As a professional real estate agent in the states of Kansas and Missouri I run in to compliance issues each and every day. With each new contract I write I hire a compliance coordinator to make sure that myself, my brokerage and my clients are protected by making sure all the i’s are dotted and the t’s are crossed. Did you know there are over a hundred different ways to make a contract inaccurate and therefore subject to being voided and/or being fined by the state in authority?
Property Management is another compliance nightmare. With so many forms to sign and initial and monies to be tracked and traced, there is always something that can be missed if you don’t hire another set of eyes to take a look. And, believe it or not, there may still be something that slips through.
With each new day the states seem to come up with yet another thing to ask for and to look out for. We were just discussing and lamenting an new requirement by the state of Kansas the other day.
Why this matters to you? Because you don’t want a contract voided or a fine paid, do you? Well, maybe you don’t care about the fine that agent and brokerage has to pay. But a contract being voided? You wouldn’t care for that.
And if you are a do-it-yourself landlord you better understand compliance, and the seven protected classes, very thoroughly. Miss a Lead Based Paint Addendum and see what that could bring you if the feds come snooping around. Disclosure? Make sure you disclose what you know. And the seven protected classes? I hear landlords brazenly say they don’t let “this or that” in to their houses. Well, that’s a lawsuit just waiting to happen.
Compliance is necessary because of the ever increasingly litigious society we live in. Nothing is ever anybody’s fault any more and the lawyers always go where the money is whether there is basis in fact or not. (Usually it costs you more to win than to settle, and the lawyers know this.) Property means assets. The lawyers and their clients want what you have. Learn to protect it.
Okay. So I told you the Missouri auditor had arrived. My sales files are all okay. My property management files, on the other hand, were a real headache. First, there was the comedy of errors. See, I use a professional software package for my property management (No, I’m not looking to manage more properties. Just mine and the five other doors I have is plenty, thank you.) and it has a lot of accounting practices contained therein. Problem is, neither I nor the auditor is an accountant.
You might say you’d have figured it out right away. And I probably should have. But with an auditor sitting there asking questions about a financial software program I use that I barely even understand (it just works!) I did get a little flustered. Which, is kinda funny really. I spent years in DC as a private investigator. I’ve been shot at. I’ve met Senators and Congressmen. I’ve testified in court so many times it’s not countable. Yet, here I was a little frustrated and nervous.
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