FAQ on Mandatory Placement of Lock Boxes
At the 2012 NAR Midyear Legislative Meetings & Trade Expo, the Board of Directors approved inclusion of the following new paragraph in MLS Policy Statement 7.31, Lock Box Security Requirements:
MLSs may, as a matter of local option, require placement of an MLS approved lock box on listed properties if any device giving access to real estate professionals and/or service providers is authorized by the seller and occupant and is placed on the property. The purpose of this requirement, if adopted by an MLS, is to ensure cooperating participants and subscribers have timely access to listed properties. Requiring that a lock box or other access device be “MLS-approved” does not limit the devices that satisfy the requirement to lock boxes leased or sold by an association or MLS. The MLS may require that the devices be submitted in advance for approval, and the access device may be any lock box or other access device that provides reasonable, timely access to listed property. The MLS also may revoke the approval and/or subject the participant to discipline if the device is used in a manner that fails to continue to satisfy this requirement.
These FAQ explain the update.
Q. When does the amendment to MLS Policy Statement 7.31 become effective?
A. Amendments to MLS policies become effective upon their publication in the following year’s Handbook on Multiple Listing Policy unless an earlier or later effective date is specified by the Board of Directors. This amendment will be effective upon publication of the 2013 MLS Handbook.
Q. Was MLS Policy Statement 7.1, Lock Boxes, also amended?
A. No. Because both MLS Policy Statements 7.1 and 7.31 addressed the same issues, and because MLS Policy Statement 7.31 is more current and comprehensive, MLS Policy Statement 7.1 was no longer needed and was deleted.
Q. Does the new provision require MLSs to sell or lease lock boxes to participants and subscribers?
A. No. Deciding whether an MLS will sell or lease lock box equipment to participants and subscribers remains a matter of local option.
Q. Are MLSs required to adopt rules requiring placement of lock boxes on listed properties?
A. No. MLSs may, as a matter of local discretion, adopt rules requiring placement of lock boxes on listed properties, subject to the conditions and limitations spelled out in Policy Statement 7.31.
Q. Can an MLS require placement of a lock box on every listed property as a condition of including that listing in MLS?
A. No. MLS Policy Statement 7.31 specifies the condition and limitations that must be part of any lock box placement rule.
Q. Under what circumstances can an MLS require placement of an “MLS-approved” lock box on listed property filed with the MLS?
A. Any lock box placement rule adopted by an MLS is limited to listed properties filed with the MLS where (a) placement of lock boxes or other access devices is authorized by the seller and occupant, and (b) where such a device has been placed on the property.
Q. If an “MLS-approved” lock box can only be required if there is already a lock box or other access device on the property, what’s the purpose of an MLS placement rule?
A. In some instances lock boxes or other devices giving access to real estate professionals and/or other service providers are placed on a property by individuals or entities other than the listing broker. Those devices do not always provide reasonable, timely access. Where placement of a lock box or access device is authorized, and where such a device is actually placed on the property, the MLS may, if it wishes, require placement of an “MLS-approved” lock box in addition.
Q. What does “MLS-approved” mean?
A. It means that the lock box or device will provide participants and subscribers with reasonable, timely access to listed property. The requirement that a lock box or other access device be “MLS-approved” does not mean that the lock box or access devices must be sold by, leased by, or otherwise provided by an MLS or by an association of REALTORS®. MLSs can require that participants’ lock boxes and other access devices be submitted in advance to the MLS to confirm their use will provide other participants and subscribers with reasonable, timely access to listed property.
Q. Some of our participants continue to use combination lock boxes. Others have digital doorknobs placed on them by REO companies. Do these devices meet the requirements for “MLS-approved”?
A. If the listing participant demonstrates the device utilized will provide other participants with reasonable, timely access to listed property, the MLS must “approve” them as meeting this requirement. For example, if a combination is required for access, the listing participant could be required to explain how other participants and subscribers will obtain the necessary combination or code. Methods of meeting the requirement could include inclusion of the combination or code in confidential “agent remarks” fields in the MLS, or the listing participant’s assurance that the combination will be provided by call back or electronically on a timely basis.
Q. A participant in an MLS lists a large number of institution-owned properties and uses the seller’s digital doorknobs for access. She publishes an “800” number for MLS participants to call for the code, but calls are not answered or are responded to several days later. Is this providing reasonable, timely access to listed property?
Q. What is “reasonable, timely access”?
A. While the NAR Board of Directors did not define “reasonable, timely access,” MLSs can, based on local custom and practice, establish objective criteria to determine whether access is reasonably available to other participants and subscribers. Any criteria used should be written, reasonable, objective, and consistently applied
Q. An MLS determined the lock boxes used by a participant do not provide reasonable, timely access to that participant’s listings. The seller will not authorize use of any lock box other than the one the listing broker has placed on the property. Can the MLS require use of an “MLS-approved lock” as a condition of the listing being published in the MLS?
A. Yes. If the seller will not authorize use of an MLS-approved lock box on their property, but permits placement of another lock box or access device, the listing is not eligible for inclusion in the MLS.
Q. May combinations or codes required for access to a participant’s lock box be published in confidential “agent remarks” fields in the MLS?
A. Yes. Making combinations and codes available to participants and subscribers through the MLS would meet the requirement. An MLS that does not allow participants to publish this information in confidential agent remarks fields or otherwise through the MLS may not find that the participant’s combination lock box is not “MLS-approved”.
Note: These questions and answers are advisory in nature, have not been reviewed or approved by the Board of Directors of the National Association of REALTORS®, and will be updated from time to time.