A recent tip from a Prudential California Realty manager indicated that managers are being pressured to use only ONE natural hazard disclosure provider – DisclosureSource. While requesting the agents to patronize one provider of a settlement service is not that unusual for a real estate company, the requirement of the use of a settlement service, without the agent having a say in the selection, is unheard of and raises a number of troubling questions.
I decided to contact several more Prudential managers on a completely confidential basis and see if they could shed some light on what was going on.
One manager said:
"We had a preferred vendor, but anyone can use whoever they want," one manager said. "In theory, it's selected by the client."
Another manager had this to say:
"We can use anyone we want," he said. "If the buyer and seller agree on a company, they can use it. But every realty company has a preferred vendor. We may have a company we prefer to use, but we change all the time, based on insurance coverage."
What is missing from these responses and others I received is what role does the agent play in the selection of a disclosure report? From what we have heard the answer would be “very little.” Apparently Prudential expects their agents to set aside both their right and responsibility in the selection of a third-party disclosure report provider and blindly follow whatever Prudential corporate business arrangement that happens to come down the road.
I’ve been around real estate agents for a long time and, to put it mildly, they are an independent group. They tend to hang on to their circle of settlement service providers regardless of corporate mandates. This brings to mind the question, how do you effectively make a large group of agents automatically change allegiance from a company, that we understand, has been extremely popular with them for many years?
Something does not seem quite right. I will report back as this investigation continues.
Wednesday, August 19, 2009
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