The Arizona REALTORS® will release seven (7) revised forms on or about November 1, 2024, but all include only minor changes.  One (1) form has been removed from the Arizona REALTORS® library of forms, and one (1) new flyer has been created and placed in all Arizona REALTORS® forms platforms. The changes are as follows:

I. BROKER COMPENSATION IS NOT SET BY LAW AND NEGOTIABLE

Five (5) forms were revised to emphasize that broker compensation is not set by law and is fully negotiable.

Per the National Association of REALTORS® practice changes, pre-closing disclosure documents are required to disclose in conspicuous language that broker commissions are not set by law and are fully negotiable.  In August 2024, NAR advised that this practice change should be interpreted broadly and that the language should be included in any document that may be considered a pre-closing disclosure provided by a broker.  The below five (5) forms were thus revised to include verbiage that broker compensation is not set by law and is fully negotiable:

• Consent to Limited Representation- A redline version can be found here.

• Disclosure of Buyer Agency and Seller Waiver and Confirmation- A redline version can be found here.

• Real Estate Agency Disclosure and Election- A redline version can be found here.

• Unrepresented Buyer Disclosure- A redline version can be found here.

• Unrepresented Seller Compensation Agreement- A redline version can be found here.

II. SELLER FUNDS TO BUYER BROKER MAY BE CREDITED TO BUYER

Two (2) forms were revised to again disclose to the seller that funds paid to a buyer broker may be credited to the buyer. 

When a seller enters into a listing contract, they acknowledge that the compensation they pay to a buyer broker may be credited to the buyer.  (e.g., Residential Listing Contract Exclusive Right to Sell/Rent at lines 59-60).  However, sellers may not remember, or may misunderstand, that such a credit could occur when ancillary forms state the funds will be used for broker compensation.  The below two (2) forms were thus revised to include verbiage to reiterate that buyer broker compensation may be credited to the buyer in whole or in part:

• Compensation Agreement Between Brokers- A redline version can be found here.

• Seller Compensation Addendum- A redline version can be found here.

III. REMOVAL OF ONE FORM

The Additional Compensation Consent form has been removed from the Arizona REALTORS® library of forms.  The form provided consent from a buyer and seller for a broker to perform additional services for a fee.  However, the Risk Management Committee felt the form may be misused to increase broker compensation in violation of the practice changes and therefore withdrew it.

IV. BUYER REPRESENTATION AGREEMENT FLYER

Finally, a new Buyer Representation Agreement Flyer has been drafted.  The flyer can be provided to a potential buyer to help explain what a buyer representation agreement is and why the buyer is being asked to sign one.  The flyer is inviting, easy to read and emphasizes the value a REALTOR® provides to buyers.  It will be available in the forms library alongside the Buyer Broker Agreement to Show Property and Buyer-Broker Exclusive Employment Agreement forms on or about November 1, 2024.

Aaron M. Green, Esq., a licensed Arizona attorney, is the General Counsel for the Arizona Association of REALTORS®.  This article is of a general nature and reflects only the opinion of the author at the time it was drafted.  It is not intended as definitive legal advice, and you should not act upon it without seeking independent legal counsel.

Prior Form Revisions

The Arizona REALTORS® strives to keep its forms up to date as laws change or industry practice evolves.  Once released, the forms library contained on all Arizona REALTORS® forms licensing platforms is updated. 

Form updates are made to minimize your risk and ensure legal compliance. Don’t take a chance with outdated forms.  Prior Arizona REALTORS® form revisions (2014 – 2024) can be found at:  https://www.aaronline.com/2019/05/20/form-revision-updates/