Does anyone know of any state that outlaws participation in preferred vendor lists?

[Nick Gromicko]

If anyone knows of any law that prohibits inspectors from participating in preferred vendor relationships, please post here.

[James H. Bushart]

I was told that Texas prohibited it, but I am not sure.

[Bruce A. King]

NC is one.

[Stephen W. Stanczyk]

Washington. WAC 308-408C-020

" (9) Not provide compensation, inducement, or reward directly or indirectly, to any person or entity other than the client, for the referral of business, inclusion on a list of recommended inspectors or preferred providers or participate in similar arrangements. The purchase and/or use of low-value advertising or marketing services or products that does not exceed ten dollars per item, is not considered inducement or reward.

[Nick Gromicko]

I'm doing a TV interview in Dallas tomorrow morning discussing this matter.

[prichardson]

Originally Posted by bking

NC is one.

What he said!
From the NCHILB
QUESTION:

Can a Home Inspector affiliate with a real estate company as a “preferred partner”, “bronze”, “silver”, or “gold” status, etc., or other forms of “partnership” in magazine articles, printed brochures or via website links?

ANSWER:


Consider the ethical implications stemming from the above arrangement. For a fee, home inspectors and others can be listed in the various categories. The more the inspector pays, the more benefits they get in terms of the prominence of their ad, and other ancillary benefits such as the right to do presentations at the realty office. While the contracts that are signed may state at the bottom “that the advertiser is not a paying for business but for advertising”, it does not appear that it would be clear to the real estate company’s clients (general public) that the realty firm is not endorsing or recommending Home Inspectors who participate in such a “partnership” without an explicit indication it is a paid advertisement.
NCAC [Rules] .1116 CODE OF ETHICS (e), states no licensee shall accept or offer commissions or allowances, directly or indirectly, from other parties dealing with the client in connection with work for which the licensee is responsible.
The Board believes that participating in such an ad relationship would be a violation of the Code of Ethics. If a home inspector pays a realty firm to have a printed ad, or an internet ad on the agency website, in order for the home inspector to avoid violating the Code of Ethics, the ad MUST clearly and prominently state, “This ad has been purchased and paid for by this Home Inspector.” If the ad does not make such a statement, the Home Inspector buying such an ad is in violation of the Code of Ethics. The effective date of this ruling has been established as May 1, 2009.

[Chuck Evans]

Originally Posted by jbushart

I was told that Texas prohibited it, but I am not sure.

That's affirmative for Texas.

From REAL ESTATE INSPECTORS
RULE §535.220 Professional Conduct and Ethics

(3) An inspector shall not pay or receive a fee or other valuable consideration to or from any other settlement service provider for, but not limited to, the following:

(A) the referral of inspections;
(B) inclusion on a list of inspectors, preferred providers, or similar arrangements; or
(C) inclusion on lists of inspectors contingent on other financial agreements.

In this section "settlement service" means any service provided in connection with a prospective or actual settlement, and "settlement service provider" includes, but is not limited to, any one or more of the following:

(A) Federally related mortgage loan originator;
(B) Mortgage broker;
(C) Title service provider;
(D) Attorney;
(E) A person who prepares documents, including notarization, delivery, and recordation;
(F) Appraiser;
(G) Inspector;
(H) Settlement agent;
(I) A person who provides mortgage insurance services;
(J) A person who provides services involving hazard, flood, or other casualty insurance or homeowner's warranties;
(K) Real estate agent or broker; and
(L) A person who provides any other services for which a settlement service provider requires a borrower or seller to pay.

There are no similar restrictions on agents/brokers

[James H. Bushart]

Originally Posted by gromicko

I'm doing a TV interview in Dallas tomorrow morning discussing this matter.

Is this part of the arrangement we discussed a couple of months ago, or something new?

[Dan Bowers, CMI]

I'm told that a couple of BIG Texas inspection companies pay Over $7500 per year to be part of certain RE companies preferred list SO there must be a way they skirt around it OR .........

Remember the posts 3-4 years ago on here where several ASHI members in Omaha were getting press coverage for doing that. Never heard ANYONE get their weinies smacked over that.

Seems it was just an ADVERTISING payment.

[Nick Gromicko]

Jim asks:

Is this part of the arrangement we discussed a couple of months ago, or something new?

Part of that arrangement.

Dan writes:

Remember the posts 3-4 years ago on here where several ASHI members in Omaha were getting press coverage for doing that.

Correct. Part of my interviews explain how a consumer can check the ASHI website to find the entire list of potentially unethical inspectors to avoid.

[Richard Fitzwater]

I have been offered "advertising space" on the Realtor handout. This way they are not referring you....lol. Total BS!

I declined to have anything to do with those offices. That makes a mockery of the home inspection business.

They generate a lot of money for the Realtor office.

[Nick Gromicko]

Real estate agents have a fiduciary duty their clients (just like attorneys do). Can you imagine if an attorney's advice to his client varied wildly, depending on what secret third-party was paying to buy ad space on the attorney's website?

[James H. Bushart]

Any chance of you getting a tape of your interview and broadcasting it on NACHI TV? I'd love to see it.

[Gary Farnsworth]

http://www.kslegislature.org/bills/2010/2260.pdf


I have been offered several times to advertise in offices, all for a fee. In 2008 I paid $300 to "advertise" in Keller-Williams red book. They did not call me for 2009 or 2010. Contractors, mortgage lenders, warranty companies, termite and radon companies all do it; why can't we?

Because agents want us out of the way (business) because we write reports that will scare their buyers, then the buyers walk away from deals, then agents lose money.