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Ads to Tell Details of Firm's Offer to Buy Unsold Homes

October 30, 1985|BILL RITTER | San Diego County Business Editor

SAN DIEGO — Electronic Realty Associates (ERA), with 1,700 real estate franchise operations nationwide and nearly three dozen in San Diego County, was charged by state officials Tuesday with failure to disclose "significant" limitations and conditions to its advertised "Seller Security Plan."

The state Attorney General's Consumer Law Section announced the charges as part of a settlement agreement with Kansas City-based ERA, which agreed to disclose several restrictions in its "If we don't sell your house, we'll buy it" advertising campaign.

Without admitting any wrongdoing, ERA agreed to the settlement and will pay the state $15,000 in court costs and attorney's fees, according to Deputy Atty. Gen. Susan E. Henrichsen.

ERA agreed to disclose that the seller is required to pay a fee of 2% of the selling price to participate in the plan and that the price is determined solely by ERA; that the seller must buy another house to qualify for the plan, and that the house up for sale must be a single-family, owner-occupied dwelling in an urban location.

Previously, those disclosures were made only when prospective clients actually met with ERA representatives, according to Henrichsen.

The lawsuit and settlement were against the parent ERA company and none of its franchisees, Henrichsen said.

Franchisees typically don't advertise the Seller Security Plan on their own; the parent company handles most of the advertising, according to an ERA franchisee.

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