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

1. First-Time Buyers Could Boost Sales!
2. The THDA Stimulus Second Mortgage Program
3. Changes in TAR Forms
4. HOT LINE: Senior Communities & Fair Housing?
5. HOT LINE: Multiple Offers on a Short Sale?
6. A Survey on TAR’s Services (Please respond!)
7. Upcoming Courses & Events!
8. Rates Fall to Record Low

Remember the FREE Referral Expo, May 18-29! See Upcoming
Courses & Events below for more information.

1. First-Time Buyers Could Boost Sales!

The National Association of REALTORS says over 50 percent of March’s home sales were tied to first-time buyers, many of whom snapped up foreclosed homes and other distressed properties. Experts believe getting first-time buyers off the sidelines to take advantage of historically low interest rates and federal tax credits will reduce the glut of homes on the market and spark a recovery, and some point out that first-time buyers are helping to revitalize communities in Florida, California, and other states hit hard by foreclosures. However, distressed properties often sell for 20 percent less than traditional dwellings, and the increase in lower-end sales is driving down the national median home price.

[SOURCES: USA Today; Information, Inc.]

2. The THDA Stimulus Second Mortgage Program

Earlier this year, Congress passed the American Recovery and Reinvestment Tax Act of 2009 (“2009 Tax Act”). In division B, Title I, Section 1006, there is a provision for a First Time Homebuyer Tax Credit (Form 5405) up to $8,000 or 10% of the purchase price. This act provides for an exception for principal residences purchased between January 1, 2009, and November 30, 2009, which enables a first time homebuyer to receive the tax credit with no repayment required if the homebuyer occupies the property for 3 years. The 2009 Tax Act also provides for use of this credit with loans purchased with proceeds of tax-exempt mortgage revenue bonds. Therefore, this credit can now be used with THDA’s mortgage programs.

THDA now has a new second mortgage program, the THDA Stimulus Loan Program, for downpayment and closing cost assistance. This program will complement THDA’s existing Homeownership Choices incorporating the tax credit. In order to be eligible for the second mortgage program, THDA MUST be providing funding for the first mortgage through the Great Rate or Great Advantage programs for the borrower(s) to purchase the home. Both the first and second mortgage must close on or before November 30, 2009. The November 30, 2009, date also applies to new construction. The new home must be complete and the loan closed on or before November 30, 2009.

For program terms and details, go HERE.


3. Changes in TAR Forms

The TAR Standard Forms Inventory will be updated and modified 5/18/09.

ALL FORMS are being revised to include line numbering for every signature area on each form. This includes both residential and commercial type of forms. In addition, some forms were identified with typographical errors. These have now been fixed. We do not anticipate another change in forms until January of 2011. That’s right – 2011.

Both “TransactionDesk” and “Forms on the Fly” will be updated on 5/18/09. Some forms have also been shortened in page length due to the update and reformatting of TAR forms. Some new forms to look for are Short Sale forms and a new Buyer Agency form.

Documentation of the changes will be available on 5/18/09. As always, anytime there is a change to any TAR form, it is advised that you use the most current version of a TAR standard form. Use of older versions of TAR forms are to be used at your own risk.

A TransactionDesk Basic Course has also been scheduled for Wednesday, May 13 at the TAR Office, following a TAR Forms 101 Course on Tuesday, May 12. For information on BOTH courses, see Upcoming Courses & