Commission Class Action Lawsuits Part 13

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Attorney and Mortgage Company insights!

Attorney Insights:

Clint Coons Esq. reviewed many of the new Commission Class Action Lawsuits from a legal strategy perspective and he discussed how attorneys will name multiple defendants in an attempt to get them to turn on each other in exchange for softer treatment. You can see this strategy unfolding in the QJ Team Class Action Lawsuit in Texas.

The commission lawsuits have arrived in Texas, but the QJ Team suit, named after its lead plaintiff, isn’t like your Moehrl, Sitzer/Burnett, March, Gibson or Batton 2 commission lawsuits. While the lawsuit does name large corporate brokerage firms as defendants, including Keller Williams, Side, HomeServices of America, and Fathom Realty, the robust defendant list also includes real estate teams, such as The Loken Group and Hexagon Group, as well as an individual broker.

The strategy is to go after trsmd or licensees individually to get them to cooperate to go after team leaders and brokerages. If someone told you individual licensees won't be named, they are wrong. It's already happening.

Mortgage and Financing Updates:

Richard Mantyla with Residential Mortgage has been a leader in the Mortgage field for decades and does an amazing job. If you haven't used him before you are missing a major asset in your team!

His company has direct access to Fannie Mae and Freddie Mac and he is on our team to keep you informed as this situation evolves. He did his homework before the conference and briefed the attendees on how this situation is evolving in the mortgage industry:

A VA buyer cannot pay licensee commissions. FHA and conventional buyers can, but any seller payment toward their portion is likely considered a seller concession. There will be some need for additional compensation agreements between sellers and buyer’s licensees, more transparency on purchase and sale agreements, and artful contract authoring going forward — or some combination of these. Seller concessions are calculated as a percentage of the purchase price, not the loan amount as follows:

FHA – 6%

VA – 4%


90% LTV = 3%

80% LTV = 6%

75% LTV = 9%

I am currently building resources and forms to address the tools you need to defend yourself when lawsuits come to Alaska. Stay tuned next week with an update on our upcoming webinars to share vital information you need to know.

Best regards,

Jerry Royse, ITI

It is going to get worse!

Live CE classes are better than Correspondence, particularly for this Class Action issue, additionally we have added the discussion and suggested strategies to reduce your risk to our DCE courses. It was exciting to see the networking, partnerships and strategic partnerships, team building recruiting and resource sharing that happened at our last live classes.

You should seriously consider signing up for our next live classes, Jan 6-7 or Jan 8-9, where we will give you tools to reduce your risk for the class action lawsuits that are likely heading our way. We will have workshops and role plays to refine your commission discussion to reduce your risk. You can't get that same level of protection and training in a correspondence class. But hurry to register, these classes have limited slots available and will sell out.

Jerry Royse, at the helm of Royse and Associates, stands out in real estate education with over 35 years of experience teaching across 46 states and 5 countries. A seasoned educator, Jerry has trained thousands in Sales Pre-Licensing and Continuing Education, also applying his expertise as an expert witness in over 30 legal cases and successfully closing over 1100 homes as a Buyer Broker. His extensive knowledge marks him as a preeminent expert in the field.

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