and other REALTORS, and all brokers should be aware that in such instances you can also be held accountable for the actions of your associates. The better practice is to advise your seller what your obligations for disclosure and truthful advertising are and how that will reflect in the MLS as well as on syndication sites.
As always, if you have any questions about the procedure for when and how to mark a listing as under agreement show vs pending, please contact the Board Office staff for assistance. We’ve also posted about this subject before, and that can be found here.