With the evolution of advertising today, from classified craigslist advertisements and website banner ads to social media posts and photographic displays, it is more crucial than ever that real estate agents and brokers follow their state’s advertising standards. A blind ad or advertisement is one in which the advertiser does not disclose their name in the advertisement. In this article, we’ll cover blind advertising, fiduciary duties connected to it, blind ad examples, and more!
What is a Blind Ad?
A blind ad or advertisement is one in which the advertiser does not disclose their name or license status in the advertisement. Real estate brokers and agents must identify themselves in all advertisements and include enough information to notify the public of their status as real estate professionals. Not disclosing license status is illegal in most states so its crucial agents understand the ins and outs of blind advertising.
A blind ad can come in many forms. It can be an ad with only a phone number or an ad with only an address. Either way, both examples do not reveal the person’s identity or license status who placed the ad – making it blind.
A fiduciary is a real estate professional who acts as an agent for a seller or buyer, typically through the execution of a written agreement. In plain terms, fiduciary duties are significant legal obligations these agents hold.
In addition to any duties or obligations outlined in a listing agreement or other employment contract, a real estate agent will owe some specific responsibilities to their principal as a fiduciary. By not advertising yourself on the ad, you are breaking the conduct of fiduciary duty as someone who can be trusted; this is called the duty of trust.
Are Blind Ads Illegal?
Most states have made it illegal for real estate brokers and agents to conduct blind advertising for various reasons. Property owners can use blind advertising but only if they are unlicensed individuals. In almost all cases, if a real estate agent lists a property, they must formally declare their identity and professional standing as a real estate professional in the advertisement.
In short, ads that would cause a reasonable customer to believe a property is for sale by the owner when a real estate broker is marketing it are often prohibited by authorities. Ultimately like many things in real estate, it is state-specific, so be sure to check out the laws of your state for the circumstances surrounding blind advertising.
Blind Ad Examples
Let’s say person A is seeking to buy a property and sees a sign for a home with just an address and a phone number. No name or organization is listed. They contact the number for person B, who is a licensed real estate agent, which they come to find that out later on as they go to see person C’s home. This would be blind advertising, as they did not know a real estate agent would be handling the transaction.
Here is a more textbook example: real estate agent Linda Smith wants to advertise in the local newspaper to get more clients. Linda lists her phone number and email address but only puts her first name and no information about her license status. This is an example of a blind advertisement because Linda did not include her last name or license status.
The Best Practices to Avoid Blind Ads
Real estate brokers, salespeople, agents, and professionals must have a comprehensive understanding of real estate advertising rules and restrictions. While each state does have different practices, many rules overlap. Thoroughly review these general practices for the real estate exam. On the exam, you should expect multiple questions about real estate advertising.
When creating a real estate advertisement follow these guidelines:
- Always state your brokerage’s name clearly and prominently.
- If it’s not possible to identify the brokerage name (for example, due to character count restrictions), just connect the electronic advertisement to a display that clearly and conspicuously displays the brokerage name.
- Always make sure you utilize the brokerage’s official name. There should be no abbreviations or nicknames used.
- If you are a broker use your full name in the advertisement, if you are an agent make sure to use your brokers full name in the advertisement.
What to Know for the Real Estate Exam
As a real estate professional, you want to make your name known. Advertising is one of the most common ways agents spread the word about their business to others. But, blind advertising can get agents into legal trouble.
For your exam and your career, remember a blind ad or advertisement is one in which the advertiser does not disclose their name in the ad. Real estate brokers and agents must identify themselves in all advertisements and include enough information to notify the public of their status as real estate professionals. Blind ads can breach your fiduciary duty of trust to your clients and result in the loss of your license.
The legalities behind blind advertising vary from state to state, so be sure to check the laws of your state regarding it. Remember, it’s best to be safe than sorry! When creating ads, always include your full name, brokerage, and contact information.