The TAR Digest: The Membership Newsletter of the Tennessee Association of Realtors
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The 2-15-11 Newsletter of the Tennessee Association of REALTORS
Editor: Pug Scoville


CONTENTS
1. The Fate of Fannie and Freddie
2. SURVEY: We Need Your Opinion!
3. Volunteers …Step Up!
4. HOT LINE: Using 2010 Forms?
5. HOT LINE: Clarification of Advertising Rules?
6. HOT LINE: Agent Seeking Bonus Unethically?
7. Upcoming Events and Courses
8. Rates Pass the 5 Percent Threshold
9. Useful Web Links

To ask a TAR Legal and Ethics Hot Line question, CLICK HERE.

For other questions about this newsletter, please use the “CONTACT” form HERE.


1. The Fate of Fannie and Freddie

Reaction is coming in from the mortgage finance sector concerning the U. S. Treasury’s Feb. 11 white paper, which focused on the restructuring of Fannie Mae and Freddie Mac and their eventual phase out. Amherst Securities Group responded that the plans laid out in the white paper will not have a major impact. A statement read: “We do not believe this proposal will significantly affect the refinance ability of the bulk of the conventional MBS market,” adding that the net effect would be to make some of the jumbo product less refinanceable.

In responding to the proposal, 2011 National Association of REALTORS President Ron Phipps said: “Reducing the government’s involvement in the mortgage finance market is necessary for a healthy market, but should not be done at the expense of the economy or home buyers ….Any proposal for increasing fees and borrowing costs beyond actuarially sound levels will only make it harder for working, middle-class individuals to achieve home ownership, and only the wealthy will be able to achieve the American dream.”

To read the entire NAR response, CLICK HERE.

[SOURCES: Housing Wire; Information, Inc.; NAR]


2. SURVEY: We Need Your Opinion!

One of the TAR Executive Committee’s 2011 priorities is to increase the professionalism of the industry. The educational requirements for licensing in Tennessee are just one of the areas under review, and WE NEED YOUR INPUT! We really want every member’s opinion.

PLEASE take just a couple of minutes to answer a simple 5-QUESTION SURVEY at the following link: http://www.surveymonkey.com/s/TARMemberSurvey

The survey will close on Sunday, Feb. 20, and we’ll report the results in next week’s TAR DIGEST!


3. Volunteers …Step Up!

Are we really the “Volunteer State”? So far, the numbers don’t say so.

There are CRITICAL ISSUES on the horizon such as the GSE restructuring (noted above) and a fight to preserve the Mortgage Interest Deduction. Our goal is for EVERY managing broker in Tennessee to sign up with NAR’s Broker Involvement Program, but – to date – many if not most of our managing brokers haven’t done so!

NAR’s Broker Involvement Program empowers broker owners to alert their agents to key REALTOR issues. When brokers speak, agents listen and respond. By urging REALTORS to respond to NAR’s Calls for Action, we can shine a bright light in Congress on important real estate issues. The more agents that take action, the more Congress will know the voice of the REALTOR Party and will respond to our industry’s needs.

Brokers, we know you’re busy and this WON’T take much time! It only takes a minute or two to sign up, and you can do so by CLICKING HERE.

[SOURCE: NAR]


4. HOT LINE: Using 2010 Forms?

QUESTION: Are we required to use the 2011 TAR Purchase and Sale Agreement, or can we continue to use the 2010 form? If we use the 2010 TAR Purchase and Sale Agreement, will it affect our E & O insurance?

ANSWER: TAR only endorses the most current version of the forms. If you are not using the most current version of the forms, TAR will not be held responsible if a problem arises concerning the forms. You will use previous versions of the forms at your own risk. You will need to contact your E & O carrier to determine whether they have any rules concerning this.

[SOURCE: TAR Legal & Ethics Hot Line Attorneys]


5. HOT LINE: Clarification of Advertising Rules?

QUESTION: I have another question about the Real Estate Commission’s new rules. Under the Advertising rule 12-02-.12(3)(a), it says any licensee using a franchise trade name or advertising as a member of a cooperative group shall clearly and unmistakably indicate in the advertisement his name, broker or firm name and firm telephone number. I am a little confused by the wording here. It sounds like a person can advertise and not use the firm name as long as they use their name OR their broker’s name, which conflicts with Rule 12-02-.12(2)(b).

ANSWER: You are correct. The wording on this section of the Rule is a bit confusing. It would appear that an agent could list either the broker or firm name (in addition to their name and firm telephone number) when advertising property for sale if they are using a franchise trade name or as a member of a cooperative group. However, earlier in the rule as you noted, it states that “All advertising shall be under the direct supervision of the principal broker and shall list the firm name and telephone number.” TREC Rule 1260-2-.12(2)(b). THEREFORE, the firm name would be required. The broker’s name could be included as well, but the firm name must appear in ALL advertising.

[SOURCE: TAR Legal & Ethics Hot Line Attorneys]


6. HOT LINE: Agent Seeking Bonus Unethically?

QUESTION: I have a property listed, with X% commission offered in the MLS. An agent called me yesterday and said he had an offer from a buyer, but wanted a $1,000 bonus for making the offer. He put this term in the offer when he submitted it on behalf of his buyer. My seller refused to accept that term, marked it out and noted, basically, that the agent would be paid the X% commission offered. My fear is that the buyer’s agent will not show this counteroffer to their client based on the fact that the seller marked out the $1,000 bonus. What can we do in this situation?

ANSWER: This agent may have violated Article 16 of the NAR Code of Ethics, depending upon how the local board will interpret it.  Standard of Practice 16-16 states:

“REALTORS, acting as subagents or buyer/tenant representatives or brokers, shall not use the terms of an offer to purchase/lease to attempt to modify the listing broker’s offer of compensation to subagents or buyer/tenant representatives or brokers nor make the submission of an executed offer to purchase/lease contingent on the listing broker’s agreement to modify the offer of compensation.”

Granted, this is not the offer of compensation necessarily, but a request for a bonus. However, to ensure that your counter is presented, you can utilize a policy statement from the 2011 Multiple Listing Handbook:

Section 10  Rights of Listing Brokers in Presentation of Counter-offers (Policy Statement 7.74)
“Listing participants or their representatives have the right to participate in the presentation of any counter-offer made by a seller or a lessor. They do not have the right to be present at any discussion or evaluation of a counter-offer by the purchaser or lessee (except where the cooperating broker is a sub-agent). However, if a purchaser or lessee gives written instructions to the cooperating broker that the listing broker may not be present when a counter-offer is presented, the listing broker has a right to a copy of those instructions. (Adopted 11/04)”

[SOURCE: TAR Legal & Ethics Hot Line Attorneys]


7. Upcoming Events and Courses

Feb. 15: 2011-2012 Core CE Course (6 hrs. CE) - GNAR, Nashville. For more information or to register, call 615-254-7516.

Feb. 16: West TN Professional Standards Training for Local Association Professional Standards & Grievance Committee members (3 hrs. CE) – Central West TN Assn., Jackson. For more information or to register, CLICK HERE.

Feb. 17: TransactionDesk Training – Basic (3 hrs. CE) – MAAR Office, Memphis. For more information or to register, call 901-818-2421.

Feb. 22: Workshop for Agency Instructors (4 hrs. CE) – TAR Office, Nashville. For more information or to register, CLICK HERE.

Feb. 23: 2011-2012 Core CE Course (6 hrs. CE) – Clarksville Assn. of REALTORS. For more information or to register, call 931-552-3567.

Feb. 24 – March 30: GRI 3, Financing the Successful Transaction (16 hrs. CE) – an E-Class (distance-learning) course. For more information or to register, CLICK HERE.

The complete 2011 schedule of GRI courses (both Classroom and E-Class) is online HERE.

LEADERSHIP TAR: Registrations are now being taken for the 2011 Class of Leadership TAR! For more information or to become a part of it, CLICK HERE.

INSTRUCTOR TRAINING: Registration is now open for our two-day instructor-training program – “The Learning-Centered Instructor Workshop” (16 hrs. CE) – to be held March 10-11, 2011, in Nashville at the TAR Office. For more information or to register, CLICK HERE.

Watch each week’s TAR DIGEST for schedule changes and additions!


8. Rates Pass the 5 Percent Threshold

Freddie Mac reports that the average interest on 30-year, fixed home loans bumped up to 5.05 percent this past week, marking the first time since April 2010 that the rate has passed the 5 percent threshold. While the rising rates suggest that economic recovery is improving, they also threaten to further shake up the still-fragile housing market. Steeper borrowing costs could deter would-be home buyers – especially first-timers – which in turn would exert more downward pressure on residential prices.

[SOURCES: Freddie Mac; Wall Street Journal; Information, Inc.]


9. Useful Internet Links

Click on any of the following to access:

Back Issues of the TAR DIGEST
Tennessee Assn. of REALTORS
TAR Education
TAR on Facebook
Follow TAR on Twitter
Online Risk Reduction Resources
Online Resources for Association Leaders
Tennessee Real Estate Commission


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