Are "Buyer's Love Letters" Putting The Seller At Risk

In the recent red hot, real estate market, we have seen buyers competing heavily for desirable homes.

One way buyers are trying to tip the scales in their favor is writing love letters to the home sellers. They have heard their friends have done it or the agent representing them as home buyer has made the recommendation to write a letter to the seller. And, in some cases, it can help make the difference.

But as a seller, reading the letter can be putting you at risk for violating fair housing laws.

What Is A Buyer's Love Letter?

A Buyer's Love Letter is when a buyer writes a letter to a home seller. They include:

1. How beautiful, well decorated, how well kept, etc... the home is. What seller doesn't want to hear that!
2. Who the buyers are, where they are in life, what they do for work, etc....
3. How perfect their home is to be their forever home or raise their family or start off their life together, etc....
4. Often they will include photos of themselves and their family.

The point of the home buying love letter is to make a connection with the seller and even tug at their heartstrings. What mother who has lived in her house for 35 years and raised a family in that house with many happy memories, doesn't want her house to go to a loving family just starting out.

The homebuyer is hoping that emotional connection works in their favor.

Does A Homebuyer's Love Letter Work?

It depends. Some home sellers are.... show me the money....show me how much you like it with a strong offer!

But more often than not you can see the home seller's heart leap a little as they read the letter. Often reminiscing about past happy memories in their home or even play to their egos. At the very least it evokes an emotion or makes a strong connection.

Sometimes that connection can "buy" favor in the home seller's mind.

So yes the buyer's love letter in some circumstances will work.

Putting A Seller At Risk

The problem with the buyer's love letter is you potentially make the sale of the home about people and not the strength of the offer. When real estate decisions revolve around people there is a huge risk of violating fair housing laws.

Federal law does not allow discrimination based on:

• Race, Color, National Origin
• Religion
• Sex
• Presence of children in the household
• Disability

Each state can also add to the list of discrimination when it comes to fair housing as well. Here in Massachusetts, these are the additional protected classes of people you cannot discriminate against when it comes to housing:

• Section 8 or Public Assistance
• Sexual Orientation
• Gender Identity and Expression
• Marital Status
• Military or Veteran Status
• Age
• Ancestry

Where does it become a problem?

Having read a buyer's love letter opens up the seller to inadvertently violating fair housing laws or even sometimes blatantly violating fair housing laws. For example:

• You have two relatively similar offers. One is a young family starting out and they wrote a beautiful love letter. The second is an older married couple. You choose the families offer over the unmarried couple. Whether you did so because you wanted the house to go to the family or not, you have created a liability for yourself. The unmarried couple under Massachusetts Fair Housing Laws can claim you discriminated against them.
• Or say you blatantly choose the family because they would be a good fit for the neighborhood! Bad news. I recently had a buyer of mine write a love letter on the suggestion of the listing agent. I was told by the listing agent our offer was picked because they thought my buyers would be a good fit for the neighborhood.
• Maybe two competing offers create a situation where one writes in a buyer's love letter, they can walk to their church, temple or synagogue. EEEK! That's a no one situation either way. Either party can make a claim they were discriminated against based on religion, no matter what offer you pick regardless of whether the homebuyer's love letter had anything to do with your decision or not.

The list of examples can go on and on.... whether a seller blatantly, inadvertently or even does not make a decision based on the love letter it can open the seller up to a huge liability for even reading the love letters.

Just having a buyer make a fair housing claim can wreak havoc in an agent's and seller's life.

What To Do To Avoid The Liability

Because of your fiduciary responsibility as a listing agent, you must notify your seller of a buyer's love letter.

But, I would counsel them not to accept and read the love letters from any and all home buyers. Remind your seller that the offer must be based on its merits of price, terms and conditions and not the people involved.

The sellers should know as little about the people wanting to buy their house as possible except for their financial ability to buy your home.

Do not even ask personal questions about the buyers. Don't ask if its a young family or an older couple, or if they have kids.... no matter what your intent for knowing is, your motives can be questioned and used against you. Even when there is no malintent, just having the information can be a slippery slope.

This is one of the reasons why agents don't want sellers and buyers to talk directly to each other.... to avoid liability.

Is It All Right For Me To Write A Love Letter?

With all of that said about the danger of a seller reading a home buyer's love letter, there is absolutely no issue with a homebuyer choosing to do so.

Writing a personal letter to the seller may just help you get the homes of your dream. They may not read it but why not give it a try. You as a buyer are not violating fair housing laws by writing the love letter.

Summary

Selling your home can be emotional. You want your home to go to someone worthy of having it. But while caught up in some of the emotion of selling your house, leave out who the people are that are making offers on your home. The people except for their ability to afford your home have no room in the equation of accepting an offer.

If something should happen and someone made a fair housing claim against you and you can say "I know nothing about the people (buyers) involved" that would certainly wrap things up quickly.

Versus, "oh yea I remember them they were a nice family, or they were the unmarried couple, or she wanted to walk to her temple..." OOOOPS! Seemingly harmless statements that can indicate you may have made a decision based on the people and not the offer alone.**
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As listing agents, you have an obligation of informing your sellers of issues revolving around wanting to know who their buyers are and reading love letters.

Other resources:

• As a buyer or seller avoid dual agency. Bill Gassett explains why dual agency is bad for both buyer and seller. Neither party is properly represented.
• What are home sellers obligated to disclose to potential home buyers? Paul Sian points out different states have different disclosure laws for home sellers. Know your state's law about property disclosure.
• An HOA violation can mess up your home sale. Michelle Gibson points out that if there are recorded HOA violations at the registry it can mess with your home sale.

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