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


CONTENTS
1. The Numbers Confirm Tennessee’s Appeal!
2. NAR’s Legal Resources for You
3. TAR Welcomes New Staff Member!
4. HOT LINE: Agency Representation & Teams?
5. HOT LINE ADVISORY: More on License Tags
6. ALERT: E & O Delinquency
7. Upcoming Events & Courses
8. Rates Hit NEW Record Low!


1. The Numbers Confirm Tennessee’s Appeal!

Despite the economic turmoil swirling in much of the country, Tennessee is attracting more movers and will likely continue attracting new residents, according to a new Relocation.com study.  Relocation.com, an online consumer resource for moving services, analyzed nearly 500,000 requests for moving services in 2008 and found that 58 percent of all interstate move requests for Tennessee involved people who wanted to move to Tennessee from another state; 42 percent involved people who wanted to leave Tennessee for another state.

[SOURCE: Relocation.com]


2. NAR’s Legal Resources for You

The National Association of REALTORS (NAR) has initiated a “Right Tools, Right Now” campaign, to make many tools and resources available to members and their associations, either for FREE or AT COST.  This includes some very useful and valuable legal resources from NAR’s Legal Affairs Department!

To explain what legal resources are available to you, NAR’s General Counsel Laurie Janik is featured in a new six-minute podcast that you can listen to online, or download if you wish. Your dues have paid for this service, so take advantage of it!

To access this new April podcast from NAR, go HERE.

[SOURCE: NAR]


3. TAR Welcomes New Staff Member!

The Tennessee Association of REALTORS (TAR) is pleased to welcome Chris Sexton as our new Director of Governmental Affairs! As many members already know, our previous Director of Governmental Affairs, J. Bucy, served us well but recently resigned to tackle a new challenge.

For the past two and a half years, Chris Sexton has served as the Public Affairs Director for the Chattanooga Association of REALTORS. In that role, Chris handled both government affairs and public relations responsibilities for the association’s membership in both Southeast Tennessee and Northwest Georgia. Prior to joining the REALTOR family, he worked in the political arena in the State of Michigan. Chris helped local, state and national campaigns with operations that included grassroots organizing, polling, message development and fundraising.

We know that our members will find Chris Sexton to be an excellent resource!


4. HOT LINE: Agency Representation & Teams?

QUESTION: Could you please clarify an agency question for my office? TREC does not recognize the team concept, but as you know many Licensees have teams or are part of a team. If a member of the team or the team leader has a listing and is the designated agent for the seller, would another member of the team that sells the listing also be considered the designated agent for the seller? The selling licensee has a vested interest in the sale just like a husband and wife since the listing agent/team leader retains a portion of the selling side of the commission. (This is like a company within a company.) This may be confusing, but we need to make sure clients are properly represented.

ANSWER: Teams are allowed in Tennessee. However, TREC does not have any specific rules governing how they operate. That being said, there are some guidelines which they follow in regulating teams. First, if one team member is a designated agent for a client, then the entire team should be the designated agent for that client. Therefore, all members must be listed on the listing agreement or buyer’s representation agreement. In addition, anything that one team member knows, all team members are assumed to know (think adverse facts). This can be dangerous in the event that the team does not communicate well. If the team represents the buyer and the seller in a transaction, then they ALL would need to default to facilitator, or disclosed dual agency, depending upon company (not team) policy.

It is also important that any advertising not be misleading. Therefore, the team name should not give the impression that the team is a stand alone real estate company. Also, the firm name and telephone number must also appear on any advertising. Although it is not technically required, we would also recommend including the team members’ names on advertising to make things easier on the public.

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


5. HOT LINE ADVISORY: More on License Tags

There is much confusion concerning whether real estate agents are required to have commercial tags on their automobiles. Statutes governing the registration of vehicles and obtaining car tags are overseen by the TN Department of Revenue and are contained in Tenn. Code Ann. 55-4-101, et seq. We have spoken to the Department of Revenue for guidance on this issue.

Pursuant to Tenn. Code Ann. 55-4-105(e):

(1) The holder of a valid and outstanding certificate of registration for a noncommercial vehicle shall apply for its renewal through the office of the clerk of the county of the owner’s residence. The registration issued for a commercial vehicle may be renewed through the office of the clerk of the county of the owner’s principal place of business within the state, or of the county of incorporation in the case of a corporate owner or of any other county in which the owner or corporate owner maintains an office or place of business. Any applicant for the renewal of a registration under which the fee is to be prorated or apportioned and any nonresident for renewal shall, within the discretion of the commissioner, make application directly to the division.

(2) For the purposes of this subsection (e), “commercial vehicle” means any vehicle that is operated in the furtherance of any commercial enterprise; provided that vehicles with Tennessee Association of Realtors new specialty earmarked license plates shall be deemed not to be commercial vehicles.

PLEASE note Paragraph (2). If you are operating your vehicle in furtherance of your job as a real estate agent (not necessarily limited to those using magnetic signs), then your vehicle must be registered as a commercial vehicle according to this statute.

