Member Orientation

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Member Orientation
Welcome to the largest trade organziation
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Got a question?
Ask Your Broker!
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Three-way Agreement

• National Association
• Of REALTORS
• Arkansas REALTORS
• Association
• Local Board of
• Realtors

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Structure Governance

• National Association of REALTORS
• 1.3 million members
• Over 30 major policy suggesting committees
• Board of directors/executive committee
• Annual member meetings, May November
  Convention

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Structure Governance

• National Association of REALTORS
• Chicago all member services except political
• Washington, DC legislative and political

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Structure Governance

• Arkansas REALTORS Association
• Membership of approximately 8,400
  out of approx. 11,000 active licensees in
  AR
• 13 committees and task forces
• 38 member Board of Directors
• 8 member Executive Committee
• 9 member staff

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Structure Governance

• Arkansas REALTORS Association
• Member/Local Board support
• Update NAR with local and state political
  and market conditions
• Maintain open dialogue with state and federal
  agencies on behalf of the members
• Toll Free, 888-333-2206 or
• 501-225-2020

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So, what does all this mean to me?
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From Our House To Your House

• National Association of REALTORS
• NAR Magazine
• Todays REALTOR
• Up-to-date with
• REALTOR.Org
• Member discount programs

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From Our House To Your House

• Arkansas REALTORS Association
• ARA Newsletter
• REALTOR Rightings
• Up-to-date with
• www.arkansasrealtors.org (some areas are secure
  for members)
• Knowledgeable, professional staff
• Call us!
• 888-333-2206 or 501-225-2020

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Educational Opportunities

• National Association of REALTORS
• Mid-Year Conference in Washington D.C.
• Annual Convention with over 300 educational
  sessions

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Educational Opportunities

• Arkansas REALTORS Association
• Graduate, REALTOR Institute Program (GRI)
• Annual State Convention featuring numerous
  industry speakers
• CRS courses sponsored by the AR Chapter CRS
• ABR Courses
• Annual Forms Training to Local Boards

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Designations Specialized Education

• Graduate, REALTOR Institute (GRI)
• Certified Residential Specialist
• (CRS)
• Accredited Buyer Representative
• (ABR)
• e-PRO

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Designations Specialized Education

• Certified Residential Broker
• (CRB)
• Certified Commercial Investment Member
• (CCIM)
• Institute of Real Estate Management
• (IREM)

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Risk Reduction

• National Association of REALTORS
• Legal Action Program
• Legal Liability Series

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Video Tape

• ANTI-TRUST

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Risk Reduction

• Arkansas REALTORS Association
• ARA Legal HOTLINE via e-mail
• Legal FAQ site ON-LINE (secure, requires
  sign-in)
• Member discount on Real Estate Forms
• Over 2400 man hours annually spent by REALTOR
  volunteers on forms development

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For the Public for the REALTOR

• National Association of REALTORS
• A staff of over 50 in Washington D.C. serving
  as watchdogs and lobbyists for YOU and
  Property Rights!
• REALTOR Legislative Network
• REALTOR Political Action Committee (RPAC)

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For the Public for the REALTOR

• What can YOU do?
• Understand Private Property issues
• Come to the Mid-Year Conference and get to
  know your federal legislators
• Respond to the Calls to Action through Action
  Center on Realtor.org.

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For the Public for the REALTOR

• Arkansas REALTORS Association
• Two Contract Lobbyist at the Capitol daily
• Member-driven decisions
• Members kept up-to-date during the
  Legislative Session through ARA website
• ARA is politically active year round
  watching out for your rights!
• ARA supports members seeking elected office

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RPAC

• REALTORS Political Action Committee
• Allows members to help candidates who
  understand our industry
• Helps open doors and encourages lawmakers to
  keep an open mind on our issues
• Positions REALTORS as legitimate players in
  the political arena who command respect

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RPAC

• REALTORS Political Action Committee
• What ARPAC is NOT!!!
• Partisan
• A Vote-buying vehicle

