Effective March 1, 2012: FTC’s Business Opportunity Rule
Brokerages or brokers, who solicit sales associates, may need to comply with the Federal Trade Commission’s Business Opportunity Rule (BOR). Effective March 1, 2012, the BOR requires sellers of business opportunities to provide a one-page disclosure to prospective buyers. The rule essentially defines a “business opportunity” as a commercial arrangement in which: (1) a seller solicits a prospective buyer to enter into a new business; and (2) the prospective buyer makes a required payment; and (3) the seller represents that the seller or another designated person will: (i) provide locations for the use or operation of equipment owned or controlled by the buyer; or (ii) provide accounts or customers to the buyer; or (iii) buy back goods or services the buyer produces or provides.
The required disclosures must be provided at least seven days before the buyer signs any contract in connection with the business opportunity sale or makes a payment or provides other consideration to the seller, and it must be provided in the language in which the sale is conducted. In addition, misrepresentations and omissions are prohibited.
If compliance with the BOR is required, the brokerage or broker should closely review the disclosure requirements and work with legal counsel when making the disclosures, as failure to comply can result in severe penalties. To find out more about compliance obligations, read the BOR, read information from NAR, and download the required one-page disclosure in English and Spanish.
Mortgage Assistance Relief Services (MARS) Info Center
Update July 22, 2011: MARS update: Realtors exempt from rule
The following instructions and forms are available for those members who choose to make the MARS disclosures.
Florida Realtors Legal Hotline:
As always, Florida Realtors Legal Hotline attorneys are prepared to answer your questions during Hotline hours (Monday - Friday, 9 a.m. - 5 p.m.). Call 407.438.1409. Legal questions may also be emailed to the Legal Hotline. Members will receive a live callback from a Legal Hotline attorney.
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MAP Rule: Mortgage Acts and Practices - Advertising
This Final Rule prohibits any misrepresentation in any commercial communication regarding any term of any mortgage credit product; and imposes certain recordkeeping requirements.
Property Management
The Fair Credit Reporting Act has been amended.
Effective July 21, 2011, if you take action that requires you to provide a Notice of Adverse Action and the adverse action is based in whole or in part on a numerical credit score, you must now also provide the consumer a written or electronic disclosure that includes the following additional information:
• A numerical credit score;
• The range of possible credit scores under the model used;
• All of the key factors that adversely affected the credit score of the consumer in the model used, the total number of which shall not exceed 4;
• The date on which the credit score was created; and
• The name of the person or entity that provided the credit score or credit file upon which the credit score was created.
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