Back in October of 2003 in my “Who Can You Call?” column, I wrote an extensive review of the Federal Trade Commission implementation of a Do Not Call registry aimed at protecting consumers from annoying telemarketing calls.
This measure was, as one could expect, immediately challenged by the Association of Telemarketers and the Direct Marketing Association. They won a temporary victory by challenging the FTC rules on constitutional grounds. However, as their contest worked its way up through the court hierarchy, it was eventually found that the DNC registry was in fact legal.
The FTC rules were reinstated on January 1, 2005. The most significant change was a requirement that marketers “scrub” the Do Not Call list every 31 days and not call registered numbers. Previously, marketers had only been required to access the list on a quarterly basis.
Now, what does this mean to investors, as we try to contact troubled homeowners and help them resolve their problems. Are we selling anything? Are we marketers? Do we fall under the Do Not Call ruling?
Until we see legal cases argued in court, or amendments to the existing legislation, it is our personal opinion that investors without a real estate license are exempt from the Do Not Call rules. We are calling to offer free advice and assistance to help owners find ways to keep their homes when possible. We are not collecting a fee to stop their foreclosure nor are we solicating the owners to sell us their house.
We are not, however, attorneys, and do not offer legal advice.
Licensed Realtors on the other hand, according the National Association of Realtors (NAR) are barred from calling phone numbers on the Do Not Call list. Realtors like telemarketers, are required to access the DNC list every 31 days, and not call any registered numbers. The issue with licensed Realtors is that there in an implicit agency relationship when they call a homeowner. According to the NAR, the Realtors relationship is, in a way, the product they are selling (even if they are acting as a principal for their own account).
We consulted William Bronchick a prominent real estate attorney about this issue, and he felt that unlicensed investors would have no problem in calling troubled homeowners. It is Mr. Bronchicks’ opinion that such calls would be seen as personal calls – but he acknowledged that he was not entirely clear on the FTC position.
However if the Do Not Call Registry becomes an issue with unlicensed investors, a case agrued in the courts will be needed to clarify this question. In the meantime we should continue doing what we can to assist people in trouble whenever we can. Many will get to keep their homes, due to our free help. And for those troubled owners who cannot, they will have a chance to recapture some of their equity before the auction – rather than lose it all at the courthouse steps.
If you haven’t already read my original column, “Who Can You Call?” make sure you do so before you make your next call.
Happy investing, Alexis J
The foregoing has been prepared for informational purposes only and does not constitute legal advice.
The information is summary in nature and does not address any particular situation.
Readers should not act upon this information but should instead seek professional legal advice.
