With more states, most recently Oklahoma, enacting minimum service legislation for brokers and agents as echoes of the licensing requirements of their states, some limited service brokers claim that pulling the state in is overkill.

The legislation is designed, say the state associations, to protect consumers who employ MLS-only listing services, that they may fail to understand that they won't be getting other services. Proponents of MLS-only listing services say that the consumers know very well what they are getting, and that it is the real estate industry that is looking to protect itself from commission erosion.

Some brokers argue that brokers shouldn't be forced to allow consumers to use the business-to-business cooperative that is the MLS to beat commissions down, nor should they be told by other brokers to schedule showings and negotiations with the seller. Brokers have the reasonable expectation that all inventory in the MLS will be represented by professionals, or otherwise they would do business with for-sale-by-owner sellers.

Others say that what matters is the consumer, and access to the MLS is what the consumer wants and should have, and that the real estate industry shouldn't be conspiring to make consumers pay more than what is necessary for brokerage services.

"There are people who are qualified to represent themselves in negotiations and there are many others who are not qualified to do so, just as all buyers need not hire a buyer's agent," says minimum service broker Corey Scholtka, "but, no matter what spin is put on it, mandating minimum services seems wrong."

Scholtka says he is performing a service to consumers by providing them with exposure to agents and their clients in the local MLS. He shares his "Best Practices" with Realty Times to show "just a few of the ways I am working to make life a little easier for my fellow Realtors who I depend on to show and sell my Limited Service listings," he says.

1. Never say anything bad about full-service: Many people need full-service and limited services are not for everyone! It may be suitable for the more experienced home seller, investors, appraisers, attorneys, and builders who all have the time and understanding to do much of the work themselves with the support of an experienced Realtor to back them up in case they need it.

2. Never list a traditional for-sale-by-owner seller. If a seller does not want to pay a customary co-broke of at least 2.0 percent (90 percent of my sellers choose my area's typical 2.4 percent or higher) then that seller will not waste my time and tarnish my reputation by appearing on my web site.

3. No FSBO signs allowed: As a former Buyers Agent, I understand how lousy it must feel to see a 'FSBO' sign in the front lawn of a listing that a cooperating agent shows to a prospective buyer... If my seller used to be FBSO then they must remove those signs ASAP. I provide my own yard signs which have my company name and Realtor MLS logos.

4. Support and stand behind the home seller: Don't stick the listing on the MLS and forget about it! If the seller is in need of additional services, do not allow them to force the cooperating agent to do the extra work, help the seller out or else require that they get an attorney (or tell the seller to pay more to those who do more work and authorize cooperating agents to ask for more for their additional efforts).

Says Scholka, "Realtors who sponsor "minimum services" legislation claim that they are representing the consumer by enacting rule changes which make low-service brokers provide mandatory negotiation services. Imagine a state law sponsored by Masons who want to require an all-brick exterior for every new home built? ...or how about restaurateurs sponsoring a new law that requires a soup, salad and dessert to be sold with every meal? This is the same type of ridiculous self-dealing that the Realtor Associations would fight in every state if it were proposed by any other industry!

"It is notable that the Wisconsin Realtors Association (license law task force proposal was approved by the board of directors in January) has adopted a legislative proposal which confirms that MLS entry-only services are legal and ethical with proper disclosure and consent by the client. Once enacted, the law allows consumer choice as well as free-market business choices to continue without significant change in services. Our state motto "Forward" has a new meaning, now that Wisconsin leads the nation with this example of Realtors making the right move."

Published: March 25, 2005

Use of this article without permission is a violation of federal copyright laws.