The meaning of “free” – a semantics lesson courtesy of the CAR rule
This article casts a critical eye on the California Association of Realtors’ (CARs’) disingenuous claim that their forms are “free.” Can something truly be free when you’re paying through the nose for it?
Semantics, nothing more than language games
The California Association of Realtors (CAR) has a quirky sense of language.
In 2002, CAR began bundling access to their zipForms (then branded as WINForms) with their membership dues. Prior to this, CAR’s library of forms was sold separately, both in the digital format and in printed pads frequently made available at local Association of Realtors (AORs). Thus, what was once an independently available good was folded under the umbrella of membership – “bundled” in anti-trust vernacular.
And how did CAR describe this little switcheroo? Once the forms were bundled with membership, CAR started using an intentionally sneaky term to describe this change in MO – “free.”
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When the seeds were sown
“Free” is a term bandied about quite liberally by advertisers, politicians and the vox populi. It means different things in different contexts, such as enjoying political liberty, or not bound or constrained, or perhaps most commonly, not costing anything. This is how most in the English-speaking universe use this term.
And then there’s the CAR usage of “free,” meaning: subsidized by an across-the-board increase in membership dues shouldered by all. Intentional, yes; planned and fully disclosed, also yes.
A little history lesson may be on order. CAR’s bundling of forms with membership coincided with another far-reaching policy: an increase of CAR membership dues. Instead of forms being paid for individually by brokers and supplied to agents for their use, the cost was disbursed across the membership of all CAR devotees.
But did this clever sleight of hand actually fool anyone? Believe it or not, it worked – for a while anyway.
Smoke and mirrors
This bundling of forms didn’t just happen overnight. Like most dastardly plots, the mechanizations were set in motion well beforehand (likely under candlelight by a cigar-smoking cadre of old white males speaking in hushed, dramatic tones about very serious business).
On August 1st, 2001, CAR released an Issues Briefing Paper titled WINForms Software in the Dues.
Editor’s note – Though once publically available, first tuesday is no longer able to access and link to a digital copy of this document. We base this writing off a hard copy of the Issues Briefing Paper our Legal Editor had the foresight to print and retain in 2001.
The Issues Briefing Paper discusses how the bundling of WINForms (now known as zipLogix) with annual membership will be implemented, and how the bill will be subtly footed by each and every one of its members for the benefit of CAR and undernourished AORs.
The Issues Briefing Paper presented four payment options which were considered by the upper echelons of CAR’s directors.
WINForms software could be added as a membership benefit at an increased cost of:
- $25 annually for each member;
- $33-$35 annually for each member;
- annually graduated costs of $18, $25 and $35 for each member; or
- annually graduated costs of $18, $25 and $35, paired with an additional revenue generating subsidy to cover potential losses at the local AOR level.
Editor’s note – Remember, these are in 2001 dollars. Adjusted for inflation, this is closer to the ballpark of $45-$50.
We at first tuesday are not privy to which payment option CAR ultimately chose. However, the commonality of all these options is patently clear: they all involve increased membership dues to pay for the access to forms. Further, this increase will be shouldered by everyone – even non-practicing members who don’t use the forms, or members who then used forms published by others, such as first tuesday.
Prior to 2002, CAR was entirely cognizant of fiscal effect of bundling forms with membership. In the Financial Impact heading of the Issues Briefing Paper, CAR notes it will incur:
- the cost of acquiring the WINForms software;
- ongoing product support costs; and
- loss of profit on the sales of forms.
Thus, CAR knew it would need to devise a strategy for turning a potential cash-sink into a full-fledged cash-cow.
How then can CAR continue to describe its forms as “free,” semantically speaking of course?
The aftermath
Now, over ten years after this dramatic transformation, this CAR handling has become the status quo, victim to the unquestioned we do it this way because that’s the way it’s always been brand of thinking.
With access to forms being the only tangible CAR benefit, most hardly bat an eye when it comes to “free” forms. This much is clear: CAR accomplished one leg of its stated goal. It did include WINForms software as part of membership benefits – but at a hefty increase in dues for value received.
Its goal of “free” forms never materialized. However, the illusion of free did.
And as far as CAR is concerned, isn’t the illusion of free better than the real thing?
