CONTENTS
1. More Financial News
2. MAAR Promotes Memphis in Unique Way!
3. Applications Being Taken for Leadership TAR 2009!
4. HOT LINE: Who Chooses Title Company?
5. HOT LINE: Whose Responsibility?
6. Senator Corker Explains His Vote
7. Rates Barely Move
8. UPCOMING EVENTS

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1. More Financial News

A global sell-off and panic on world markets has prompted yet another major drop in stock prices on Wall Street, at the time this DIGEST is being written. Over the weekend, governments across Europe rushed to prop up failing banks, while the governments of Germany, Ireland and Greece also said they would guarantee bank deposits.

It will still be a while before there is ANY clarity about the effects of all this on our housing market in Tennessee …and clarity as to how long and how deep the economic slowdown will be before we see some recovery and relief.

The financial rescue plan that was pushed through Congress last week (see “Senator Corker Explains His Vote” below) will undoubtedly take time to have any real effect, and there has always been a question as to whether that strategy would be enough to avert a deeper crisis. Panic itself may be the biggest obstacle to overcome.

Stay tuned…

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2. MAAR Promotes Memphis in Unique Way!

Our members in Memphis are showing true creativity in marketing their area to others! Last week, a new campaign by the Memphis Area Association of REALTORS made the news:

*** BEGIN QUOTE ***
The Memphis Area Association of Realtors will give away $20,000 to the winners of a new YouTube contest it has launched.

MAAR is asking Memphians to show off what makes Memphis home to them in a contest dubbed “Your Memphis: Take One.”

The contest will run through midnight on Nov. 24.

Participants are asked to submit an original three-minute digital video displaying why Memphis is home to them. Each video will be judged based on relevance, creativity and entertainment value. Winning videos will be announced and posted at www.yourmemphistakeone.com.

“As an organization, we promote home ownership and the value of being able to call a piece of Memphis your own,” said John Snyder, board president of MAAR, in a statement. “We also understand that home means many things to many different people, and we want to feature these distinct viewpoints through this creative avenue.”

Said Jules Wade, executive vice president: “These will serve as invaluable tools for Realtors looking to show why a particular section of Memphis is a wonderful place to live.”
*** END QUOTE ***

Well done!

[SOURCE: Memphis Business Journal]

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3. Applications Being Taken for Leadership TAR 2009!

Applications are now being accepted for the 2009 Class of Leadership TAR! Program criteria, dates of the retreats, program criteria, etc., are all explained on page 1 of the Application Form.

Applications for the LEADERSHIP TAR Program are invited from all TAR members. Participants will work together at three different retreats in 2009 (April 22-24, June 10-11, and August 12-13) to build their leadership skills and self-awareness, build a network with their peers, and learn more about the challenges facing the REALTOR organization and our industry. For more information, download the Application Form.

The APPLICATION DEADLINE for the 2009 Class is DECEMBER 1, 2008! To download an Application Form, in either Word  or PDF format, go to The NEWSROOM section of the TAR Website at: http://www.tarnet.com/main/newsroom/

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4. HOT LINE: Who Chooses Title Company?

QUESTION: I have presented two (2) offers to purchase on a piece of property. One was countered, so I made a new offer. I put in each offer the buyer has chosen XX Title Co., and seller can use this title company or whatever title company they choose. The seller’s agent is insisting that the buyer use the title company of seller’s choosing. What can we do about this, as I am having to back down and my buyers are suffering?

ANSWER: Under RESPA, if the buyer is purchasing the title insurance, then the seller cannot dictate which title company must be used.  However, if the seller is paying for the title insurance, then it is up for negotiation. If the parties cannot agree, then you could have a split closing, each at the title company of their own choosing.

If the seller’s agent is insisting that the seller dictate the title company and the buyer is paying for the policy, then you could report them to the Department of Housing and Urban Development (HUD) for a RESPA complaint.

For more information about RESPA, look HERE.

You can also file a complaint with the local board (if you feel that the agent is violating the NAR Code of Ethics) or with TREC (if you feel that the agent is violating the Broker’s Act or TREC Rules).

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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5. HOT LINE: Whose Responsibility?

QUESTION: Is it my responsibility as agent for the seller to ask a customer whether or not they are working with another agent when they are viewing a home?

ANSWER: When encountering a customer, an agent should ALWAYS ask if they are working with another agent. If there is already an agency agreement in place with another agent, then you could be charged with interference with a contract if you try to “squeeze out” the agent with the contract. However, if there is not an agency agreement in place, then you really have not done anything illegal. We would STILL recommend that if the customer tells you he is working (or has been working) with another agent, that you contact that agent. This protects not only the customer, but also the agent.

In addition, see Standard of Practice 16-9:

“REALTORS, prior to entering into a representation agreement, have an affirmative obligation to make reasonable efforts to determine whether the prospect is subject to a current, valid exclusive agreement to provide the same type of real estate service. (Amended 1/04)”

…and Standard of Practice 16-13:

“All dealings concerning property exclusively listed, or with buyer/tenants who are subject to an exclusive agreement shall be carried on with the client’s representative or broker, and not with the client, except with the consent of the client’s representative or broker or except where such dealings are initiated by the client.

“Before providing substantive services (such as writing a purchase offer or presenting a CMA) to prospects, REALTORS shall ask prospects whether they are a party to any exclusive representation agreement. REALTORS shall not knowingly provide substantive services concerning a prospective transaction to prospects who are parties to exclusive representation agreements, except with the consent of the prospects’ exclusive representatives or at the direction of prospects. (Adopted 1/93, Amended 1/04)”

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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6. Senator Corker Explains His Vote

Last week U. S. Senator Bob Corker invited the TAR Governmental Affairs Committee to join him on a conference call to discuss the Emergency Economic Stabilization Act that passed last week. With his seat on the Senate Banking Committee, Senator Corker was front and center during the debate over the legislation.

Senator Corker said it was a tough decision to vote in favor of the bill but necessary to “avoid an economic calamity that would affect every Tennessean’s and every American’s ability to get a car loan, a home loan, a student loan, use a credit card or even cash a paycheck.”  A strong emphasis was made that his backing of the measure was NOT about Wall Street or fluctuations in the stock market, but instead, Sen. Corker’s support was about unfreezing credit markets and getting the nation’s economy back on track.

To learn more about the economic relief legislation passed by Congress and how it will impact the housing market go to NAR’s website.

TAR greatly appreciated Senator Corker asking for an audience with Tennessee REALTORS. TAR Governmental Affairs Chair Christie Wilson, TAR President Mike Gaughan and Senator Corker’s Federal Political Coordinator George Kangles all served as co-hosts for the call.

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7. Rates Barely Move

Freddie Mac reports a small rise in the 30-year fixed mortgage rate to 6.10 percent during the week ended Oct. 2 from 6.09 percent the prior week. The 15-year fixed mortgage rate nudged up to 5.78 percent from 5.77 percent. However, the five-year adjustable mortgage rate slipped to 6.00 percent from 6.02 percent; and the one-year ARM dropped to 5.12 percent from 5.16 percent. The report shows that the 30- and 15-year mortgage rates are down substantially from the same time in 2007, when they averaged 6.37 percent and 6.03 percent, respectively.

[SOURCE: Freddie Mac]

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8. UPCOMING EVENTS

Oct. 9: Surround Sound Training by NAR (TAR Office, Nashville)

Oct. 9-10: GRI 5 - Systems for Success (Memphis)

Oct. 16: Commercial Forms Committee Meeting (TAR Office, Nashville)

Oct. 28-29: GRI 2 - Smart Marketing (Knoxville)

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TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

CONTENTS
1. Update on the Crisis
2. It’s Affordable in Tennessee!
3. HOT LINE: Improper Use of Photos?
4. HOT LINE: Conditions on Compensation?
5. HOT LINE: Deposit In Lieu of Earnest Money?
6. WORKING SMARTER: YouMail
7. Rates Jump Amid Financial Turmoil
8. UPCOMING EVENTS

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1. Update on the Crisis

As this issue of the weekly TAR DIGEST goes to press, there is STILL no Congressional agreement on a “bailout” package to calm troubled waters in the economy!

