What is first substantive contact in real estate?

Depending on your region, understanding when “first substantive contact” occurs is crucial for maintaining compliance with agency disclosure laws. But first…let’s define the phrase:

What is “first substantive contact” in real estate?

This occurs when the interaction moves beyond casual or introductory conversation and begins to involve discussions about property, motivation, finances, or other significant topics that could affect decision-making.

The symbolism of this moment, is that in certain states, the agent may be required to provide transparency to the prospect regarding agency (ex: whom the agent represents) in order to protect both parties’ interests.

What’s the difference between first contact vs first substantive contact?

“First contact” involves any initial interaction, while “first substantive contact” refers to the point at which the discussion touches on the property, person’s motivation, finances, or other significant topics that could affect decision-making.

What states require disclosures at first contact and first substantive contact?

The requirements for agency disclosures that are required at first contact vary by state but this breakdown should help quickly find the right disclosure for your state.

First Contact States:

First Substantive Contact States:

First Business Meeting States:

Most other states require an agency disclosure at later parts of the relationship and/or transaction. See further below for a full list of states and the timing of first written agency disclosures.

Types of Agency Disclosures by State

Depending on the state, the agent may have to provide an agency disclosure form either in paper or digital form. We’ve got many examples of these forms in our post on Open House disclosures.

States like New York have a specific, legally mandated form that agents must present at this stage, clearly outlining the different types of agency relationships available. It’s an opportunity to explain to clients the roles and responsibilities linked to each option, whether the agent will act as a buyer’s agent, seller’s agent, or even as a dual agent representing both parties.

These forms need to be acknowledged somehow by the recipient. Many of these forms have a signature field that a prospect can sign to acknowledge they’ve received the disclosure BUT that’s not the only method.

By sharing the disclosure digitally using an app like Curb Hero, you can get a digital acknowledgement of these forms AND even get a downloadable digital version of the prospect’s filled out disclosure saved (and sync’ed with your CRM or document management solutions) for later reference.

If you haven’t tried Curb Hero yet, it’s a great solution for Open Houses and other real estate marketing.

Curb Hero Demo + Tutorial
Hosted by  Ajay Pondicherry
In this interactive session we will show you how to use Curb Hero’s FREE digital sign-in to save time, capture better data, and look amazing at your next Open House.

(note if you don’t see your state or brokerages disclosures available on our platform you can request new disclosures here)

There are other ways that many of states have recommended to collect acknowledgement that these disclosures have been received is to put the disclosure in the footer of an email to the prospect.

Though many of the legal departments for these states suggest that sending the email with the disclosure in the footer isn’t enough. An email reply from the prospect is what really counts as the acknowledgement.

That said, there are many interpretations so it’s best to check with your brokerage if unclear about this.

Agency Roles and Responsibilities that need to be explained at first substantive contact

Once an agent has identified the first substantive contact with a potential client, the next step is to clarify the specific agency relationship and associated responsibilities. Whether the agent is representing the buyer, seller, or both parties as a dual agent, it’s essential to explain the duties expected within each role. These key duties include confidentiality, loyalty, and fiduciary responsibility. By providing a clear description of these roles upfront, the agent helps the client understand the nature of their relationship and how the agent will act in the client’s best interests throughout the transaction.

For example, a listing agent at an Open House, is tasked with maximizing the seller’s return while also keeping confidential any sensitive information that could affect the seller’s position.

Timing of First Written Agency Disclosure Required By State

StateDisclosure Requirement
ALAs soon as is reasonably possible
AKWhen agent begins to provide specific assistance
AZAt the initial consultation meeting
ARBefore signing of sale contract
CABefore entering listing agreement (listing agent); before entering an offer to purchase (buying agent)
COBefore offering or negotiating to sell or buy
CTAt beginning of first personal meeting (buying agent)
DEEarlier of first appointment, showing of property, or offer
DCBefore providing specific real estate assistance
FLFor transaction brokerage, if shift from single agent; earlier of listing or rep agreement or property showing for single agent
GAAt time of agreement with agent
HIBefore sales contract presented
IDFirst substantial business contact
ILInitial contact with consumer
INBefore receiving confidential information
IAWhen agent provides specific assistance to the client
KYWhen drafting or presenting an offer
KSAt first practical opportunity
LAWhen substantive contact is made
MEWhen there is a substantive communication
MDUpon first contact
MAAt first personal meeting to discuss property
MIBefore disclosure of confidential information
MSAt first meeting with prospective client
MTWhen listing agreement executed (seller agent); when negotiations commence (subagent); when broker agreement executed (buyer agent)
MONo later than first contact or first showing of property
NHAt first business meeting
MNAt first substantive contact
NEAt earliest practicable opportunity or following first substantive contact
NVWhen an agency relationship is established
NJBefore consumer discusses motivation or desired sale price
NMBefore agent presents any written agreement
NYAt first substantive contact and before agreement
NCAt first substantive contact
NDAt first substantive contact
OHBefore showing property (listing agent); before discussing offer, financial info, other (buyer agent)
OKBefore sales agreement
OROn first contact
PAAt initial interview (oral if not in person with written form later)
RIEarlier of first personal contact or purchase offer
SCAt first substantive contact
SDBefore agent discusses consumer’s confidential objectives
TNBefore preparation of offer (buyer agent); before execution of listing agreement (listing agent)
TXAt first contact (orally or in writing)
UTIn written agreement for brokerage services
VTAt first reasonable opportunity and before discussing confidential info
VABefore specific real estate assistance is provided
WABefore signing an agreement with broker
WVBefore signing contract for representation
WIBefore providing brokerage services
WYBefore discussion involving sale
Source: Consumer Federation of America

In conclusion, understanding the concept of first substantive contact and its varying disclosure requirements across different states is essential for real estate agents to maintain compliance and foster trust with clients. While some states mandate disclosure at the very first contact or meeting, others align it with more in-depth interactions or specific agreements. These regulations ensure transparency and protect both parties by clarifying agency relationships before confidential or significant information is exchanged. By adhering to these guidelines and clearly communicating agency roles at appropriate points, agents can enhance professionalism, prevent misunderstandings, and create a foundation of trust and informed decision-making with their clients.

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