The Weekly Membership Newsletter of the Tennessee Assn. of REALTORS
Editor: Pug Scoville


CONTENTS
1. That $7500 Tax Credit!
2. HOT LINE: Eleventh-Hour Agency?
3. HOT LINE: Who Holds the Earnest Money?
4. What We SHOULD Be Discussing…
5. Creating Your Own “Winning Streak”
6. Rates Drop Again
7. UPCOMING EVENTS & COURSES

This issue of the TAR DIGEST “goes to press” on Monday. We encourage everyone to remember that Tuesday, Nov. 1, is Veterans Day! Please set aside time to reflect on the sacrifice of our veterans and those serving today, and honor them accordingly!


1. That $7500 Tax Credit!

One topic of conversation at the NAR Convention this past week was the $7500 tax credit for first-time buyers. Several speakers noted that more REALTORS need to understand this credit and how to explain it to their customers and clients!

To help you in this effort, RISMedia just published a helpful article — “The First Time Buyer $7,500 IRS Tax Credit: Why Isn’t There More Excitement?” — that’s worth your time:

*** BEGIN QUOTE ***
The $7,500 First-Time Buyer IRS Tax Credit applies to first-time buyer home purchases of a principle residence between April 9, 2008 and July 1, 2009. It is a tax credit and not a tax deduction. A tax credit is a reduction in income taxes owed! In other words, when a buyer files their income taxes for the year the home was purchased (2008 or 2009), they may be able to subtract $7,500 from the amount of federal income tax liability, which will either increase their tax refund or reduce the amount of tax still owed.

However, this tax credit is not free. It has to be paid back. Repayment begins two years after the credit is claimed, and must be repaid within 15 years. That’s $500 per year. Yes, it would have been much better if there was no repayment provision, but an interest-free loan for 15 years is not such a bad thing, is it? That’s right; there is no interest on the tax credit received.
*** END QUOTE ***

To read the entire article, go HERE.

[SOURCE: RISMedia]


2. HOT LINE: Eleventh-Hour Agency?

QUESTION: I have some clients who submitted an offer with a listing agent without my assistance. The offer has not been accepted, and now they want to sign a buyer’s representation agreement with me, but I think they have already signed something with the listing agent. Can they get their own representation now and sign the buyer’s rep agreement with me?

ANSWER: First of all, until you and they have actually signed an agency representation agreement, they are not truly your “clients” …they are your customers.

That being said, the buyers can sign a buyer’s representation agreement with you as long as they are not under another buyer’s rep agreement with another agent. However, this does NOT necessarily mean that you will receive the cooperating commission on this sale. You may still not be deemed to be the procuring cause of the sale. That would be for the local association of REALTORS to decide in arbitration. There are several factors provided by NAR for associations to consider when making a procuring cause determination.

If you DO decide to represent these buyers (and they are not under an agreement with another agent), make sure that they understand that you cannot be held responsible for anything that occurred before you began representing them (get this in writing). Also, make sure that they understand that you may NOT get the cooperating commission and any provisions for the buyers to pay you a commission in the event that you do not receive the cooperating commission.

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


3. HOT LINE: Who Holds the Earnest Money?

QUESTION: Regarding earnest money, it seems for years that the standard of practice in some parts of Tennessee has been to allow the selling agency to hold the earnest money on sales contracts. If the broker of one company decides that earnest should be held by the listing company as it is in many areas, can a listing agency trying to change the standard of practice require that the selling agency turn the earnest money over to the listing agency?

ANSWER: The holder of the earnest money is a term of the contract that is entirely negotiable between the buyer and seller. The agents are not the individuals who determine who holds the earnest money.

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


4. What We SHOULD Be Discussing…

As of this writing, the Board of Directors of the National Association of REALTORS (NAR) is still meeting, so we don’t have the Board’s final actions to highlight here, IF any of those actions are significant enough to report. [We’ll recap any truly important actions in next week’s issue!]

Meanwhile, an opinion piece by Walt Baczkowski (“What We Should be Discussing”), published by RISMedia last week, highlights three issues that dominated the “hall talk” he heard at the NAR Convention:

1. “Change does not happen in an up-market.”
2. “Don’t let someone else’s bad idea become your problem.”
3. “Interpretation of the data is more critical than the data itself.”

Whether you agree or disagree with Walt’s commentary, it makes for interesting reading and reflection.  To access it, go HERE.

[SOURCE: RISMedia]


5. Creating Your Own “Winning Streak”

Need a good pick-me-up?

This past week, RealtyTimes posted a new article by Julie Escobar — “Six Powerful Principals Creating Your Own ‘Winning Streak’ — that represents a good mix of practical, motivational, and attitudinal advice! Above all, she emphasizes the need to be and work IN THE PRESENT:

*** BEGIN QUOTE ***
Think about your daily conversations with colleagues, friends and neighbors. How many of those talks revolve around the glory days when the market and economy were both booming or the future “what-ifs” that have so many people paralyzed with fear? While we’re ALL guilty of occasionally having a foot in both of those camps, it’s important to note that life and success are often much like a raffle: You must be PRESENT to win!
*** END QUOTE ***

To read her article, go HERE.

[SOURCE: RealtyTimes]

_____________________________________________________
6. Rates Drop Again

Freddie Mac reports a drop in the 30-year fixed mortgage rate to 6.20 percent during the week ended Nov. 6 from 6.46 percent the previous week. Rates rose the prior week, reflecting volatility as a result of the credit crisis.

The 15-year fixed mortgage rate also declined, falling to 5.88 percent from 6.19 percent. Meanwhile, the five-year hybrid adjustable mortgage rate plunged to 6.19 percent from 6.36 percent and the one-year ARM dipped to 5.25 percent from 5.38 percent.

[SOURCES: Information, Inc.; Freddie Mac]


7. UPCOMING EVENTS & COURSES

Nov. 13 – Dec. 17: E-Class GRI 2 – Smart Marketing

Nov. 13-14: GRI 5 – Systems for Success (Nashville, Cool Springs area)

Nov. 17-18: GRI 4 – From Offer To Contract To Closing (Chattanooga)

Nov. 19-20: GRI 6 – Sticky Situations (Memphis)

Nov. 20: TREEF Meeting (TAR Office)

Dec. 3: 2009-2010 Core CE Course Instructor-Training (TAR Office)

Dec. 10: Leadership Session for Local Association Presidents & Presidents-elect for 2009 (TAR Office)

Dec. 11: Governmental Affairs Training Session (TAR Office)

To register for any GRI courses (E-Class or Classroom) or Instructor-Training offerings, or for more information about any of them, go HERE.


TAR’s Home Page: http://tnrealtors.com

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 () with a link that you MUST click on, to activate your subscription.  Thanks!