Love Letters or Liability Letters? Protect Your Buyers and Sellers from Fair Housing Violations
Buyer love letters are a tactic used by some buyers in an attempt to stand out to a seller, especially in hot markets with low inventory and bidding wars. Seemingly harmless, these letters actually raise fair housing concerns, and could open real estate professionals and their clients to fair housing violations.
To entice a seller to choose their offer, buyers sometimes write “love letters” to describe the many reasons why the seller should “pick them.” While this may seem harmless, these letters can actually pose fair housing risks because they often contain personal information and reveal characteristics of the buyer, such as race, religion, or familial status, which could then be used, knowingly or through unconscious bias, as an unlawful basis for a seller’s decision to accept or reject an offer.
Consider where a potential buyer writes to the seller that they can picture their children running down the stairs on Christmas morning for years to come in the house. This statement not only reveals the potential buyer’s familial status, but also their religion, both of which are protected characteristics under fair housing laws. Using protected characteristics as a basis to accept or reject an offer, as opposed to price and terms, would violate the Fair Housing Act.
If a letter is sent to the seller, it should never include pictures of the buyer or the buyer’s family. What can be done in a letter is write about the property itself or its characteristics. For example, “We love the house’s exterior and the garden and would take good care of it.” It is best, however, not to send a letter at all.
Best practices to protect yourselves and your clients from fair housing liability:
Source: National Association of Realtors
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