Disclosure law hopes to provide more transparency to agents and clients

January 03, 2011 08:58AM

From left: REBNY’s Neil Garfinkel and Halstead’s Diane Ramirez

A new law requiring a real estate agent to have clients sign a form stating that they understand whom the agent represents and to whom the agent will give “undivided loyalty,” will go into effect this year, the New York Times reported. The disclosure law is designed to clarify the roles of buyers’ and sellers’ agents. “This is a consumer protection law, but it also protects brokers, because now they will have a written record of what they’re already required to do now verbally,” said Neil Garfinkel, residential counsel to the Real Estate Board of New York. Previous disclosure forms were required only in transactions involving single-family homes and buildings with four or fewer units. If a complaint is filed against an agent for not producing a disclosure form, the penalty is a fine of up to $1,000 and, potentially, a requirement that the agency return the commission. The law will also apply to sellers and landlords. Diane Ramirez, the president of Halstead Property, said she supports the law, noting that Connecticut and New Jersey have similar ones. “Things will be more transparent and that’s good for our industry, and the public will be happy to know that nothing has been hidden,” she said. [NYT]