It’s aggravated, as we noted last week, by the fact that we’re in the midst of an election season  …so it’s nearly impossible to find a reliable and OBJECTIVE source of reporting and analysis of what’s going on. Almost every news outlet has a bias and therefore a vested interest in fixing blame for this mess on one Party or another.

Hopefully, by this time next week, we’ll have a better idea of the damage, and the bill for that damage that taxpayers must pay!

[SOURCES: various]

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2. It’s Affordable in Tennessee!

Among all of the negative news stories that crossed our desks last week, one news item actually was a “win” for one Tennessee city:

*** BEGIN QUOTE ***
The cost of buying and maintaining a home is pretty reasonable if you live in certain Midwestern or Southern cities, according to Forbes magazine’s new report.

To determine America’s least expensive places to own a home, Forbes used data from the U.S. Census Bureau’s 2008 American Community Survey, released Tuesday.

The survey reported the 2007 median monthly housing costs in the country’s metro areas with a population over 65,000. Housing costs include monthly mortgage payments, real estate taxes, various insurances, utilities, fuels, mobile home costs and condominium fees.

Here are the top-10 cheapest cities to own a home:

1. Cleveland: $978 a month
2. Columbus, Ohio: $1,060 a month
3. Pittsburgh: $1,187 a month
4. San Antonio, Texas: $1,216 a month
5. Indianapolis: $1,232 a month
6. NASHVILLE: $1,256 A MONTH
7. New Orleans: $1,296 a month
8. St. Louis: $1,299 a month
9. Charlotte, N.C.: $1,336 a month
10. Cincinnati: $1,353 a month

*** END QUOTE ***

To access the original FORBES Magazine article that was the source for this report, go HERE.

[SOURCES: REALTOR Magazine Online; FORBES]

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3. HOT LINE: Improper Use of Photos?

QUESTION: I had a property listing that expired. A team with another company listed the property two days later and used my photos. This was reported to the MLS, and the photos were removed by the MLS. However, I showed the property a few weeks later and found that the agents have used my photos in their brochures.  Can they do this?

ANSWER: NO, this is illegal. Another agent should NOT use your pictures without your permission. In the United States, it is not necessary to officially register a copyright. Nor is it required to have any copyright symbols on the site.  It is enough to publish it on the website.

There are several articles on copyright issues that you may access on the NAR website located at WWW.REALTOR.ORG. In the search field on REALTOR.ORG, enter “copyright”. Articles there should help you. If the other agent will not agree to remove your photos from her advertising materials, then you may have to speak to a copyright attorney.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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4. HOT LINE: Conditions on Compensation?

QUESTION: Can an agent place the following in the general remarks or agent notes for a listing in the MLS?

     “Please be aware that if you tour a listing with more than one agent you will create additional financial liability for you and the agent who prepares your offer.”

     “If you write an offer on this listing and your buyer toured the home with another agent there will be a 25% discount from your commission to compensate the other showing agent for that buyer.”

ANSWER: NO, this is not allowed. This appears to be an attempt to circumvent procuring cause. A MLS listing intended to be an unconditional offer of compensation. The agent is placing conditions on this offer; therefore, it is not allowed.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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5. HOT LINE: Deposit In Lieu of Earnest Money?

QUESTION: I am working on a transaction wherein the offer includes contingencies. The only way the seller will accept the offer is if the buyer deposits with the seller a non-refundable down payment that he can cash immediately. Is this legal?

ANSWER: We do not know of any reason why that would not be allowed under the law AS LONG AS all parties agree to it. HOWEVER, if it is earnest money, call it earnest money. If not, simply indicate that it is non-refundable and will be delivered directly to the seller. You may also want to include language which states that it will be applied to the purchase price of the house.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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6. WORKING SMARTER: YouMail

Among other features, YouMail (www.youmail.com) allows you to create a different, personalized voicemail greeting for each caller, based on his/her number!

It also lets you get your cell phone voice mail on a regular phone, by email, or online  …in whatever way(s) you wish. And there’s more….

This service is risk-free; there is NO charge for it! So explore the site and see if this tool can help you out!

[Hat tip to Nashville REALTOR Brian Copeland for this week’s productivity tip! It was also cited during Chandra Hall’s session on systems at the recent TAR Annual Convention in Chattanooga!]

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7. Rates Jump Amid Financial Turmoil

Freddie Mac’s Primary Mortgage Market Survey showed the 30-year fixed-rate mortgage (FRM) averaging 6.09 percent with an average 0.7 point for the week ending September 25, 2008, up from the prior week when it averaged 5.78 percent. Last year at this time, the 30-year FRM averaged 6.42 percent.

The 15-year FRM on Friday averaged 5.77 percent with an average 0.6 point, up from the previous week when it averaged 5.35 percent. A year ago at this time, the 15-year FRM averaged 6.09 percent.

“Mortgage rates followed Treasury bond yields higher this week amid market uncertainty over the current state of the economy,” said Frank Nothaft, Freddie Mac vice president and chief economist. “The latest housing information for the third quarter continues to show some softness in prices and sales activity.”

[SOURCE: Freddie Mac]

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8. UPCOMING EVENTS

Oct. 2: Residential Forms Committee Meeting (TAR Office, Nashville)

Oct. 9: Surround Sound Training by NAR (TAR Office, Nashville) …this event “by invitation only”

Oct. 9-10: GRI 5 - Systems for Success (Memphis)

Oct. 16: Commercial Forms Committee Meeting (TAR Office, Nashville)

_______________________________________________________
TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

CONTENTS
1. Returning to Fundamental Economic Values
2. 2009 TAR Officers Elected, Installed
3. 2008 State Awards Announced!
4. NEW Insurance Option Announced!
5. HOT LINE: Co-listing Dilemma
6. HOT LINE: Surprised by a “Bonus”
7. 30-Year Rates at Seven-Month Low
8. UPCOMING EVENTS

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1. Returning to Fundamental Economic Values

Stories about the nation’s financial crisis have dominated the national news lately. Unfortunately, since we are in the midst of an election season when everyone becomes a little crazier than normal, charges of blame have been flying back and forth …overshadowing any calmer assessments of how - long-term - we work our way out of this mess!

That’s why we welcomed a commentary posted last week (“Sacrifice over excess”) by Bradley Inman, head honcho for Inman News. Regardless of whether you agree or disagree with all that Brad Inman lays out as cause, effect, and remedy, his call for a return to fundamental values is refreshing:

*** BEGIN QUOTE ***
Today, we face a long recovery to an economic calamity that has been long in the making and will not be resolved with quick fixes. It will take time as well as a return to fundamental economic values. This is not about family values, but conservative — not political — personal financial values and wise public policies that favor savings over irrational debt, that give up short-term consumption for sacrifice, and that reward investment not speculation.
*** END QUOTE ***

To read the whole commentary (you can even add your own comments in response at the same site), go HERE.

[SOURCE: Inman News]

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2. 2009 TAR Officers Elected, Installed

This past week, at the TAR Annual Convention iin Chattanooga, the following individuals were elected and stalled as TAR’s top officers for 2009:

2009 President - Fontaine Taylor (Memphis)

2009 President-elect - B. J. Swinehart (Knoxville)

2009 Secretary/Treasurer - Emil Mongeon (Franklin)

2009-2010 Division 1 VP - John Snyder (Memphis)

2009-2010 Division 2 VP - Marlene Rakow (Columbia)

2009-2010 Division 3 VP - Doris Barnes (Pigeon Forge)

Congratulations to all of the new TAR officers!

