Comments on: The Gods Must Be Crazy

By: Atlanta

Atlanta — Sun, 29 Jun 2008 21:50:15 +0000

The only part of Fred’s statement I agree with, is this that HB 4313 is an over-reaction, an in my opinion, mostly from Real Estate Licensees who want to keep the status quoe.

Just for clarification, in most cases, those of us who offer rebates, negotiate just as hard as any other REALTOR to assure the client gets the best price and terms.

There is no need to inflate the price. We do more deals, and work more sophisticated clients.

By: Fighting Illini (Anti-Rebate Bill “Crushed”) | Redfin Corporate Blog

Thu, 13 Mar 2008 06:08:02 +0000

[...] by the Illinois legislature to outlaw refunding real estate commissions to consumers, which we complained about last month, finally died today. An obscure group called the Homeowners Club of America had supported the bill [...]

By: Fred

Fred — Fri, 07 Mar 2008 04:27:06 +0000

I’ll just throw this out there and see what kind of reaction comes from it.

Possibel Rationale: The essence of mortgage fraud is that the transaction is in some way altered in a way that is disadvantagous to the lender(s). Now I know that everyone hates lenders because they try to attain that dirty “profit” word, but is it fair to ask a lender to bear the burden of kickbacks in a transaction. The idea is this: rather than writing the buyer a check, reduce the financed portion of the loan. I know that would mean that the buyer can’t run out and buy that new TV (or car depending on the size of the sale), but when things come crashing down in a foreclosure the bank is left holding the bag on that new TV. The consumer gets to keep the “kick-back” money and the lender is left with an over inflated loan on a property. Mortgages are meant for and should only be used to finance houses, not kick-backs. For those that care, that is what the proposed law is about, albeit an overreaction to the situation.

By: Mark Reitman

Mark Reitman — Wed, 05 Mar 2008 18:51:10 +0000

The Bill was not called for its hearing today. Next week is the deadline. If they don’t call it then, it’s dead (according to the IAR). The IAR believes that the main sponsor, well aware of its and the DOJ’s opposition, is trying to amend the bill to make it more “passable”. However, the IAR does not believe any amendment would remove its opposition.

Looks like, sometimes, even the Gods must answer to a Higher Power.

By: Brian

Brian — Mon, 03 Mar 2008 08:44:22 +0000

This appears to be rescheduled:
Civil Law Committee Hearing Mar 5 2008

By: Eric Cunliffe

Eric Cunliffe — Wed, 20 Feb 2008 22:28:30 +0000

Heaven save us from legislators that have no clue about issues that they attempt to pass laws about. In a real estate market that needs all the help it can get how on earth can these people justify such anti-consumer attitudes. I’d like to think that it is just plain stupidity and that it is not a reflection of the States desire to join such other uneducated anti-consumer states such as New jersey where rebates are banned in the name of consumer protection. Give me a break – these are participants in the transaction that are directly or indirectly paying our fees anyway.
In repsonse to Dave, the Realtors(R) are in fact paying taxes on their entire commission and the consumers are not receiving income but merely a reduction in the cost of their fees regardless of whether they are buyers or sellers so the State should have no beef with that.

By: dave davidson

dave davidson — Wed, 20 Feb 2008 18:31:04 +0000

Could it be that when rebates are given to consumers that the state governement is not getting paid their tax portion of the rebates. I assume that if one gives a rebate to a buyer that the buyer must declare income at tax time.

By: Mark Reitman

Mark Reitman — Mon, 18 Feb 2008 22:14:49 +0000

Glenn,
I have a little more insight from the IAR’s weekly newsletter on government issues.

With regard to the question of the rationale and how this anti-rebate legislation can conceivably be in the public’s best interest, it isn’t. In fact, neiher the initiators (the “Homeowners Club of America”), nor the sponsors, even pretend that the public’s interest would be served. The legislation, according to the HCA’s own written material, is aimed at “west coast brokers attempting to change Illinois commission structures”. This ‘rationale’ was repeated to me by Rep. Molaro’s office. One of the other sponsors gave me a different lame argument, while acknowledging that the consumers’ rights were akin to the “baby being thrown out with the bath water”. But tough, um, cookies, anyway. All in the name of Commission Protectionism.

I do, though, find ironic humor in an initiative put forth by the “HOMEOWNERS” Club which is clearly AGAINST HOMEOWNERS (and potential homeowners), in favor of its member/agents (www.hca-il.com).

On the bright side, the IAR has officially adopted a motion to oppose the Bill. Among the concerns it has expressed are:

“1) The bill seeks to prohibit a legitimate marketing tool that REALTORS may wish to use as part of their business plan;
2) The bill places REALTORS at a competitive disadvantage versus other marketers of homes who would be able to offer cash rebates or incentives, such as homebuilders;
3) The bill gives the appearance that this is an attempt to stifle competition in the marketplace, to the detriment of the consumer;
4) The bill will invite claims by the U.S. Department of Justice and others that Illinois is attempting to fix the cooperating broker’s commission and to create a non-competitive environment.”

So, they do seem to get it. Hopefully, by Thursday, most of the House will…

By: Mark Reitman

Mark Reitman — Fri, 15 Feb 2008 20:26:19 +0000

Re: Above – Oops! The 21st. This spring fever must be getting to me. After all, it is up into the 20′s here.

By: Mark Reitman

Mark Reitman — Fri, 15 Feb 2008 20:23:54 +0000

For those interested, here’s an update on HB4313:

It was assigned to Judiciary I Civil Law Committee, on Wednesday. There is a hearing scheduled for next Thursday, the 24th, on the Bill.

Besides the IAR’s stated opposition, the Department of Justice has voiced its own strong opposition, as have multiple consumer groups, including the AHGA and CFA…