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Take Members to a New Level

Risk management is consistently cited by Realtors® as a key business concern. That’s why to help our members better manage their risk, the San Diego Association of Realtors® created a comprehensive, custom education program, the Risk Management Specialist (RMS) certification. (Editor’s Note: The certification is neither affiliated with nor endorsed by NAR.)

The Evolution of a Program
Our legal department oversees professional standards, a risk-management committee, and a real estate mediation center. The common ground in all three areas is complaints and lawsuits. The question we asked ourselves was, how do we share our experiences and lessons with members so that they don’t make the same mistakes others have made?

Our answer was RMS, a cutting-edge certification created to help Realtors® enhance their industry knowledge, execute better transactions, and reduce their exposure to risk.

We started with the development of “Conquering Contracts,” a 19-hour class that walks members line-by-line through the transaction contracts in a residential purchase. The course covers listing and buyer agency agreements (including which one to use and why), the purchase contract, and required disclosure forms. The course also includes a discussion of current real estate law and the standards to which Realtors® are held accountable. Having established a core class, we moved into the development of special-focus courses (see “San Diego’s RMS Certification: The Courses”).

Our instructors are attorneys who specialize in defending real estate practitioners. The special expertise of our instructors is invaluable, because participants can feel confident that what’s being taught is essential for doing business.

Creating Your Own Program
If you’re interested in creating a similar program, begin with a simple plan. Analyze what members need in the real estate transaction to successfully accomplish their business. Ask the staff of your legal or professional standards department to talk about their understanding of members’ expectations and what gaps exist in your training. Find a unique angle for your offering, and research your market to be sure there aren’t similar offerings from other organizations. You might even want to survey your members to gauge their interest.

Find out what resources are available locally. Do you have credible and knowledgeable real estate attorneys who serve your community? What about large-company real estate legal counsel? Meet with these experts and talk about the research you’ve done and your goals for the course. Negotiate with them to draft a course for the association’s use. Expect to pay them for both drafting and teaching the course. However, your association will own the course, and as you further develop your risk management program, it’ll become one of your association’s core services.

Limit class size to no more than 50–60 attendees. Any larger, and you compromise the learning environment and make it challenging for attendees to get to know one another.

Show Members the Value
If you build it, your members will come. Practically every state has education requirements for license renewal, so do the work necessary to get your course approved for continuing education credits. Members will beat a path to your door to take a course that’ll help them reduce their risk and fulfill their CE requirement. We introduced “Conquering Contracts” three years ago, and the course is sold out every time SDAR offers it.

The full RMS program was introduced two years ago, and we decided to make it a membership program. Any SDAR member can take “Conquering Contracts,” but to continue with the other courses, members must buy into the concept of taking their business to the next level by joining RMS. RMS membership provides forms, books, alerts, open-house presentation binders, transaction folders, and discounts on certain risk management products offered through the association store. We even negotiated with an E&O carrier to offer a discount to brokers who have RMS members working in their brokerage. The E&O discount has become an important element in promoting the value of the program.

In our second year, we have almost 200 RMS candidate members, and 40 members are “graduating” after the rigorous program.

Update, Update, Update

Your program should make it easy for members to not only learn about risk management but also revisit and reinforce what they’ve learned. We allow any RMS member to return to and audit any course for a small fee.

There’s also required continuing education for RMS members. To maintain their RMS certification, members must repeat courses as they’re updated and take courses that are added to the program as it evolves. Remember, real estate laws and standards of practice change, as will the content of your courses. Your members can’t remain at the top of their game if your association doesn’t fine-tune its course offerings to reflect those changes.

Ultimately, you want to design a program that helps your members excel and communicates to them that you care about their welfare and are taking an active role in their achievement.
If you’re interested in developing a risk-management program, contact the San Diego Association of Realtors® Legal Department. To learn more about SDAR’s RMS program, as well as other risk management products, attend the “Risky Business” forum at the April 2006 AE Institute in Reno, Nev.

San Diego’s RMS Certification: The Courses

Conquering Contracts—This course covers the intricacies of real estate contracts, including the residential purchase contract and commonly used addenda.

Pricing a Property and the Rules of Marketing and Advertising—Covers laws that govern marketing, advertising, and solicitation; the forms used; and the Realtor® Code of Ethics.

Get Acquainted with Other Contract Forms—Details forms used in other types of sales—including vacant land, income property, and probate.

When in Doubt . . . Disclose, Disclose, Disclose—Covers current disclosure requirements and trends.

Buyer/Seller . . . Landlord/Tenant—Details fair housing law, disclosures required of owners and landlords, and unlawful detainer actions.

26 Ways to Avoid Lawsuits—Details the latest laws affecting real estate, including case law and state and national requirements.

Negotiations—How to handle difficult negotiations with clients and other practitioners.

Red Flags—Understanding and conveying information on termite reports, disclosure reports, and title reports.

Realtor® Quadrennial Code of Ethics Training

Tiffiney A. Welles is the vice president of legal affairs for the San Diego Association of Realtors®.

Look Before You Leap Into Custom Courses
If you’re considering creating a custom course, think twice. Custom courses are expensive, and they may not be necessary, says Bruce Moncrieff, owner of LearningWorks, an instructional design company in Oak Park, Ill. “The only reason to do a custom course is to communicate issues that are unique to the population an association serves,” says Moncrieff. “Those tend to be legal issues or issues related to the demographics of an area.” Other words of advice:

Adapt what’s out there. Scour the marketplace to see what’s already available. In most cases, Moncrieff says, you can “semi-customize,” taking an existing course and inserting local examples for your audience. “An analogy would be ‘Pimp My Ride,’” says Moncrieff, referring to the popular TV show in which car enthusiasts customize cars with such frills as musical car horns, refrigerators, and even fish tanks. “In the show, the person brings in his used Pinto, and the team spiffs it up,” he says. “The hardware and engine are already there, and the car is just customized for a particular owner.”

Use an instructional designer. “It’s been my experience that when local and state associations do a customized program, they ask their best instructor to write the program,” he says. “That can become counterproductive, because instructors teach things they’re good at teaching; their courses may not be easily delivered by somebody else with another style or methodology.”
Moncrieff recommends hiring an instructional designer who has no stake in teaching the course. “That’ll ensure that the learning styles of everyone in the class are being addressed,” he says, “and a good instructional designer never loses track of the goal of the program.”

Seek out an instructional designer who understands your audience and knows what you want students to walk out of the classroom and do. The behavioral objective shouldn’t be subjective, says Moncrieff. “A designer shouldn’t say the objective is for students to walk out of the class ‘appreciating diversity,’” he says. “A good course designer knows this.”

Call in subject-matter experts. An instructional designer will create learning objectives and then meet with experts in the topic to learn how they’ve dealt with particular situations in the past, such as how they’ve handled particular contract provisions. Having talked to the subject-matter experts, says Moncrieff, the designer can put together a course that will encourage participation and achieve the learning objective.

Determine costs upfront. A rule of thumb, Moncrieff says, is that it takes about 50 hours of work, at about $100 per hour, to create a one-hour course. So a two-hour course would cost a minimum of $10,000. It’s less expensive to tailor an existing course. Moncrieff estimates that could be done for $1,000–$5,000, regardless of the length of the course.

In the end, Moncrieff says, “don’t try to reinvent the wheel. Your time, energy, and money are better spent on other things.”
—G. M. Filisko

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