Have no bones to pick with FT, they seem competent and cutting edge.
I have to admit that the way this piece is written, it definitely comes across as a “hit piece” that is pure “sour grapes”. I am not privy to CAR’s budget, but I enjoy the on-line platform for all of our forms, as well as the instantaneous legal advice that I get as a member broker.
If FT wants to make their case, they need to do it with logic, not painting conspiratorial and dramatic images, in an attempt win popular support. As it is, it just comes across as being self-serving.
This is for Andy Anderson: Do you have a “supra key” (or whatever it is now) with the MLS Only CAR membership? The 3 things I consider most vital in this business:
1. MLS access to listings, searches, comps, agent info, commissions, etc. so you don’t look like a schmuck with printouts from sawbuck, trulia, zillow, and redfin
2. Key access to view property.
3. Current and up-to-date forms for real estate transactions.
I’m also a mortgage broker so I would also need to have the NMLS # — yet another fee, shocking…
Andy Anderson,
first tuesday already has published Form 158, Purchase Agreement – Land Acquisition Transaction and Form 159, Purchase Agreement – Other than One-to-Four Residential Units – Income Property, available for download with your first tuesday course enrollment or Annual Membership subscription.
We are currently developing an agricultural property purchase agreement form, which will be available soon. If there is a specific type of form (or type of provision not currently included in our forms) you would like, please let us know. We are always looking to develop new resources for our students and subscribers.
Thank you for your feedback!
Editorial Staff
As usual First Tuesday continues to stay within the forefront of Real Estate business, or How *#$! happens. Recently I submitted a First Tuesday Counter-Offer form after admiring its simplicity and factual content. The Transaction Coordinator contacted the Sales Manager , who notified the Broker , then requiring me to us a CAR form. “I asked why? Tuesday’s form is legal.” The reasoning became complicated. After continuing to ask “why?”. Bottom line CAR/AOR/Broker rules. Ah! Understood. More in-line with First Tuesday, I think – “use em or lose em”.
One way or the other, this is better, than needing a “special form” and having to buy a whole pad, to do a professional job, Also, it saves, throwing away a pad of forms, when they are “revised” or updated. Through, 19 year, I don’t know how much money it cost me, when I had to throw the un-used pad. and purchase again, the newer vision of the forms. So perhaps, the word “FREE” might now have been the “best” term, to describe what the association did, however, it also, brought more “rouge” real estate companies into the fold, to use the latest forms with verbiage that covered the most urgent legal matters. I believe in this case the end justified the means. Not all forms, out there in the market place, are as thorough and legally correct, as First Tuesdays forms.
I have known first Tuesday to be reliable, trustworthy and up to date with their courses and real estate laws. I have full respect for them.
When you are dealing with softwares-that will always be updated and definitely will cost money and CAR will pass the bucks. Why not charge the brokers? After all they should provide some benefits to Realtors who are connected with them(Brokers). this should be part of their supports to their agents.
That’s my say about this matter. I completely agree with First Tuesday.
I cancelled my CAR, NAR and local board membership over 20 years ago (am MLS only). I do get flack from other agents for using the FT forms. Wish FT would come up with some new forms especially for land and commercial sales and listings.
Let’s hear it for Jill Mack. There is too much whining going on here. First Tuesday has been my “association” since the mid-80s although I still maintain a good working relationship with our local BOR. Just a few times in all these years have my use of the FT forms provided any cause for hesitation by an AOR member.
I’ve always felt FT was superior, not because they said so or blasted the BOR, but because they DIDN’T behave that way. They simply provided a good professional service at a good price and didn’t badmouth the competition.
First Tuesday, get over it.
I am so irritated by the local association, that I have elected to not remain a Realtor. This is just one more example of the true “Ethics” of the association.
they will not get my money any moreeee!
not only they over charged, but to login threir website is pain on the but, wasted of time, the legal line of attornys, answering not to good nither, but it’s free..bs
members service 2 class , does any bady needs that BHGLAAR I dont !
Yes, I agree! Although I am proud to said that I am a Realtor, their fees are too high and the benefits, aside from accessing their “Free Forms” zip forms, are none, at least for me. :( Thanks for airing our voices…