Three divisional vice presidents will continue on the TAR Executive Committee in the second year of their terms: Sue Turner (Memphis), Janice Carlton (Shelbyville), and Randy Thomas (Kingsport).

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3. 2008 State Awards Announced!

Another major event at the TAR Annual Convention was the announcement of the recipients of TAR’s four highest awards:

2008 REALTOR of the Year: Christie Wilson (Nashville)

2008 Presidential Award: Christie Wilson (Nashville)

2008 State REALTOR Educator of the Year: Ron Poe (Memphis attorney)

2008 Outstanding GRI Student of the Year: Martha Miller (Chattanooga)

If you know ANY of these individuals, please join us in congratulating them on their outstanding service and achievements!!

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4. NEW Insurance Option Announced!

Need Assistance with Heath Insurance? Last week, 2008 TAR President Mike Gaughan announced a new strategic alliance with a health insurance broker, Sound Healthcare:

TAR offers this information to assist you in your search for affordable health insurance. Sound Healthcare is not an insurance company, but is instead an insurance broker who works with many insurance companies to identify an option to fit your individual needs. This is NOT a group plan; it’s a service for individuals. Sound Healthcare feels that, with group buying power, they can find quality health insurance for TAR members at an affordable price. There is, however, NO guarantee that you’ll be able to find coverage. This is simply a source of information and a place to start when shopping for insurance.

While TAR and NAR continue to work toward the day when we can make true group coverage for health insurance available through your REALTOR organization, we hope that brokers like Sound Healthcare can expand the number of options presently available to you.

FOR MORE INFORMATION, please contact:
Sound Healthcare
R. J. Stillwell, Executive Director
PHONE: 615-256-8667
EMAIL: musicrow@aol.com

[Please direct all questions about this coverage to R. J. Stillwell.]

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5. HOT LINE: Co-listing Dilemma

QUESTION: We have an agent in the office who is the co-listing agent for a property. The other agent is with a different company. On the MLS they are showing it as co-listed. We have not seen any of the paperwork. We have copies of their contracts, but nothing with the buyer’s signature on paperwork for our office or company. As a managing broker, I need to know what to do.

ANSWER: It does not matter whose forms are used. However, BOTH companies and agents have to be on the listing agreements and all the other documents, and both companies should have copies of everything. Please understand that the two companies are EQUALLY responsible for everything on the transaction. Everyone in the transaction is responsible from a liability standpoint AND from an audit standpoint.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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6. HOT LINE: Surprised by a “Bonus”

QUESTION: I represent the sellers with the sale of their home. An agent from another company representing the buyer brought me an offer on my listing. The offer included a $2,000 bonus for the selling agent, BUT I never advertised a bonus on the MLS or anywhere, because one was not offered by the seller! While reviewing the offer prior to presenting it to my sellers, I asked the buyer’s agent why he was to receive a bonus? (I thought perhaps the seller had mentioned it to him in passing.) He told me that he just had to work extra hard with the buyers, showing them a lot of properties, and he thought he deserved it. I presented the offer to my sellers which I think they may accept, because they really need to move the property. Did this other agent act properly?

ANSWER: NO. This was VERY inappropriate on the other agent’s part. The purchase and sales agreement is NOT the place for the agent to negotiate the payment of a commission or a bonus. The agent is not a party to the contract. Furthermore, he is not permitted to “hold an agreement hostage” for his own benefit. Finally, he is also putting his own interests above that of his buyer which is in violation of the Broker’s Act and the Code of Ethics.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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7. 30-Year Rates at Seven-Month Low!

Freddie Mac reports a decline in the 30-year fixed mortgage rate to 5.78 percent during the week ended Sept. 18 from 5.93 percent the prior week, marking the lowest level in seven months. During the same period, the 15-year mortgage rate dropped to 5.35 percent from 5.54 percent. Meanwhile, interest on five-year adjustable mortgages slipped to 5.67 percent from 5.87 percent; and the one-year ARM slid to 5.03 percent from 5.21 percent.

[SOURCES: Information, Inc.; Freddie Mac]

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8. UPCOMING EVENTS

Sept. 24-25: GRI 1 - Professionalism in Real Estate (Knoxville)

Oct. 2: Residential Forms Committee Meeting (TAR Office, Nashville)

Oct. 9: Surround Sound Training by NAR (TAR Office, Nashville) …this event “by invitation only”

Oct. 9-10: GRI 5 - Systems for Success (Memphis)

Oct. 16: Commercial Forms Committee Meeting (TAR Office, Nashville)

_______________________________________________________
TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

CONTENTS
1. Home Sales Essentially Flat
2. Who SHOULD You Be Working With?
3. HOT LINE: Two Buyers, One Property
4. HOT LINE: Sharing an Inspection Report
5. WORKING SMARTER: Becoming More Persuasive!
6. Rates Fall Below 6
7. UPCOMING EVENTS

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1. Home Sales Essentially Flat

The level of home sales is expected to show little movement in the months ahead, according to the latest projections. The Pending Home Sales Index, a forward-looking indicator based on contracts signed in July, fell 3.2 percent to 86.5 from an upwardly revised reading of 89.4 in June, which had risen 5.8 percent from May. The July index remains 6.8 percent below July 2007 when it stood at 92.8.

Lawrence Yun, NAR chief economist, said home sales continue to edge up and down. “Pending home sales are oscillating month-to-month, with the long-term trend essentially flat,” he said. “Overly stringent lending criteria imposed by Fannie Mae and Freddie Mac in the past month no doubt held back contract signings.”

To read more, go HERE.

[SOURCE: NAR]

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2. Who SHOULD You Be Working With?

Many REALTORS are wisely using a slowdown in market activity to rethink their businesses and business models, as well as their approaches to prospecting.

A recent article by Craig Proctor, published by RISMedia, includes a pretty comprehensive set of questions that agents should be asking themselves, as well as reminders about the folly of trying to be all things to all people:

*** BEGIN QUOTE ***
…when you try to be everything to everyone, you fail to address the specific needs of anyone. If you’re “targeting” everyone, your message is bound to be broad and unfocused, and is unlikely to be compelling and direct enough to draw in your prospect (whoever that is).

An unclear definition of who you’re talking to with your marketing will lead to watered down statements that don’t mean very much to anyone…
*** END QUOTE ***

He goes on to describe the process of targeting your future clients more effectively, and developing a strategy to reach them.

To read “Who in the World Should You Be Working With?”, go HERE.

[SOURCE: RISMedia]

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3. HOT LINE: Two Buyers, One Property

QUESTION: I have 2 separate people wanting to put an offer on a property that I was showing one day. I’ve shown the property to both prospective buyers. Can an agent write two (2) separate offers on a property if it is not their listing? If buyer A — with whom I have signed a buyer representation agreement — makes an offer through me, what type of relationship, if any, do I need to have in order to write the second offer?

ANSWER: You indicated that you have a buyer’s representation agreement with one of the buyers. We would encourage you to allow another agent in your office to work with the second buyer. [Make sure that you are the Designated Agent for buyer A.] This is because you have a fiduciary duty to buyer A. You can ask for a referral fee for referring the second buyer, but that fee must be disclosed to both parties.

If there were no buyer’s representation agreements in place, you could technically work with both buyers as a facilitator if your company policy permitted this. HOWEVER, your role with both buyers would have to be disclosed to all buyers. In addition, you should NOT offer advice on pricing, contingencies, etc. Even in this situation, we would recommend sending one of the buyers to another agent. That way, it is much less likely that you will be accused of any wrongdoing!

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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4. HOT LINE: Sharing an Inspection Report

QUESTION: If a buyer gives the seller a copy of a home inspection report and the transaction falls through for any reason, is the seller allowed to show the home inspection report to other potential buyers? I assume that the seller would not be free to dispense copies, but I am not clear about allowing someone to just visually review the report.