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RPAC

• REALTORS Political Action Committee
• RPACs Recent Successes
• Private property rights bill
• Housing for Older Persons Act
• Health insurance deduction
• Maintaining mortgage interest deduction
• Prevented Banks from entering the Real Estate
  Business

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ARPAC

• Arkansas REALTORS Political Action Committee
• In 2006, ARA Lobbyist voted best in the state.
• In 2006, ARA ranked 1st in spending, preparing
  for and lobbying for the 2006 Session

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ARPAC

• Arkansas REALTORS Political Action Committee
• WHY CONTRIBUTE?
• Investments in the future of your business
• Tax credit on State Income Tax , not a
  deduction
• Imagine the IMPACT magnified by over One
  Million REALTORS

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Legislative Political

• What If?
• You were responsible for discovering structural
  defects
• You were required to research every listing
  neighborhood for registered sex offenders
• You had to pay sales tax on your earned
  fee...
• You were responsible for ANY defects in a home
  you sold beyond required disclosure by law

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TECHNOLOGY

• National Association of REALTORS
• E-Commerce
• REALTOR.Org and REALTOR.COM
• Membership Records (NRDS)
• Technology is best observed at NAR Convention

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TECHNOLOGY

• Arkansas REALTORS Association
• New Task Force named
• Task Force reports on software and hardware for
  members
• Real Estate Forms software
• Interactive, full-service website
• Large projects being formed now

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FAIR HOUSING

• PROTECTED CLASSES
• The Fair Housing Act Prohibits discrimination on
  housing because of
• Race
• Color
• Sex
• Religion
• National Origin
• Handicap
• Familial Status

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FAIR HOUSING

• National Association of REALTORS
• Legal Liability Series
• Fair Housing Partnership Agreement
• At Home with Diversity Certification

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FAIR HOUSING

• Arkansas REALTORS Association
• State Fair Housing Partnership Agreement with
  HUD
• Equal Housing Opportunity Posters provided
• Staff/Officers available to speak at Local
  Board Meetings

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FAIR HOUSING

• FAIR
• HOUSING
• VIDEO

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Public Relations

• National Association of REALTORS
• 50,000,000 Public Awareness Campaign
• 2008 and beyond
• year around.

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Public Relations

• Arkansas REALTORS Association
• Award for Excellence
• Arkansas Special Olympics.
• House to House weekly column to over 320,000
  households.
• Over 1,000 articles and news in newspapers
  throughout the state annually.

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Public Relations

• Arkansas Special Olympics
• 1986 - ARA Becomes a Premiere Sponsor
• Since 1986, ARA has raised over 1,200,000 on
  behalf of Special Olympics

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Public Relations

• Awards for Excellence Program
• Statewide program to recognize Top Producers
• Based on listing, leasing and selling volume
  
• Available in residential, commercial, and
  property management

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Public Relations

• REALTOR-of-the-Year
• Arkansas REALTORS Association
• Local Board recipients honored at Gala during
  Annual Convention and Trade Show. One
  outstanding REALTOR named ARA Realtor of the
  Year at this Gala.

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VIDEO

• CODE OF ETHICS

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The REALTOR Code of Ethics
New Member Orientation Program
National Association of REALTORS
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History and Background of the Code of Ethics

• National Association of REALTORS? formed in 1908.
• No license laws at the time.
• Real estate industry had a history of
  speculation, exploitation, and disorder.

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History and Background of the Code of Ethics

• Code was adopted in 1913 to establish a
  professional standard of conduct.
• Code of Ethics formed the basis for license laws.

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History and Background of the Code of Ethics

• From its inception, the Code of Ethics required
  arbitration of monetary disputes between
  REALTORS?.

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• Under all is the land

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The Preamble

• The Golden Rule
• Widely allocated ownership and widest
  distribution of land ownership
• Maintain and improve the standards of their
  calling.

