- Love letters create the potential for sellers to deny an offer based upon the prospective buyer being in a protected class, which would violate fair housing laws
- Buyers should be discouraged from writing letters that include protected class information
- Sellers should be strongly discouraged from reading or using any letters that include information regarding a prospective buyer’s protected class status to decide how they accept or reject an offer
- Help buyers consider alternative ways to make their offer more appealing to the seller other than using love letters that disclose protected class status
- Encourage sellers to consider rejecting all love letters that contain information regarding the prospective buyer’s protected class status. Have sellers seek legal advice if they choose to review such letters
- All offers should be evaluated solely on the terms of the offer, i.e., price, contingencies, closing dates, etc.
Risk tip for listing agents: Be sure to keep a record of all the offers that your seller-clients receive, and document their objective criteria for evaluating them, and subsequently accepting or refusing them.
What to do when you receive love letters
Despite your efforts to educate clients and prevent buyers’ agents and facilitators from sending them, some love letters will inevitably land on your desk. So, how do you handle them?
Minnesota law and the Code of Ethics obligates you to provide all offers to your seller clients. Generally, a love letter is likely not considered a part of the offer. However, that will depend on the letter. You should consult with your seller-client at the time of the listing contract to determine whether the seller wants to receive any letters outside of the offer itself.
Given all the risks, even the most carefully written love letter can reveal personal information that could potentially bias the seller. By discussing all the issues upfront at the beginning of your relationship with the client, you can protect them and yourself from legal jeopardy.
Love letters and their perils
Love letters can breach the boundaries of the Fair Housing Act in many ways. Here are a few examples of letters that could potentially bias a seller’s decision.