ANSWER: You are not permitted to share the inspection report that was purchased by someone other than your client unless you have the permission of the person who paid for the inspection.

HOWEVER, please remember that if you have notice or knowledge of information on that report which constitutes an adverse fact, you are required under the Broker’s Act to disclose that information.  Pursuant to Tenn. Code Ann. 62-13-403(2), a real estate agent is required to “[d]isclose to each party to the transaction any adverse facts of which the licensee has actual notice or knowledge.” Tennessee law defines an adverse fact as “conditions or occurrences generally recognized by competent licensees that have a negative impact on the value of the real estate, significantly reduce the structural integrity of improvements to real property or present a significant health risk to occupants of the property.” Tenn. Code Ann. 62-13-102(2).

THEREFORE, if you have actual knowledge of an adverse fact, you must disclose it. I would recommend that you make these disclosures in writing and have the potential buyers sign off on it indicating that they have received a copy.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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5. WORKING SMARTER: Becoming More Persuasive!

Garr Reynolds, one of the foremost authorities on good presentations (especially, the use of PowerPoint in presentations!) reviewed a book last week that looks promising: Yes!: 50 Scientifically Proven Ways to Be Persuasive, by Dr. Robert B. Cialdini and others.

*** BEGIN QUOTE ***
The book is designed for anyone in business who is interested in becoming better at understanding how to persuade or influence (isn’t that just about everyone?). The book may also help you understand why you decide to do the things you do.
*** END QUOTE ***

To read his whole review, go HERE.

By the way, if you use PowerPoint for sales presentations or teaching, get Garr Reynolds’ own book, Presentation Zen. It’s the best book out there on the use of PowerPoint!

[SOURCE: Presentation Zen]

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6. Rates Fall Below 6

For the first time since early spring, mortgage rates have fallen below the 6-percent threshold. Freddie Mac reports that 30-year fixed loans came in at an average of 5.93 percent last week, down from 6.35 percent a week earlier and 6.31 percent at the same time last year.

A borrower taking out a $200,000 mortgage at 5.93 percent would pay $1,190 for monthly principal and interest payments, which is $54 less than the payments on the preious week’s rate. “Consumers see a five in front of mortgages, and they get excited,” says Keith Gumbinger, a vice president at research firm HSH Associates.

[SOURCES: Information, Inc.; Freddie Mac]

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7. UPCOMING EVENTS

Sept. 17-19: TAR Annual Convention! (Chattanooga, TN)

Sept. 24-25: GRI 1 - Professionalism in Real Estate (Knoxville)

Sept. 30: Commercial Forms Committee Meeting (TAR Office, Nashville)

Oct. 2: Residential Forms Committee Meeting (TAR Office, Nashville)

Oct. 9-10: GRI 5 - Systems for Success (Memphis)

_______________________________________________________
TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

CONTENTS
1. U.S. Seizes Control of Freddie & Fannie
2. NAR Audio Update on RESPA Enforcement
3. HOT LINE: Only One on the Deed?
4. HOT LINE: Misrepresentation of Agency Status
5. WORKING SMARTER: Cool Tools
6. Mortgage Rates Move Lower
7. UPCOMING EVENTS

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1. U.S. Seizes Control of Freddie & Fannie

The federal bailout of Fannie Mae and Freddie Mac involves putting the companies under conservatorship and placing the Federal Housing Finance Agency in charge of their operations and appointment of senior managers. The government has dismissed Fannie Mae and Freddie Mac’s CEOs — who will, however, assist in the transition — and will provide capital, if necessary.

The plan also calls for a cut in the stake of current shareholders to 20 percent from 100 percent. It additionally will require an increase in mortgage funding by Fannie Mae and Freddie Mac through the end of next year to stabilize the housing market; however, mortgage volume will be reduced 10 percent annually for a decade beginning in 2010 to reduce risks to the overall financial system. The companies — which will no longer be allowed to lobby or engage in other political activities — will be restructured by Congress before 2010.

For the short term, this move will hopefully bring some stability to the housing outlook. Long-term implications of this move and the ultimate impact on the market will not, however, be fully known for some time.

[SOURCES: Information, Inc.; Washington Post]

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2. NAR Audio Update on RESPA Enforcement

In their September podcast, NAR’s Legal Affairs Department has posted a new briefing online about HUD’s recent enforcement of RESPA — the Real Estate Settlement and Procedures Act. The program, featuring New Orleans attorney Mark Stebcow, focuses on marketing arrangements and agreements that violate both the spirit and letter of the law, often involving improper kickbacks and/or referral fees.

The length of this audio program is just over 8 minutes. As with all podcasts, you can listen to it through your computer speakers (if you have some) or download it to a CD or an iPod, for later listening.

Worth listening to…

To do so, go HERE.

[SOURCE: NAR]

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3. HOT LINE: Only One on the Deed?

QUESTION: My homeowner recently was married and she is the only person on the deed. Does the husband need to sign the listing agreement?

ANSWER: We WOULD recommend going ahead and getting the husband’s signature to be safe. Under family law, if the husband has contributed to the payment or upkeep of the house, he has an interest in the house.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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4. HOT LINE: Misrepresentation of Agency Status

QUESTION: I had a call from a customer off a yard sign. We always ask if the buyer is represented, or expects to be, and if they say yes, we ask to have the agent call. While I was showing the house, another licensee walked up and said that he represented the buyer. I called my office to confirm what this customer had originally told us with regard to agency; I was correct in thinking the customer was not represented, and did not expect to be. I then asked this other licensee if he had a buyer’s representation agreement with this buyer, and he said he did not. Is it legal for an agent to tell third parties that he represents a client without a buyer representation agreement?

ANSWER: NO. He cannot say that he represents a buyer without a buyer’s representation agreement. This would constitute misrepresentation since he is stating that there is an agency relationship between them when there is not. He could be working with someone as a facilitator without having a buyer’s representation agreement, but could not claim to be their agent EVEN IF he intended to negotiate and sign a buyer representation agreement at a later date.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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5. WORKING SMARTER: Cool Tools

With this issue of the TAR DIGEST, we include a feature that you’ll see with some regularity — WORKING SMARTER — with a focus on tools and tips that can save you time, bring some sanity to your work life, and/or help you work more effectively:

Last week, Bernice Ross wrote an article for Inman News (“Cool real estate Web tools”) that describes several new Web-based services and innovations!

Finding cheaper gas, tracking pricing numbers, discovering some unique characteristics of the communities you’re marketing …these are just a few of the “cool tools” she describes.

The article includes enough links to keep you busy for a while, so set aside a few minutes to explore it HERE.

[SOURCE: Inman News]

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6. Mortgage Rates Move Lower

The 30-year fixed mortgage rate declined for the third consecutive week to 6.35 percent during the week ended Sept. 4 from 6.40 percent the prior week, according to Freddie Mac. The 15-year fixed mortgage rate slipped to 5.90 percent from 5.93 percent over the same period. Meanwhile, the five-year adjustable mortgage rate dropped to 5.97 percent from 6.03 percent; and the one-year ARM fell to 5.15 percent from 5.33 percent.

[SOURCES: Information, Inc.; Freddie Mac]

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7. UPCOMING EVENTS

Sept. 17-19: TAR Annual Convention (Chattanooga, TN)

Sept. 24-25: GRI 1 - Professionalism in Real Estate (Knoxville)

Sept. 30: Commercial Forms Committee Meeting (TAR Office, Nashville)

Oct. 2: Residential Forms Committee Meeting (TAR Office, Nashville)

Oct. 9-10: GRI 5 - Systems for Success (Memphis)

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TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

CONTENTS
1. Biggest Marketing Bang for the Buck?
2. Five Steps to “Inbox Zero”!
3. HOT LINE: The Binding Date & Notice of Receipt
4. HOT LINE: A Seller With Alzheimer’s
5. Hotel DEADLINE August 26Th!
6. Rates Drop Slightly
7. No DIGEST Next Week

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1. Biggest Marketing Bang for the Buck?

