Understanding the NAR Lawsuit Settlement

What You Need to Know

In March 2024, in response to a pending lawsuit judgment against them, the National Association of Realtors® released a set of proposed policy and practice changes that will reframe the relationship between real estate professionals and buyers. To be clear, the industry’s fiduciary commitment to the best interests of clients hasn’t changed, but the way agents and buyer clients formalize professional relationships will.

Changes to the Homebuying Experience

As a homebuyer, this proposed settlement means there will be some changes to your real estate experience:

1. Required Buyer Agreements

Prior to this settlement proposal, it was acceptable (though not widely practiced) for buyer’s agents to forge relatively informal, unwritten agreements with their clients regarding service. Following these proposed changes, buyers must sign a service agreement with a real estate professional in order to be shown homes. 

2. Buyer’s Agent Compensation

Prior to the proposed changes in the settlement, buyer’s agents were compensated via a cooperation agreement with the seller and seller’s agent facilitated by the multiple listing service. While this sort of cooperation is still allowed, the MLS is no longer allowed to coordinate it. Buyer’s agents will now be responsible for negotiating their own compensation with clients.

FAQ

As a homebuyer, these changes will require new, important conversations between you and your real estate professional. A buyer service agreement will formalize your agent’s fiduciary responsibility to you, further protecting your interests. It will allow the opportunity for real, transparent communication with your agent around compensation, offering you a clear understanding of the cost of services and how those services benefit you. 

These conversations will ultimately set buyers up for greater success in their transactions. More buyers will start the home search process with a clear understanding of their strategy, how their agent will support them, and what it will take to get to the closing table. 

Two major changes: First, compensation offers to buyer’s agents will no longer be displayed on the MLS, and the MLS won’t be allowed to facilitate commission cooperation between the buy and sell sides of transactions. Second, all buyers will be required to sign a buyer agreement with their agent outlining service terms, including commission requirements.

Yes. Luxury Presence has created a strategy guide for agents seeking advice on negotiating buy-side compensation. Get your copy of The Future of Buy-Side Compensation here

The best agents have shifted their thinking from the top line to the bottom line. They're obsessed with the client experience. They're taking action very quickly to level up the technology in their businesses because they understand it's the only way to deliver strong profitability and a world-class client experience.

How I Work with Buyers

As my client, you can expect nothing but the highest level of service and counsel. I take my fiduciary commitment to you extremely seriously and believe that the best way to advocate for your best interests is through preparation. For each property my clients consider, I create a complete set of market research, potential pricing and offer strategies, contract negotiation tactics, and more. 

Before the NAR lawsuit settlement proposal, some buyer’s agents were able to get away with doing the bare minimum. Thanks to assumed cooperation with the seller, they might get paid for simply showing up, unlocking doors, and pushing papers.  While that was never my approach, it is now no longer the world we live in. As my client, you can rest assured that I will provide you with expert-level service and advice throughout our professional relationship.

Jarin Frederick is the consummate real estate professional. Jarin served as a seller’s agent for the sale of a rental property for my wife and I while we were living across the country. From our initial conversations to the final sale, Jarin was an absolute pleasure to work with. Her expert advice on how to renovate and price our property resulted in a sale that was significantly above the asking price. To accomplish this, Jarin deftly selected and coordinated all aspects of our contracted renovation work, following up and closing out every issue with exacting attention to detail - as if our property was her own. Her experience and depth of understanding of the Durham market was demonstrated repeatedly by prescient and accurate counsel on every aspect of the sale. In giving her advice she presented options, gave her best opinion and patiently allowed us to make our own decision. She never failed to answer my phone calls or respond to my text messages despite a heavy workload. Jarin’s integrity, drive and exacting standards completely earned my trust throughout the sale of our home. I hope to have the opportunity to work with Jarin again in the future. Jarin has my strongest recommendation as a real estate agent. You will not go wrong selecting her as your agent.

— Seller

Oh my gosh. We have recommended Rebecca to any friend who has talked about buying a house or selling their house. Rebecca will make you feel comfortable during the whole thing. She knows what she's doing. I remember now one thing Rebecca kept saying was that us ending up in a house that we didn't want to be in would be much worse than us not buying a house from her at all. She really wanted us to know, and wanted us to feel like what we needed was more important than anything else in this process, which was great. I think it's super useful that Rebecca has lived and worked in this area for a very long time. She knows all the ins and outs, she knows the neighborhoods, and she knows the people we'd be working with, especially the idea of having our first mortgage and working with a lawyer, which I've never had to do. And she knows all these people. She had great recommendations, but she was also happy for us to find our own people. Had we already had a relationship with someone, I know she would've been fine with that too. But yeah, it's a lot of handholding and I was happy for it.

— Christina M.

And also as queer people in Durham, we referred Rebecca to a lot of other queer folks who were trying to buy a home because she understands what it's like to buy a home with someone who's not a strictly heterosexual couple. And that also felt good to us.

— Chelsea A.

There's so much you have to think of when you're about to purchase a home, especially one that may need some work. And so her willingness to walk down that road with us and try to make it as easy as possible during something that could be really weird and complicated and we had never done before, it just, I think, bonded us, my husband, her and I in some way. And then we just really trusted her when we were ready the next time. I just crave authenticity and vulnerability and she brings all of that into her workspaces.

— Ashley A.

Rebecca was incredibly helpful during our home-buying experience. She was very friendly, honest, and accommodating. Since we were first-time homebuyers, she was more than willing to hold our hands through some tough choices and helped us refine what we were looking for. She was also able to be direct with us when we needed it. Rebecca is the reason why we are currently enjoying our new home!

— Brianna & Aaron

Comforting, knowledgeable, affirming and supportive are many of the words that describe our experience working with Rebecca when buying our first home. She made us feel more at ease in what is often a stressful and overwhelming process, especially for first time buyers. I am grateful for the ways she walked us through everything step by step, was responsive to all of our many many questions and took the time and care to truly understand our needs to make sure we weren't compromising our values along the way. As someone who is a member of the queer community, it was important to us that we worked with someone who not only was accepting of us but also affirming of the life and future we were building for ourselves through the purchase of our new home. We ended up buying the best home for us, our cats and our family. We are so grateful for Rebecca's care and support and would recommend everyone to work with her!

— Z & Sara