There is one exception. As an alternative, you may obtain a REALTOR tag and be exempted from obtaining a commercial registration. The legislation granting approval for the Realtor(R) tag does contain an exemption within it so that real estate agents are not subject to having to have commercial registration as required in Tenn. Code Ann. 55-4-105(e) above. See Tenn. Code Ann. 55-4-310(d) which states “Notwithstanding any provision of part 1 of this chapter to the contrary, motor vehicles that are registered with Tennessee Association of REALTORS new specialty earmarked license plates shall be deemed not to be commercial vehicles.” If you do not have one of these tags on your car and you use the car for the furtherance of you real estate profession in any way, then by the above statute, you are required by law to register that vehicle as a commercial vehicle.

The REALTOR tags are not yet available. Therefore, if you are presently using your vehicle in furtherance of your real estate profession, then by the black and white language of the law, you are required to have commercial tags. This law has been in force for quite some time, but it has recently come to our attention that it is now being enforced in certain parts of the state.

If you have any further questions or comments about this or any other Hot Line Questions and Answers, please contact the TAR Hot Line directly at: .

P.S. The REALTOR tags were NOT created as a moneymaking gimmick by TAR, as a few emails have claimed! Legislation authorizing the creation of these tags was requested by our REALTOR members, and approximately 2000 REALTORS petitioned TAR to pursue this issue. Any net proceeds from the sale of these tags go NOT to TAR, but rather to our nonprofit educational foundation, TREEF.

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


6. ALERT: E & O Delinquency

Now that the staggered licensing program is fully implemented, everyone’s license has a different expiration date. It is up to the LICENSEE to make sure that their E & O insurance is current and up-to-date as well!

If a licensee failed to renew the E & O insurance on or before the expiration date of their policy, then BOTH the affiliated licensee AND the Principal Broker may be assessed civil penalties.

According to the records of the Tennessee Real Estate Commission (as of 4/6/2009), 874 active licensees in Tennessee do not have a current conforming E & O policy (or have not properly notified TREC as to their E & O coverage)!

PLEASE NOTE: The Principal Broker of any licensee who has failed to renew an E & O policy prior to the expiration date, may release the licensee during the first 120 days after such expiration date (i.e., by April 30, 2009) and no longer be responsible for the penalty. The released licensee shall remain responsible for his penalty amount.

If a licensee has failed to renew an E & O policy for more than 120 days after the expiration date, then the Commission will pursue revocation of that licensee’s real estate license and the Principal Broker of the licensee must pay a civil penalty of $1000.00 per affiliated licensee who has failed to renew for more than 120 days after policy expiration. Both the licensee and the Principal Broker must also attend a two day meeting of the Tennessee Real Estate Commission. At this point, the Principal Broker will remain liable for payment of the $1000.00 per affiliate penalty even if the affiliated licensee is released.

TREC encourages each Principal Broker to take whatever steps he deems necessary to ensure that all affiliated licensees have a current E & O policy in place. For all licensees who had insurance with Rice Insurance Services Company, LLC (RISC), the state contracted carrier, the E & O insurance expired 12/31/2008 and needed to be renewed on or before 1/1/2009 for the 1/1/2009-12/31/2010 coverage period. If you want to double check any information concerning licensee coverage, you may call RISC at (800) 637-7319 and one of their representatives will be able to help you. If your firm or any of your affiliated licensees have alternative E & O coverage, then you should call that specific carrier and have them verify insurance information.

The Tennessee Real Estate Commission has sent out a letter to all brokers in Tennessee outlining requirements and penalties in greater detail.

QUESTIONS?
Questions about this reminder may be directed to the Tennessee Real Estate Commission at 615-741-2273 or toll-free at 1-800-342-4031.

[SOURCE: TREC]


7. Upcoming Events & Courses

NEW ADDITION TO SCHEDULE: See April 21 Core Course below!

April 7-8: GRI 5 – Systems for Success (Cool Springs), 16 hours CE. For more information, go HERE.

April 16: E-Class GRI 5 – Systems for Success (a 5-week distance-learning course) begins – 16 hours CE. For more information, go HERE.

April 21: 2009-2010 Core CE Course (TAR Office, Nashville), 4 hours CE. For more information. go HERE.

April 22-23: Leadership TAR Retreat #1 – Authentic Leadership, held at Montgomery Bell State Park. This retreat is full, and registrations are closed for this one.

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


8. Rates Hit NEW Record Low!

Freddie Mac reports that rates on 30-year mortgages fell to the lowest level on record for the second consecutive week. This week, average rates on 30-year fixed-rate mortgages declined to 4.78 percent, down from 4.85 percent a week ago. Refinancing activity has picked up because of the low rates, and the Mortgage Bankers Association says approximately 80 percent of mortgage applications came from borrowers seeking to refinance.

[SOURCES: Freddie Mac; Information, Inc.]


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

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