One of the more interesting areas of REALTOR.ORG is the weblog run by and for REALTOR Magazine’s “Young Professionals Network“. A recent article, by REALTOR Dina Takai, outlines her own recommendations for the best marketing tools (for the money) that she currently uses:

• BNI.COM - Referral Network group
• Digital Post-it Notes
• Starbucks Wifi
• Social Networking Sites

To read why she recommends these four, as well as comments from others about her advice, go HERE.

You can even add your own comment or suggested marketing tool while you’re there!

[SOURCE: REALTOR.ORG]

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2. Five Steps to “Inbox Zero”!

“You don’t have to live in fear of your e-mail inbox or be a slave to it….”

That statement marks the beginning of an article that ran this summer on Inman News. Merlin Mann - a widely-recognized authority on more effective time management, life balance, and information overload - spoke at Inman News’ Real Estate Connect Conference this year about email management, among other topics.

An Inman News article (”5 steps to ‘Inbox Zero’”) recapped some highlights of his presentation and can be read HERE.

Merlin Mann’s website — http://www.43folders.com — is also WELL worth a visit …it’s one of this editor’s bookmarks, visited often!

[SOURCE: Inman News]

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3. HOT LINE: The Binding Date & Notice of Receipt

QUESTION: My understanding regarding notice of acceptance is that delivery to the other party would be annotated by the binding agreement date. In Tennessee, acceptance by the parties’ agent is deemed acceptance by the party, and in that case the agent could fill in the binding agreement date. That is also provided for in paragraph 15 of the purchase and sale agreement.

Is it the same if the licensee is only a facilitator? I believe that if a party has a facilitator, then acceptance could not occur until the party themselves receive it, because a representation agreement does not exist. However, paragraph 15 of the purchase and sale agreement states that both parties agree that either licensee can fill in the date. So, if notice is received by a facilitator, is that deemed notice to the party?

ANSWER: YES. Notice received by the facilitator is deemed to be notice to the party.  Please see Paragraph 15G.  It states “NOTICE shall be deemed to have been given as of the date and time it is actually received. Receipt of notice by the real estate licensee or their Broker assisting a party as a client or customer shall be deemed to be notice to that party for all purposes under this Agreement as may be amended, unless otherwise provided in writing.”  Since it states that notice is deemed to be received by a licensee assisting a party as a client (agent) or customer (facilitator), notice of acceptance to the licensee is sufficient even if that licensee is a facilitator.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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4. HOT LINE: A Seller With Alzheimer’s

QUESTION: We have a situation where the legal owner has Alzheimer’s Disease. The property is to be listed under the authority of an individual holding a valid power of attorney, but the individual with power of attorney does not and has not ever resided on the subject property themselves. Which Property Condition form should be used - the Disclosure or the Exemption?

ANSWER: The best thing to do in this situation is to use the Disclaimer form. The individual with power of attorney does not qualify for the Exemption and does not have the knowledge to complete the Disclosure form. It should be explained to any prospective buyers that the owner has Alzheimer’s (after getting the power of attorney’s permission to do so), and that the power of attorney does not have the information available to accurately complete the Disclosure form.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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5. Hotel DEADLINE August 26Th!

Our hotel block for the TAR Annual Convention in September is ALMOST completely booked!

Our hotel room block expires AUGUST 26TH. To contact the Chattanooga Marriott for reservations, please call 800-841-1674 as soon as possible!

ALSO, be aware that advance registration for the TAR Convention ends this FRIDAY, AUGUST 29th!  After that date, anyone wishing to register must do so ON-SITE, at a significantly higher price! To register in advance — THIS WEEK ONLY — go HERE.

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6. Rates Drop Slightly

Freddie Mac reports a drop in the 30-year fixed mortgage rate to 6.47 percent during the week ended Aug. 21, down from 6.52 percent during the prior three weeks. Meanwhile, the 15-year fixed mortgage rate slipped to 6 percent from 6.07 percent a week ago. Over the same period, the five-year adjustable mortgage rate fell to 5.99 percent from 6.02 percent, and the one-year ARM rose to 5.29 percent from 5.18 percent.

[SOURCES: Freddie Mac; Information, Inc.]

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7. No DIGEST Next Week

There will be no TAR DIGEST next week, but we want to wish EVERY reader a very happy Labor Day! We know that many of our members will be working next weekend, but please take some time off from your labors to enjoy family and friends and be thankful for the opportunity to live and work in a great nation!

The next TAR DIGEST you receive will be the 9-9-08 Edition.

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TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

_______________________________________________________

CONTENTS
1. What Forms are mandatory in Tennessee?
2. Whatever happened to “Seller warrants…” in the Purchase and Sale Agreement?
3. How does the Closing company know the amount to pay licensees when the Compensation is not addressed in the Purchase and Sale Agreement?
4. NEW UPDATE - Placing company LOGOS on TAR forms when using TransactionDesk
5. The Residential Forms Committee Needs Your Help
6. Got Broadband?

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1. What Forms are mandatory in Tennessee?

The short and simple answer is that there are NO STATE MANDATED forms with the  exception of the “Residential Property Condition Dislcosure” form and  the “Commercial/Industrial Real Property Disclsoure” form (respectively TAR forms F16 and F51). And even so, the Commercial/Industrial Real Property Disclosure is subject to some very strict limitations:

At the request of a prospective tenant, the owner of commercial or industrial real property where the commercial property space is one thousand five hundred square feet (1,500 sq. ft.) or less, and the industrial real property is five thousand square feet (5,000 sq. ft.) or less, shall furnish to such prospective tenant a signed disclosure statement detailing the extent to which such real property is understood by the owner to be in compliance with local and state fire, plumbing, and electrical codes for a building of the type under construction.

In addition, there are FEDERAL FORMS that are required such as the “Lead Based Paint Disclosures” pamphlets, etc.

HOWEVER–
While there may not be state mandated forms, THERE IS REQUIRED LANGUAGE and REQUIRED DISCLOSURES that are mandated by the state of Tennessee.

TAR forms are provided for the convenience of its members to make sure members are in compliance with the required language and disclosures.  It is NOT required that the membership use the TAR forms, but they are available for use and your convenience.  An advantage to using the TAR forms is that these forms are reviewed every year by an attorney to ensure that they are in compliance with any changes that have been made in state law or in TREC Rules. In addition, COMPANIES are eligible for a 5% Company E&O Insurance discount by adopting and using the TAR standard forms through Rice Insurance - the state’s preferred provider.

As you know, there have been many changes over the last several years in both state law and in TREC Rules and the TAR Forms incorporate all of these changes.  You can download the detailed WHITE PAPER (below) as an aid in making suggestions as to the forms available which incorporate any and all required disclosures and/or required language in a typical real estate transaction. This “white paper”  supplied by TAR’s counsel will help you determine the suggested TAR Forms that you should be using to be in compliance with required language and required disclosures. If you elect to use your own forms, this paper is also useful in providing a compliance outline.

Download the WHITE PAPER.

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2. What ever happened to the “Seller warrants…” OR “Condition of Premises” language in the Purchase and Sale Agreement?

For a few years now the Purchase and Sales Agreement (PSA) no longer contains language  the “Seller warrants..” as to the condition of property, some companies are adding an addendum or verbiage in the special stipulations area that puts this “old” language back in the form.

Here’s some history for your understanding as to why this language no longer exists and a word of caution.

The word warrant is definitely a problem since Sellers aren’t professionals or experts in HVAC, Plumbing, Electrical services, etc.

Also, the TAR Residential Forms committee provides for a FINAL INSPECTION in which the Buyer has the opportunity to reinspect everything prior to closing.

See Lines 183 - 184 of the PSA:
Seller shall cause all utility services and any pool, spa, and similar items to be operational so that Buyer may complete all inspections and tests under this Agreement. 

