January 19

Love Letters or Liability Letters – Are Letters to Sellers Illegal?

So you find yourself in a bidding war over the perfect Charlotte, NC home for sale. Since you want to increase your chances of winning, you decide to write a love letter. But is it legal?

A letter to a seller is the buyer's way of explaining  why they should get the house. While they're not illegal in Charlotte, NC, they infringe on the Fair Housing Act. These letters often contain personal information that may lead to bias.

If you’re thinking of writing a love letter, then make sure to read about its legalities below.

What is a Buyer/Seller Letter?

A love letter is a buyer's way of telling the seller why they should pick them. 

Here, the buyer may narrate what they love about a  Charlotte, NC, house. Likewise, they may explain what their family plans to do in the home, and so on.

Are Letters to Sellers Illegal? 

Technically, “Buyer love letters aren’t illegal or in violation of any rule or regulation.” That's according to NC Realtors' general counsel Will Martin.

Some agents even encourage buyers to make one. 

That said, buyer love letters are deemed illegal in one state: Oregon. Recently, the state has passed HB 2550, which will be effective starting January 1, 2022.

In essence, this law prohibits the buyer’s agent from providing the seller’s agent with a love letter. It’s believed that the ‘heart-tugging content’ may make the seller favor one buyer over the other.

Charlotte, NC home for sale

Does Writing a Letter to the Seller Violate Fair Housing?

The National Association of Realtors® (NAR) believes that love letters pose a risk. 

They believe that they may infringe upon the Fair Housing Act. According to this rule, sellers should not discriminate against buyers based on their: 

  • Color or race
  • Gender
  • Religion 
  • Country of origin
  • Family status
  • Disability

Unfortunately, most love letters contain personal information that reveals ‘protected’ characteristics. The writer may not intend to do this, but they may be disclosing the data mentioned above. 

To make things worse, some buyers even include a picture of their family in the letter. 

For example, you may choose to write about how your kids will spend Hanukkah in the home. Even if you don't intend to, you're alluding to your family status and religion in your letter.

Such information may place bias on the seller's mind, whether consciously or not. Instead of looking at the price and terms, the seller may accept the offer because of the letter.

Say the seller is a Jewish family. They may lean towards the letter sender because they share their religion.

Charlotte NC Homes for Sale

Do Buyer Love Letters Work?

In most cases, yes. 

Take the case of Molly and Chris Ayala, a couple who wanted to buy a ranch house. They won the property in Baldwin, Missouri, not because of their offer - but because of their love letter.

In the letter, Chris described their situation. Molly was recently diagnosed with Multiple Sclerosis. They used to live in a third-floor apartment, which made her mobility an issue.

The couple detailed how it was easier for Molly to move around in the ranch house. They also loved their paintings that displayed their favorite animals.

Needless to say, it tugged at the sellers’ hearts. So even if the Ayalas were the second-highest bidders for the ranch house, they won it.

While there are many success stories, the results are not always favorable. 

As Nancy Braun puts it, “The letter can work somewhat. But cash is still king.”

She goes on to explain that sellers will find it hard to turn down a quick close offer. Such is the case for a buyer that doesn't require appraisals, repairs, etc.

However, if there are two equal offers, the seller may end up favoring the letter-writer more.

Real Estate Properties in Charlotte NC

Love Letters Can Backfire on the Seller

REALTOR®, Jenifer Garcia, once had an elderly couple who received a buyer’s letter. The writer said she fell on hard times. 

The seller, a kind-hearted elderly couple, decided to accept her offer. It was $25,000 lower than the highest bid, which they then turned down. 

Sadly, it didn’t turn out to be seamless like the Ayalas’ deal. The buyer had many objections that eventually placed the house in market limbo. 

Because of this, Garcia changed her approach to receiving love letters. Like Showcase Realty agents, she educates sellers about their drawbacks.

What Do You Say in a Letter to the Seller?

As Martin has mentioned, some jurisdictions have rules that prevent buyers from writing love letters. Given  the ramifications of writing one, though, you need to be extremely careful. 

According to Martin, it should be based on objective criteria - and the property’s features.

Likewise, he says that the buyer should avoid sending in photos or videos. 

More importantly, Martin cautions buyers against sending a letter together with the offer.

Homes in Charlotte NC

What Should You Do? 

The North Carolina Real Estate Commission (NCREC) recently released guidelines on avoiding liability from such letters. As such, you can expect your real estate agent in Charlotte, NC, to follow such recommendations. 

For Showcase Realty listing agents, it's all about seller education. They will inform you of the pitfalls of love letters and how it opens you  to criticism and liability. Instead, you will be encouraged to focus on the price and terms. 

In case they receive a letter from the buyer, they will refuse to forward it to you, the seller. 

In other words, no letters will be accepted as part of your Charlotte, NC home offer. 

As for buyer’s agents, they will advise against sending a letter. Additionally, as per the recommendations of NAR, they won’t help you draft or deliver a letter either. 

Instead, they’ll inform you of the market’s status and what you can do to improve your chances of winning.

Here are some of the love letter alternatives they’ll recommend:

A Multi-Offer Package

Rather than writing a love letter, Nancy Braun will assemble a package instead. It will include your credit score and the lender’s approval letter. These objective metrics are what sellers should be looking at, after all. 

Likewise, your agent will also include a letter from Showcase Realty. This document will detail their closing statistics. That way, the seller knows that a top real estate agent is facilitating the sale.

Charlotte NC Real Estate Properties for Sale

Thank You Letter

Instead of a love letter, Nancy recommends writing a letter thanking all involved.

As always, when writing a letter, keep everything objective.

Final Thoughts

While a love letter isn't illegal, it does have some ramifications. So before you write one, it's best to consult with Nancy Braun first. Her firm, Showcase Realty, is updated with the NAR and NCREC rulings. 

Likewise, if you're a seller, Nancy can help you out too. She can help protect your Charlotte, NC property from these 'liability letters.'


Charlotte Real Estate, Real Estate, showcase realty

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