HB 2550 Passed by Legislature

| June 10, 2021

Love Letters
On June 8, the Oregon Legislature passed House Bill 2550, which requires seller’s agents to reject communications written by potential homebuyers and given to sellers for the purpose of winning favor for their offer on the basis of an intangible connection separate from the merits of their offer.

Often referred to as “love letters,” such communications were targeted by the 2021 Legislature as potential sources of Fair Housing violations, and Oregon REALTORS® engaged the bill’s sponsors early on to ensure it would not be overly burdensome or difficult to comply with. Now passed, House Bill 2550 will be enrolled in Oregon Revised Statutes (ORS) 696.805.  It becomes effective January 1, 2022.

NAR has recommended against these letters since late 2020, but in the interest of supporting fair housing for all, Oregon moved to become the first state to make acceptance of these communications on the part of a real estate licensee acting as a seller’s agent unlawful.

In particular, the bill states that “In order to help a seller avoid selecting a buyer based on the buyer’s race, color, religion, sex, sexual orientation, national origin, marital status or familial status as prohibited by the Fair Housing Act (42 U.S.C. 3601 et seq.), a seller’s agent shall reject any communication other than customary documents in a real estate transaction, including photographs, provided by a buyer.”

Oregon REALTORS® will provide additional guidance and education as it becomes clearer how this law will be interpreted and enforced.

While compliance policies will need to be set by each brokerage, we recommend that real estate licensees (both seller’s agents and buyer’s agents) have a discussion about love letters with their clients at the beginning of the agency relationship and agree with their client in writing that love letters will not be developed, accepted or transmitted in any transaction. Seller’s agents can include in the MLS remarks that love letters will be rejected.

Want more info on tricky issues that come up in multiple offer situations?

Love letters tend to be more common in multiple offer situations. Oregon REALTORS® has developed guidance on multiple offer situations that can be found here.  We will also be hosting a webinar on dealing with multiple offer situations on June 28 at 11am.