Why Buyer Letters Are A No-No

By Stephanie Goedl
June 11, 2021

(Transcript of our Podcast Ep. 41)

Hey, everybody, and welcome back. It’s Stephanie Goedl here. You know, it’s been a few months since we’ve recorded, we decided to take a short break to reevaluate our content and make sure that the education we are providing is relevant for what’s going on today. So, with that, let’s hop right in and jump into buyer letters.

Most of you are aware of Buyer Letters especially if you’ve been in the business for a long time. One way to really assist buyers in standing out when writing offers and when you’re up against multiple offers has always been to submit a Buyer Letter. However, now, that is kind of a No-No. I want to talk about that today and dive in just for a few minutes and talk about why that is. 

With everything that’s been going on in our country lately, there’s a lot of talk around discrimination, whether intentional or unintentional. When you dive into Buyer Letters, it’s something to really consider because your sellers sometimes are making a decision that’s based off of those letters, and not necessarily on the terms of the agreement.

The California Association of Realtors as well as our National Association of Realtors, have taken a stance against Buyer Letters and are really pushing that we should not be submitting those if there’s personal information or photos attached to those offers. To avoid that intentional or usually it’s unintentional bias or discrimination against those buyers.

Let’s just talk about an example really quick. Fun fact, actually, before we dive into that example, did you know that as of November 2020 there were 22 protected classes in the state of California. Back to my example. When you receive a letter, many times the buyers pour their heart and soul and tells their story as to why they want to purchase the home. Example: “This big backyard is perfect for my children to run around and play and get some fresh air.” Now, if you know that discrimination is not even in your mind, you can look at that and say, Wow, that’s wonderful, these three kids definitely need a place to run and play. I want to go with them. What’s the problem with that? If you are picking that offer, based on the fact that the letter really tugged at your heartstrings as a seller, you can be considered to violate the family status, which is a protected class. Especially when you’re looking at another offer from a single person who has no children.

You really want to avoid Buyer Letters because they have the potential to create a level of unintentional discrimination. If you’re a buyer’s agent you should avoid submitting those letters on behalf of your buyer. If you’re a listing agent, you want to have that conversation with your seller. And let them know that again, 98% of the time, I would say it’s very unintentional bias. But that being said, it’s still there, whether or not it’s being recognized. Let them know about the possible hiccups that can come with reviewing those offers and highly encourage them to look at the terms only, because this is a business transaction. As a professional REALTOR you need to encourage them to look at just the terms of the offer.

So how do you have that conversation with your seller? The California Association of Realtors has a great piece that you can actually share with your sellers that goes into this in a little bit more detail. And then get it in writing from them that they will not be accepting Buyer Letters. Also, put that into the MLS and have that conversation with the buyer’s agents on the other side and let them know the seller has decided not review any buyer letters. That keeps it very neutral and everybody in a really safe space. So, with that, I just wanted to pop on and give you a quick update on what has changed in our industry over the last few months. If you have any questions as always, do not hesitate to reach out. Can’t wait to see you on the next episode. Have a great day.

Listen to the Podcast here:

Ep.41 | Why Buyer Letters Are A No-No Discover Your Real Estate Career

Stephanie Goedl

About the author: Stephanie Goedl is Chief Operating Officer and Broker/Owner of CENTURY 21 Discovery. If you are interested in becoming part of the CENTURY 21 Discovery team or would like more information about our services or training we provide contact us at 714.626.2069 or Careers@C21Discovery.com.

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