The TN Property Condition Disclosure, if used properly, would be more than sufficient to calm the anxiety over what is included and whether or not the Seller will own up to the condition of the property.

One cannot legislate morality and whether a Seller signs either document dishonestly is not under one’s control. By educating agents to have sellers fill out the disclosure at the time of listing and having selling agents insist on a copy so that the buyers will have this information when the offer is written is highly recommended when training agents.

In addition, a couple points of caution -  

#1
Adding an addendum or special stipulation verbiage with the “old language” may eliminate much of the protection built into the inspection section of the PSA.
#2
Adding the old language via addendum or special stipulation makes a neutral PSA lop-sided in favor of the Buyer.  Do you really want your Seller to warrant if it is your listing?

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3. How does the Closing company know the amount to pay licensees when the Compensation is not addressed in the Purchase and Sale Agreement?

Take a look at TAR form F56 - Compensation Agreement Between Listing & Seller Broker. This form is also referred to as the “Cooperative Agreement”.

It is used so your firm will have an agreement in writing concerning the cooperating commission to be paid by the listing firm. Most MLS Rules and regulations require cooperating compensation for entry into the MLS, however this form will be the actual agreement between the selling firm and the listing firm.

This form has language that will protect all involved parties. It is recommended this form be completed when you are showing property. If you have this agreement in place before you show property, then there are no questions concerning the division of cooperating commissions or cutting commissions to make transactions work.

This form would also provide the listing licensee and the selling licensee documentation in case a Carry Over Period is utilized in a listing agreement.

SUGGESTED TIP:
Why not fill this out when you list a property and upload to your MLS system (if available) with your disclosure documents. hTe Buyer’s Representative can print it off and submit it as an executed agreement with their offer!  Save some time!

HOW DOES EACH PARTY GET PAID - GENERAL PRACTICE AT CLOSING:

When it comes to the actual closing and and the checks that are being cut to the Listing Broker and Selling Broker, the closing company needs to see this form (F56) to determine the compensation that is to be paid to the Selling Broker.

In addition, the closing company would also need to see the ACTUAL “Listing Agreement” to determine the compensation that is to be paid to the Listing Broker. (Seller to Listing Broker).

The listing agreement should not be shared with the buyer’s agent without the written consent of the seller.

..:: SOURCE of INFORMATION - TAR inFORM Tool ::..

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4. NEW UPDATE - Placing company LOGOS on TAR forms when using TransactionDesk

The field size for the LOGO placement on TAR forms just got BIGGER!!!

Instead of a small square logo, you can now place banner size logos on all of the TAR forms. If you would like to replace your small logo or add a new logo to the TAR forms when using TransactionDesk, you will need to follow the standard requirements:

800 X 125 pixels (dimension size)
JPG, GIF, and PNG graphic formats ONLY

When Advertising for FRANCHISE or COOPERATIVE ADVERTISING GROUPS only, refer to TCA 1260-2-.12 Section (4)(c):
Any licensee using a trade name on business cards, contracts, or other documents relating to real estate transactions shall clearly and unmistakably indicate thereon:
1. his name and firm telephone number (as registered with the Commission) and:
2. the fact that his office is independently owned and operated.

How to update or place new logos on your forms:
1) Send an email to logos@instanetsolutions.com
2) Make sure you attach the logo and in the body of the email identify yourself by First and Last Name and your NRDS ID# and the name of your firm.

Note: All advertising, regardless of its nature and the medium in which it appears, which promotes the sale or lease of real property, shall conform to the requirements of TREC rules. Please review those rules before applying your company logo to the forms.   

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5. The Residential Forms Committee Needs Your Help

In an effort to make the TAR forms inventory better for member use, the TAR Residential Forms Committee humbly asks for your help in filling out a survey. This survey is designed to help the committee collect information for purposes of guiding its decision making processes.

Click on the link below:
Forms Survey

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6. Got Broadband?

Did you know that over 67% of the TAR membership does not have access to DSL? Current times almost necessitates the use of broadband connection for business purposes.

Good News! One of TAR’s discount service providers, HughesNet, can supply broadband  internet access where Cable and DSL  are not offered. HughesNet brings you high-speed access via satellite. Granted, it’s a more expensive but if you need high-speed access, you now have an option that is available.

Hughes Announces Fastest Consumer Satellite Internet Access Plan Ever Offered

Germanton, MD., August 6, 2008 — Hughes Network Systems, LLC, (HUGHES), the world’s leading provider of broadband satellite networks and services, today announced the launch of the fastest consumer broadband satellite Internet access plan ever offered. The ElitePremium plan, operating over the HughesNet® service and utilizing affordable consumer equipment, features download speeds of up to 5 Mbp.

For more information, visit TAR’s web site [ CLICK HERE ]

CONTENTS
1. Advice for Frustrated Clients
2. Tennessee Good Neighbor Recognized!
3. HOT LINE: Submitting Verbal Offers
4. HOT LINE: HOA Restriction Disclosure
5. HOT LINE Advisory: “Fixing” Commission Splits
6. TREEF Trustee Nominees Announced
7. Rates Hold Steady

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1. Advice for Frustrated Clients

A new article by Kathleen Lynn, published on RISMedia, does a nice job of recapping the reasons you might give a seller-client as to why their home is STILL on the market after a longer-than-average listing period. There ARE some buyers in the market, but there are a lot of properties to pick from! Titled “8 Reasons Your Home Hasn’t Sold Yet - Advice for Frustrated Clients”, Ms. Lynn’s article may give you some good talking points for that next difficult conversation with your seller:

*** BEGIN QUOTE ***
David Raimondi put his 100-year-old Allendale, N.J., house and barn on the market, asking $525,000. It’s been almost three years, and the property has still not sold.

Raimondi, a housepainter who wants to move to a less expensive area, is one of the growing ranks of frustrated sellers whose homes have been on the market for more than a year. Though most sellers don’t stay on the market for years, Realtors say the average time between listing and sale has stretched out during the housing slump.

These sellers’ experiences show just how tough the market is. Still, real estate agents say, there are buyers out there, and it’s possible to sell a property if you take the right steps.
*** END QUOTE ***

To read the complete article, click HERE.

[SOURCE: RISMedia]

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2. Tennessee Good Neighbor Recognized!

Mary E. Bacon, a REALTOR with Bob Parks Realty in Mt. Juliet and a member of the Eastern Middle Tennessee Association of REALTORS, has been named one of the ten (10) NATIONAL finalists for the National Association of REALTORS’ Good Neighbor Award!

Mary was recognized for her work with the Mt. Juliet Help Center. The Mt. Juliet Help Center provides food and assistance to those in need. In 2006, after serving the community for decades, the Center lost its lease and was forced to shut down. But Bacon knew the need for the Center was great, so she located office space and manned the Center herself for 6 months in a 10×12-foot room. By 2007, Bacon had persuaded the community to donate land and a modular building to give the Center a permanent home. Today, with Bacon as president, the Center has two employees and serves 400 families a month with food and emergency assistance for utility bills, gas and prescription medicine.

Thanks and congratulations to Mary Bacon!

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3. HOT LINE: Submitting Verbal Offers

QUESTION: What is the law regarding presenting “verbal” offers? I highly object to them and tell buyers that there’s much more to an offer than price, etc. and 99% of the time I am able to get things in writing. But every now and then, I get a buyer who insists on making a verbal offer. What are the rules regarding my responsibility to present these offers (sometimes they are ridiculous)?

ANSWER: A verbal offer is technically a valid offer. However, we do not recommend doing this. We always recommend having offers presented in writing. This is because a contract for the sale of land in Tennessee must be in writing to be enforceable under the statute of frauds.  Furthermore, it must be signed by the person against whom it is to be enforced. In addition, there are so many different items to be addressed in the sale of real estate, that the offer should be in writing so that there are no disputes as to what the offer is.

