Legal Matters: Q2 2025

Recent Resources from IAR's Legal Department

A recap of recent resources, updates and guidance from the IAR Legal Department

At its June 5th meeting, the NAR Board of Directors adopted a number of amendments to the REALTOR® Code of Ethics and Standards of Practice and made them effective immediately - so consider your current business practices and client interactions in light of the amended standards. In this video, IAR General Counsel Richelle Cohen Mossler summarizes the amendments and their impact:

Click below for an annotated guide to the June 5th amendments; you can also view and download the full current REALTOR® Code of Ethics and Standards of Practice here (via NAR).

In late June, IAR General Counsel Richelle Cohen Mossler teamed up with Senior Vice-President of Government Affairs Maggie McShane and Chief Operating Officer Kathy Harbaugh to explain several changes to Indiana law affecting real estate as a result of the passage of House Enrolled Act 1347; these changes became effective July 1st:

To briefly summarize the provisions of HEA1347 covered in the video - the new law:

Closes a loophole in state law by clarifying that brokerages must maintain trust accounts to manage earnest money and other client funds; however, this does not mean that third parties (like title companies) are prohibited from holding earnest money or other transactional funds, only that real estate brokerages must maintain trust accounts to offer consumers the option.
Increases the eligibility requirement to become a managing broker from two to three years as an active (licensed) broker as well as passing a written test developed and administered through the Indiana Real Estate Commission.
Requires the Real Estate Commission and the Professional Licensing Agency to conduct annual audits of Continuing Education.
Expands Indiana’s requirement for written buyer and listing agreements - adding “tenant” to buyer and “authority to lease” to authority to sell, so written agency agreements are required to represent lessees and landlords along with property buyers and sellers. (As Richelle mentions in the video, parties to a lease transaction are already included in IAR’s exclusive buyer agency and listing contracts, so existing legal forms continue to reflect Indiana law.)
Finally, two new conditions must be disclosed by the seller – if a property is located within a locally-designated historic district or a conservation easement. (The property owner still carries all responsibility and liability for disclosing known conditions or defects.)

In a 2023 survey of recent homebuyers, real estate marketing consultancy 1000Watt found that “interpreting inspection and disclosure reports” was ranked the most valuable service provided by real estate agents – buyers are looking to for expert help reducing risk and avoiding costly issues after moving day.

In this legal update, IAR Legal and Regulatory Compliance Counsel Anne Johnson provides a refresher on how (and when) clients can exercise their option for additional inspection if the initial report uncovers any potentially troubling issues.

In this update, IAR Senior Staff Counsel Kelly Shonborn warns that REALTORS® face legal risk if they list a property on behalf of a real estate wholesaler without proper authorization from the original owner – for example, if the wholesaler has obtained a power of attorney or sales contract by fraudulent means or without the proper legal disclosures.

Back in April, IAR General Counsel Richelle Cohen Mossler provided a refresher on key concepts and principles of Fair Housing law – which she rightfully notes must be a year-round commitment beyond Fair Housing Month. It’s well worth a re-watch, especially as the new NAR Fair Housing training requirement takes effect.

Speaking of the new NAR Fair Housing education requirement, IAR will be providing several opportunities for members to complete the necessary two (2) hours of training during the current three-year cycle (2025-2027). A new course, "The Impact of Fair Housing," is included in the new twelve-hour member benefit Continuing Education package available to all IAR members via RECP; these online, on-demand courses will be launched later this summer.

The 2025 Indiana REALTOR® Fall Conference also includes an opportunity to take the NAR Bias Override course on Tuesday, September 9th (the morning after the Conference), for three hours of Indiana CE and the Fair Housing requirement. Consider registering for the Fall Conference on September 8th in Indianapolis for the latest updates from the Legal Department as well as the Bias Override option:

IAR Senior Staff Counsel Kelly Shonborn tackles some questions about the IAR Exclusive Buyer Agency Contract. She explains the state requirement for written buyer agreements, when managing brokers should sign the contract (ASAP!), whether a broker from the same company may show a home on behalf of a broker with an executed agreement (yes) and how MLSs may go about enforcing the rules requiring an agreement before showing a home – and more. Check it out:

Each year, IAR’s Legal Department fields thousands of calls through the Legal Hotline as well as hearing directly from members at state and local association events and other forums. Earlier this year, the Legal Department released an updated compilation of common questions from the Legal Hotline, including revisions on buyer agency agreements, broker compensation and MLS rules. Click the button to view and download the PDF of this Legal Q&A Compilation: