What agents and brokers can — and can’t — do under new MLS rules

Bright MLS legal counsel Brian Schneider explained the ins and outs of the NAR settlement rule changes. Here’s what real estate professionals need to know.

Key points:

• Even though NAR’s new rules could go into effect this summer, it could still be months until the court issues final approval, Schneider suggested.
• However, agents and brokers working with sellers will want to be careful about how closing costs and buyer compensation are discussed and shared.
• Additionally, when working with buyers, agents and brokers will have to negotiate their compensation directly with clients.

While solo agents, big teams and everyone in between are still seeking to understand the changing landscape of residential real estate, organizational and brokerage leaders are stepping up to provide more clarity.

Bright MLS — the country's second-largest MLS, whose territory covers 40,000 square miles spanning seven states, is following NAR's lead in speaking directly to media to clear up confusion surrounding the Mar. 15 settlement and what comes next.

Brian Schneider, Bright's legal counsel, co-hosted a webinar Friday to review the settlement terms and timeline, and specifically, outline what agents can and can't do after proposed rule changes go into effect later this summer.

While those changes are slated to go into effect by July, it could still be months later before the court grants final approval, Schneider noted. Additionally, individual MLSs will have to update their forms and internal systems between now and presumably mid-July.

For agents and brokers, Schneider provided a clear breakdown of the do's and don'ts affecting their jobs going forward.

When representing sellers, agents and brokers can .

• Continue to negotiate a contract with clients
• Enter the amount a seller is willing to provide in closing costs
• Recommend providing some form of buyer agent compensation
• Share their commission with the buyer agent
• Continue to enter closing costs in MLS after closing
• Include in the purchase agreement that the seller will pay the buyer broker/agent

. but they can't offer compensation via the MLS

While agents can discuss and agree on buyer agent compensation with their seller clients, they cannot enter an offer to pay the buyer broker/agent into the MLS.

When NAR discussed the settlement agreement with media in March, the association said agents and brokers "can put something generally" on their own personal business website, though NAR hedged at the time, saying its agreement "does not speak to the aggregators and what the aggregators will do."

Schneider offered additional clarity, noting that agents and brokers "can't post an offer to compensate the buyer broker/agent on other sites or apps that use MLS data," which would include the major home search portals that display MLS-based listings.

When working with buyers, agents and brokers can .

• Continue to negotiate a contract with clients
• Seek commission payment from the seller or the seller's broker

. but they can't proceed without a buyer agreement

Agents and brokers cannot work a buyer without a contract that specifies how much the buyer agent may earn, and that agreement must be in place before the agent does any showings. They also cannot accept more compensation than what was spelled out in the original contract.

Agents should also continue to speak with the broker or team lead when seeking further guidance on buyer agreements, as some brokerages have rolled out their own forms, while others will lean on state-mandated ones where relevant.

Bright also provided a guide for real estate professionals which lays out the settlement details and updates the MLS expects to be making.