You ARE, however, required to submit ALL offers. Pursuant to Standard of Practice 1-6 of the NAR Code of Ethics, “REALTORS shall submit offers and counter-offers objectively and as quickly as possible.”

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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4. HOT LINE: HOA Restriction Disclosure

QUESTION: I sold a condo recently, representing the buyer. I asked the listing agent if the property could be rented, and she said it could be; the MLS stated the same. I asked for the HOA docs from the listing agent, and they stated it could be rented. However, there was an amendment to the HOA docs and now the new owner can’t rent it. Should I have gone to the HOA to request the docs? The seller was actually on the HOA board and was aware of the restriction, but did not disclose such in the property disclosure. Do you have any suggestions on how to handle this matter?

ANSWER: You were completely reasonable to rely upon the information provided to you by the seller’s agent. Unless there was a reason for you to question the validity of the information you received or you told your buyer that you would get the information from the HOA, then you would likely not face any liability for this.

However, please be aware that there has been a new condo law passed which will go into effect on January 1, 2009. This law will make it much easier to get this information in the future. Under the new law, the seller must disclose the contact information of the HOA. Then, any prospective buyer or buyer’s agent can request, in writing, a CURRENT copy of these types of documents. TAR is working on a form for this purpose.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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5. HOT LINE Advisory: “Fixing” Commission Splits

AIt has been a while since we reminded everyone that brokers in a community may NOT agree on “commission splits” without violating federal antitrust laws! Just as with commission rates, fixing commission splits by common agreement is another form of price-fixing:

*** BEGIN QUOTE ***
A per se illegal price fixing conspiracy can involve not only the prices a firm charges customers or clients, but also the fees it pays for goods and services. In particular, listing brokers may not agree on the commission “split” to be paid to compensate cooperating brokers who produce a ready, willing and able buyer for a listed property. Conspiracies among competitors to fix the compensation paid to cooperating brokers may also be deemed per se illegal. For this reason, brokers must determine their cooperative compensation policies in the same unilateral and independent manner that they establish the commission or fees charged to clients. Listing and selling brokers may, of course, have occasion to discuss or negotiate the compensation they will pay to each other in connection with individual transactions. These negotiations, however, generally take place before an offer to purchase has been procured by the cooperating office, and in any event should never include a representative of a third office.
*** END QUOTE ***

For a more complete review of antitrust law, go HERE.

[SOURCE: NAR’s Legal Affairs Department]

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6. TREEF Trustee Nominees Announced

Nominations for Trustees of the Tennessee Real Estate Educational Foundation (TREEF) were announced last week by the TREEF Nominating Committee. The Foundation is governed by fifteen Trustees, most of whom serve staggered 3-year yerms.  The following were nominated for 3-year terms: Clarissa Hills (Kingsport), Sue Harris McClain (Jackson), Bobbie Noreen (Nashville), and Trasbin Stoner (Nashville). Outgoing TREEF President Sandra Tanksley (Brentwood) was nominated for a 1-year term.

Congratulations to the nominees!

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7. Rates Hold Steady

Freddie Mac reports that the 30-year fixed mortgage rate held steady at 6.52 percent during the week ended Aug. 14. However, rates on 15-year fixed loans fell slightly to 6.07 percent from the prior week. Meanwhile, the five-year adjustable mortgage rate dipped to 6.05 percent, and the one-year ARM dropped to 5.18 percent.

[SOURCES: Freddie Mac; Information, Inc.]

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TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

CONTENTS
1. Responding to Online Leads
2. Ethics Education Reminder & Clarification!
3. TAR Nominating Committee Report
4. HOT LINE: “Unrepresented” Buyers
5. HOT LINE: Advertising Someone Else’s Listing
6. HOT LINE: Security of Client/Listing Files
7. VIRUS WARNING: CNN Alerts
8. Rates Largely Unchanged

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1. Responding to Online Leads

With most buyers initiating their home searches online, it’s critical that agents master the new “etiquette” for dealing with Internet communications!

To help in this process, Michael Russer authored a recent contribution to REALTY TIMES — “Online Communication: Best Practices” — that specifically addresses how to respond to online inquiries and leads:

*** BEGIN QUOTE ***
Without question, the vast majority of new leads come from the Internet. And given today’s challenging market conditions, you want to treat these inquiries like they were precious new-born babes. Here are the online communication “Best Practices” you can easily implement to make sure each has the highest possibility of turning into a full-grown transaction.
*** END QUOTE ***

To read the complete article, go HERE.

[SOURCE: Realty Times]

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2. Ethics Education Reminder & Clarification!

There is NO “grandfathering” and there are NO exemptions for brokers or anyone else from the NAR ethics education requirement!

Between January 1, 2005, and December 31, 2008, every REALTOR in the nation must take an approved 3-hour ethics course (2.5 hours plus time for breaks) in order to remain REALTORS, i.e., members of the National Association of REALTORS.

Far too many folks are confusing this ethics education requirement with Continuing Education requirements that many licensees must meet for license renewal. This has NOTHING to do with licensing! Instead, this ethics education mandate applies to all REALTORS in the U.S. and determines your continuing eligibility for membership in your local, state, and national REALTOR organization.

Your local Association of REALTORS must certify your completion of the required ethics education and can inform you of opportunities — both classroom and online courses — that you can take to satisfy this requirement.

Even if you are exempt or grandfathered from taking any CE courses, you STILL must take an ethics course every four years!

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3. TAR Nominating Committee Report

The 2008 Nominating Committee for the Tennessee Association of REALTORS met on Wednesday, August 7, 2008 to consider nominations for 2009 TAR officers. The committee’s recommendations for election of officers for the Association in 2009 are as follows:

2009 President-elect — B.J. Swinehart, Knoxville
2009 Secretary/Treasurer — Emil Mongeon, Franklin
2009-2010 Division 1 Vice President — John Snyder, Memphis
2009-2010 Division 2 Vice President — Marlene Rakow, Columbia
2009-2010 Division 3 Vice President — Dwight Richardson, Cleveland

The actual election of TAR officers will take place on Thursday, Sept. 18, at the association’s Annual Convention in Chattanooga.

Congratulations to the nominees!

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4. HOT LINE: “Unrepresented” Buyers

QUESTION: We are in a small town. One real estate company is convincing buyers to sign the buyer’s representation agreement, but misrepresenting it in the process. The buyer then comes to us. We ask them if they are represented (to which they reply “no”), show them a house, and write a contract. THEN this other company calls and says they represent the buyer. This happens often and is really becoming a problem. Is there anything we can do to protect the rights of these buyers?

ANSWER: FIRST, in order to protect yourself, ask the prospective buyer if they have been TALKING TO another agent, rather than whether they are represented by another agent. If they answer yes, ask them if they SIGNED anything with that agent.

If you feel that another agent is not explaining the buyer’s representation agreement to these people, then you may be able to file a complaint with TREC. If the agreement was an exclusive buyer’s representation agreement, then they are likely in violation of the Real Estate Commission’s Rule 1260-2-.36 which states:

An exclusive buyer representation agreement is an agreement in which a licensee is engaged to represent a buyer in the purchase of a property to the exclusion of all other licensees. When entering into any such agreement a licensee must advise and confirm in writing to such buyer the following:
(1) that the buyer should make all arrangements to view or inspect a property through that licensee and should not directly contact other licensees;
(2) that the buyer should immediately inform any other licensee the buyer may come into contact with (for example, at an open house) that he or she is represented by the licensee; and
(3) whether the buyer will owe a commission in the event the buyer purchases a property without the assistance of the licensee through another licensee or directly from an owner.

From a purely logical standpoint, if the agent had explained the above, a buyer should not be contacting another agent and telling them that they are unrepresented.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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5. HOT LINE: Advertising Someone Else’s Listing

QUESTION: Is it legal or ethical for an agent with another company to advertise my listing without giving me credit?

