Buyer Love Letters – Do They Work? Are they Legal and Ethical?
Among the home buyer bidding wars “love letters” from home buyers quickly gained popularity. A love letter is a letter in which a buyer often tells a seller a little bit about themselves. They might also try to sway the emotions of a seller by saying something ab0ut how they envision their family at the home for holidays or how they love their gardens and can’t wait to take care of them. These letters seem harmless and full of good intention with the goal to convince a seller to choose a buyer. The letters make a transaction more personal rather than just numbers and terms. It makes the sellers feel like they know who is moving into their home and that it will be taken care of.
All of that sounds like a good thing, but buyers and sellers have to be careful. Love letters can often pose a risk to fair housing issues; So much so that the state of Oregon has now outlawed love letters. If a seller where to choose a particular buyer based on a protected class (race, family status, religion, etc), this would be a violation of fair housing. Even a seller choosing a buyer who has kids that are a similar age to the neighbors would be a prohibited. We’ve been advising sellers for a long time to just look at the number and terms and ignore the love letters to prevent any potential fair housing conflicts. Also, a seller is better off if they don’t let their emotions play a part of the transaction. I’ve seen sellers take offers up to $10,000 less just because of their emotional reaction to a love letter.
Buyers and Sellers should really be cautious in how love letters are used. I would expect we’ll see more states outlaw them in the future. For now, if a buyer can legally and ethically sway the sellers decision by talking about their flowers or boosting their ego about their interior design skills (without mentioning any hint of a protected class), it could be worth it to gain that edge over a similar offer.
If you plan to write a love letter along with your offer or if you are a seller that wants to read the love letters, reference this fair housing information. Please review the protected classes, and make sure you aren’t violating any fair housing laws.