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Legally speaking: Am I allowed to ‘cold call’ for business?

By Peg Ritenour, OAR Vice President of Legal Services/Administration

The OAR Legal Assistance Hotline receives an array of real estate-related legal questions — including license law issues, disclosure, contract law, ethics and commission problems, among others. In an effort to help you work within the law, our “Legally Speaking” series spotlights some of the timely questions that are being asked by REALTORS. This one involves rules pertaining to phone solicitation…

Q: I am thinking about having my licensed assistant “cold call” FSBOs and expired listings to try to either solicit the listing or to determine if I can represent the owner in the purchase of a property. Another agent told me that you aren’t allowed to do that anymore. Is that true?

A:  The reason why cold calling isn’t as common as it once was is due to the restrictions of the federal Do-Not-Call law. Before you do any cold calling it is important to determine if the person you are calling is on the Do-Not-Call list. If they are, there are limitations on your ability to contact them. Below is an excerpt from Q&A prepared by NAR on how the this law applies to calling FSBO’s and expired listings:

Do the rules apply to calls made to FSBO’s?

There are two instances when a real estate professional would call a FSBO seller. The first would be a real estate professional seeking of a FSBO listing, and the second would be a buyer’s representative who believes his/her client might be interested in a FSBO property. A buyer’s representative can contact a FSBO owner whose number is listed in the Do-Not-Call registry about a client’s potential interest in the property, as this call is not a telephone solicitation by the buyer’s representative. Note that the buyer’s representative can only discuss his/her client’s interest in the property and not use a purported client’s interest as a way to also discuss the possibility of the FSBO owner listing his/her property with the buyer’s representative.

However, a real estate professional would be prohibited from initiating a telephone call to a FSBO seller whose number is listed in the Do-Not-Call registry in an attempt to obtain a listing. The rules prohibit anyone from making telephone solicitations to telephone numbers that are registered in the database, and a call initiated to obtain the listing falls within that definition.

Can I still call expired listings?

The established business relationship exemption permits the listing agent as well as other agents from the same company to contact the seller for up to 18 months after the expiration date. For all other agents, the Registry must be consulted prior to calling. If the seller has placed their number in the Registry, you should refrain from calling them.

Click here for more information on the Do-Not-Call laws.

Tags: legal, Legally Speaking