ANSWER: An agent MUST indicate the actual listing company on the advertisement if he or she is going to advertise someone else’s listing.  Otherwise, this is misrepresentation in advertising, a violation of both Tennessee license law and the Code of Ethics. Furthermore, if the agent is using your photographs on the advertisement without your permission (photographs you took but did not give up the rights to), this could constitute a copyright violation.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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6. HOT LINE: Security of Client/Listing Files

QUESTION: Aren’t the files in the office for active listings, as well as contingents and pending, supposed to be kept locked in a secure location to preserve the privacy of the information contained therein?

ANSWER: This is not a rule per se. We have spoken with the attorney with TREC, and there is not a requirement that all files are required to be locked.  HOWEVER, IF those agents operate as Designated Agents, the information contained in these files is confidential from the other agents in your office.  Therefore, they should NOT be kept in a central location where everyone has access to them. If they are in a central location, they should be kept in locked file cabinets, with access restricted to the Designated Agent for each client there.

If Designated Agency is part of your company policy — ask your managing broker if you are unsure about this — then the confidentiality of each client’s information MUST be protected …since someone else in the office may represent the other party in a transaction involving that client.

[SOURCE: TAR’s Legal & Ethics Hot Line Attorneys]

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7. VIRUS WARNING: CNN Alerts

TAR DIGEST readers send us MANY virus alerts, most of which prove to be false or outdated, once we check them out. This one’s real! As of this past Friday…

*** BEGIN QUOTE ***
The massive attack that has infected PCs by tricking users into clicking links in fake messages from CNN.com shows little sign of ending soon, security researchers said on Friday.

…on Friday, Websense Inc. reported that its researchers had seen the attack mutating, with the spam subject heading not only touting “CNN Alerts: My Custom Alert,” but also using legitimate news stories culled from CNN to make the messages more convincing.

Users who clicked on the “FULL STORY” link in the message were redirected to a fake CNN site, where they were told they needed to download an update to Flash Player, Adobe Systems Inc.’s popular Internet media player, to view a video clip from CNN.

…If users agreed to download the bogus Flash update, they were trapped in an endless loop, where clicking “Cancel” in the initial dialog produced a second pop-up. Clicking “Cancel” there returned the user to the first pop-up. The only options at that point were for users to shut down the browser or give in and install the malware.
*** END QUOTE ***

If you see a message come into your inbox with the SUBJECT heading “CNN Alert,” delete it immediately! Don’t open it and — by all means — don’t click on any links within the message!

[SOURCE: PC World]

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8. Rates Largely Unchanged

Freddie Mac reports that long-term mortgage rates held steady during the week ended Aug. 7. Interest rates on 30-year fixed loans were unchanged from a week earlier, at 6.52 percent, but were down slightly from 6.59 percent at this time last year. Movement on borrowing costs for other types of loans was mixed, with the rate on 15-year fixed mortgages bumping up to 6.10 percent from 6.07 percent but the average interest on adjustable-rate products dipping. One-year ARMs dropped to 5.22 percent from 5.27 percent, while five-year ARMs settled at 6.05 percent compared to 6.07 percent last week.

[SOURCES: Freddie Mac; Information, Inc.]

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TO SUBSCRIBE to the TAR DIGEST: Simply go to the TAR DIGEST website at www.tardigest.com with your web browser, and look down the left-hand column of that page for “Get News By E-Mail”. Click on that and follow the instructions.

After entering your email address, you will receive an email from the system (confirmations@emailenfuego.net) with a link that you MUST click on, to activate your subscription.  Thanks!

TAR’s Home Page: http://www.tarnet.com

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CONTENTS -
This newsletter focuses on TransactionDesk, TAR’s online forms and transaction management platform. 

1. How can you upgrade from the LITE to FULL version of TransactionDesk?
2. Using a Tablet PC for Digital Signatures - even in TransactionDesk
3. Integrating Top Producer or Outlook contacts with TransactionDesk
4. How does changing Offices affect your TransactionDesk account
5. TAR Tech Support

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1. How can you upgrade from the LITE to FULL version of TransactionDesk?
Each TAR member can access the FREE version of TransactionDesk (the Lite version). If you would like to upgrade to the FULL version ($129 annual subscription), simply log in to TransactionDesk and follow the steps:

1. Click on the “STORE” link in the navigation bar
2. Click on the “Login” link
3. Click on the “New Members Can Sign Up Here” Link
4. Create your Storefront Profile
5. To purchase the UPGRADE, click on the “CATEGORIES” link on the left
6. Click on the “Upgrades” link
7. Then, click on the TransactionDesk Upgrades link
8. Select the “Add to Cart” button

Then proceed to check out like any other normal web store.

Below is a feature comparison of LITE vs. FULL version of TransactionDesk for TAR members:

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2. Using a Tablet PC for Digital Signatures - even in TransactionDesk

The FULL version of TransactionDesk allows for use of a Tablet PC. Tablet PC’s are known for the ability to sign on the screen with a stylus and the capturing and transferring of that signature to a digital document.

For those of you who have a Tablet PC and are using TransactionDesk (FULL version ONLY), you can upload any document to the DocBox of TransactionDesk. Simply select the document that is in the DocBox and then choose:

I would like to:  SIGN DOCUMENT WITH A TABLET PC

NOTE: This feature is only offered in the FULL version of TransactionDesk.

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3. Integrating Top Producer or Outlook contacts with TransactionDesk

Did you know you have the capability to integrate either Top Producer OR Outlook “contacts” with TransactionDesk? You can do so easily. It’s done through an “Import / Export” procedure. However, there is only one caveat. Top Producer can ONLY import into TransactionDesk. It can not export out of TransactionDesk back to Top Producer. Conversely, Outlook can go both ways (import/export).

For TOP PRODUCER,  click on the SETTINGS tab in TransactionDesk, then click on “My Preferences” and then click on “User Information”. On the resulting page, you will see “Top Producer Data Services Setup”. Just fill in the information.

For OUTLOOK,  click on the “Contacts” link in the navigation bar. Locate the “I would like to:” drop down menu. Select “Import/Export Utility”and follow the steps from there.

NOTE: This is not a “sync” feature and therefore importing and exporting of data may cause duplication of data if you’re not careful. 

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4. How does changing Offices affect your TransactionDesk account

TAR pulls your member profile data from the National Association of Realtors Database (a.k.a “NRDS”). It is important that this information is correct in NRDS. All local associations in Tennessee are known as “points of entry” (POE’s). The POE inputs and corrects your information and then uploads it to NRDS and then TAR downloads it making TAR a third party to the data.

You must make sure that when you change offices, that your local association is informed in a timely manner and can “change” your information in NRDS accordingly. Once the information is changed in NRDS it should take no longer than 2 days for that change to be reflected in the TransactionDesk database.

If the information is incorrect in NRDS it will be incorrect in TransactionDesk - “garbage in… garbage out”.

NOTE: If you have a company logo that needs to be changed during this process contact logos@instanetforms.com and ask them to remove the “OLD” company logo.

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5. TAR Tech Support

If you need technical help with the TAR web site and/or TransactionDesk, TAR has  a dedicated phone line that you can call Monday - Friday, 8:30 a.m. - 4:30 p.m. (CST):

615-440-5052

The TAR technical support team is well versed with TransactionDesk. However, there are times in which the question may need to be forwarded to the development team at InstanetSolutions, the online forms vendor.

In addition, you could use the online “Help Desk and Knowledgebase” located in the Member Services area of the TAR web site. By selecting TransactionDesk as the help category, simply fill out the form with your question and submit your help request to the TAR technical support team. You will be notified by email automatically when your question has been answered. All your questions and answers are archived for your personal use at any time.

 NOTE: The Help Desk can be used for Legal and Ethical questions and Educational questions.