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The Preamble

• Share with fellow REALTORS? a common
  responsibility for the integrity and honor of the
  real estate profession.
• Strive to become and remain informed on issues
  affecting real estate.
• Willingly share the fruit of your experience and
  study with others.

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The Preamble

• Identify and take steps to eliminate practices
  which may damage the public or which might
  discredit or bring dishonor to the real estate
  profession.
• Urge exclusive representation of clients.
• Do not attempt to gain any unfair advantage over
  competitors.
• Refrain from making unsolicited comments about
  other practitioners.

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The Preamble

• If an opinion is sought about a competitor (or
  the REALTOR? believes comment is necessary), the
  opinion should be offered in an objective,
  professional manner.
• The term REALTOR? stands for competency,
  fairness, high integrity, moral conduct in
  business relations.
• No inducement of profit and no instruction from
  clients can justify departure from these ideals.

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The Three Major Sections

• Duties to Clients and Customers
• Duties to the Public
• Duties to REALTORS

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The Structure of the Code of Ethics

• Articles
• Broad statements of ethical principles.
• Standards of Practice
• Support, interpret, and amplify the Articles
  under which they are stated.

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The Structure of the Code of Ethics

• Case Interpretations
• Specific fact situations to which the Articles
  and/or Standards of Practice are applied.
• Only Articles of the Code can be violated, though
  Standards of Practice can be cited in support of
  an alleged violation.

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Ethics or Arbitration

• Ethics Basic Issue
• Is there a possible violation of the Code of
  Ethics?
• Arbitration Basic Issue
• Is there an arbitrable issue, that is, a money
  dispute?
• Typically a dispute over which REALTOR? is
  entitled to the cooperative commission in a
  transaction.

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The Ethics Enforcement Process

• Who can file a complaint?

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The Grievance Committee

• A screening committee comprised of members of the
  Association appointed to the committee.
• Key question for the Grievance Committee
• If the allegations in the complaint were taken
  as true on their face, is it possible that a
  violation of the Code of Ethics occurred?

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Professional Standards Hearing Panel

• Function is to conduct a full due process
  hearing with sworn testimony, witnesses and
  evidence.
• Hearing Panel is comprised of members of the
  Professional Standards Committee.

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Professional Standards Hearing Panel

• After conducting a hearing, the Hearing Panel
  decides whether there was a violation of the Code
  of Ethics, proven by clear, strong and convincing
  proof.
• If the Hearing Panel finds a violation of the
  Code of Ethics, the Panel then determines the
  discipline to be imposed on the violator
  (respondent).

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Authorized Discipline(and administrative
processing fees)

• Letter of Warning
• Letter of Reprimand
• Education
• Fine not to exceed 5,000
• Probation for one year or less
• Suspension for not less than 30 days nor more
  than one year
• Expulsion from membership for period of one to
  three years
• Suspension or termination of MLS privileges
• Administrative processing fee (if found in
  violation) not to exceed 500 (Court Costs)

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The Arbitration Process

• Request filed.
• Arbitration is conducted under Article 17 of the
  Code of Ethics and the state arbitration statute
  (if any).

Arbitrate - Don't Litigate!
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The Arbitration Process

• Article 17 provides that arbitration occurs under
  the following circumstances
• Contractual disputes or specific non-contractual
  disputes
• (see Standard of Practice 17-4)
• Between REALTORS? (principals) associated with
  different firms
• Arising out of their relationship as REALTORS??

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Grievance Committee

• Committee performs a screening function similar
  to review of ethics complaints.
• Key question for the Grievance Committee
• If the allegations in the request for
  arbitration were taken as true on their face, is
  the matter at issue related to a real estate
  transaction and is it properly arbitrable, i.e.
  is there some basis on which an award could be
  based?

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Mediation

• A voluntary process in which disputing parties
  meet with a mediator appointed by the Association
  to create a mutually acceptable resolution of the
  dispute, rather than having a decision imposed by
  an arbitration hearing panel.

