There are many myths that exist in the practice of real estate by real estate agents. I'm going to deal with three that I believe cover the full range of a real estate deal: "Confidential" offers, "the rule of three" and requesting repairs by a licensed contractor in the BINSR.
Many realtors have been in a situation where at certain price points sellers get multiple offers. The myth is that all the offers that the seller gets are confidential. Where does this come from? Nowhere in the purchase contract does it say that "this offer is confidential" or "do not disclose the contents of this offer." With this myth planted firmly in their head, selling agents deal with the multiple offers by telling buyers' agents that they have multiple offers and please give us your "highest and best." But think about this logically. If you have a seller isn't your prime duty to get them the best price for their house? If so, wouldn't you want the buyers to know what the highest offer is so they know what to beat? Also, if you're the seller's agent, put yourself in the buyer's agent's shoes. Why would you offer $10,000 more when you only need to offer $5000 more? You need to know what the highest offer is in order to correctly counsel your client. Of course you cannot disclose anything to anyone without your client's permission but your counsel to them should be to allow you tell all the bidders what the highest offer is. You could add a caveat, with your seller's approval that you will only accept new offers in higher multiples of say $5000. But PLEASE keep the bidding going buy telling everyone what the highest offer is. As an aside, some bidder may request to see the highest offer to make sure there is one. You can redact out the name of the bidder if you wish before providing it. THERE IS NO SUCH THING AS AN OFFER BEING CONFIDENTIAL.
Many a client will ask their agent for referrals for different contractors to do work on the home. The myth surrounding referrals is that to avoid being sued you have to give three names when you refer a contractor. This fear of litigation, pervasive in the real estate industry despite the low number of agents actually sued, stems from what some call the doctrine of "negligent referral." First and foremost, THE DOCTRINE OF NEGLIGENT REFERRAL HAS NOT BEEN ADOPTED IN ARIZONA. It should go without saying that if you recommend a contractor to a client you must know that they are qualified, licensed etc. to do the work. Under the doctrine of negligent referral you would be negligent if you referred someone that you KNEW was not qualified to perform the requested work. So the way it would play out is, you refer your client to a contractor, the contractor messes up the work causing your client damage and they turn around a sue you for knowing that the person wasn't qualified. It is not enough that the contractor botched the job, they must also prove that you knew the contractor wasn't qualified. Common sense tells us that even if you give your client three names to pick from, or if you give them 100 names, if the contractor they select botches the job they can still sue you if the can prove you knew they weren't qualified. THERE IS NO RULE THAT YOU MUST GIVE THREE REFERRALS. You can give one name as long as you know the contractor is qualified, able, licensed etc. to do the work. Just make sure you don't hire any contractors for your client. The client makes the selection of the contractor, the client does the hiring and the client supervises any work done by the contractor. Even in the one case in West Virginia where they held a broker liable for negligent referral, the BROKER hired the contractor who messed up.
If you're buying a home that needs repairs don't you want a licensed contractor to make the repairs? Many a client makes this request to their agent when requesting repairs after the inspection period and providing the BINSR to the seller. The myth is that buyers cannot request that repairs be done by a licensed contractor under some theory that the purchase contract only says that the repairs must be done in a workman-like manner and that the BINSR cannot override the contract. RULE #1 IN CONTRACT LAW: THE PARTIES CAN .AGREE ON ANYTHING THEY WANT. Repairs by a licensed contractor ARE performed in a workman-like manner by definition so such a request is not outlandish. Some sellers may not want to spend the extra dollars that a licensed contractor might cost. In this situation the buyer's agent has a discussion with the seller's agent, something along the lines of "do you want to risk losing this buyer by not using a licensed contractor for the repairs?" or "ask your clients to put themselves in the shoes of the buyer, wouldn't they want a licensed contractor too?" Buyers can propose any terms they want to sellers and the sellers have the right to agree or not. THERE ARE NO RESTRICTIONS ON WHAT A BUYER CAN REQUEST. The key line on the BINSR allowing a seller to agree to using a licensed contractor to perform repairs is "Seller agrees to correct the items disapproved by Buyer pursuant to terms set forth herein and Section 6j of the Contract." The seller agrees to repair the "items" disapproved of "PURSUANT TO THE TERMS SET FORTH HEREIN..." The BINSR isn't changing the contract but if you want to wear a belt and suspenders you can write up and addendum stating that the repairs will be performed by a licensed contractor. Remember, some types of repairs and repairs over $1000 require a licensed contractor to perform them.