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Mediation

• Mediation can occur before or after the Grievance
  Committee reviews requests for arbitration,
  depending on local Association policy.
• If a dispute is resolved in mediation, the
  parties sign an agreement spelling out the terms
  of the settlement, and no arbitration hearing is
  held.

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Professional Standards Hearing Panel

• Function is to conduct a full due process
  hearing with sworn testimony, witnesses and
  evidence.
• Hearing Panel is comprised of members of the
  Professional Standards Committee.

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Professional Standards Hearing Panel

• After the hearing, the Hearing Panel decides
  which REALTOR? is entitled to the award
  (typically a disputed commission in a
  transaction), proven by a preponderance of the
  evidence.

Materials Page 7
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Payment of the Award

• Generally, the award of the Panel in an
  arbitration case can be judicially enforced if
  not paid by the non-prevailing party.
• Some associations have procedures requiring that
  awards by deposited with the association pending
  review of the hearing process or during legal
  challenge.

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NARs Arbitration Guidelines

• Found in the Code of Ethics and Arbitration
  Manual.
• Guidance to Hearing Panels as to how to determine
  procuring cause in arbitration hearings.
• Also referred to as Suggested Factors for
  Consideration by a Hearing Panel in Arbitration.
• Guidelines focus on procuring cause as the
  basis for resolving most commission disputes
  between brokers.

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Key Factors in a Procuring Cause Dispute

• No predetermined rule of entitlement may be
  established by an association.
• Hearing Panels should consider the entire course
  of events.
• Matters such as the first showing of the
  property, the writing of the successful offer or
  the existence of an agency relationship with the
  buyer are not, in themselves, exclusive
  determiners of procuring cause/entitlement.

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Key Factors in a Procuring Cause Dispute

• The key concepts of procuring cause are
  referenced in this definition from Blacks Law
  Dictionary, Fifth Edition
• The proximate cause the cause originating a
  series of events which, without break in their
  continuity, result in the accomplishment of the
  prime object.

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Article 1

• Protect and promote the interests of the client
• This obligation to the client is primary
• But must treat all parties honestly, regardless
  of agency or non-agency relationship.
• Standard of Practice 1-2 defines terms such as
  client, customer, agent, and broker.

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Article 2
Disclose,
disclose,
disclose!!
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Article 2

• Avoid exaggeration, misrepresentation and
  concealment of pertinent facts about the property
  or the transaction
• But there is no obligation to discover latent
  defects, matters outside scope of license, or
  matters confidential under agency or non-agency
  relationships.

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Article 9

• Get it in writing!!!

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Article 9

• Agreements shall be in writing whenever possible
• In clear and understandable language
• Expressing the specific terms, conditions,
  obligations and commitments of the parties.
• A copy of each agreement shall be furnished to
  each party upon their signing or initialing.

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Article 9

• Standard of Practice 9-1 requires that reasonable
  care be used to keep documents current by use of
  written extensions and amendments.

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Article 12

• Truth in advertising!!

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Article 12

• Present a true picture in your advertising and
  representations to the public.
• Ensure that the professional status of REALTORS?
  is clearly identifiable in any advertising.

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Article 16

• Do not engage in any practice or take any action
  inconsistent with the agency or other exclusive
  relationship that other REALTORS have with
  clients.

Respect
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Article 16

• Examples of issues covered by Article 16 and its
  Standards of Practice
• Innovative or aggressive business practices
• Advertising/solicitations which may be received
  by other REALTORS? clients
• Solicitation of listings and agency relationships
  of clients of other brokers
• Dealing with other brokers clients
• Obligations when entering into exclusive
  relationships
• Agency and/or brokerage relationship disclosure

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The REALTOR? Code of Ethics

• protects the buying and selling public.
• promotes a competitive real estate marketplace.
• enhances the integrity of the industry.
• is your promise of performance.
• is your promise of professionalism.

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The images used herein were obtained from IMSIs
MasterClips? and MasterPhotos? Premium Image
Collection, 1895 Francisco Blvd. East, San
Rafael, CA 94901-5506, USA
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Local MLS Rules and Regulations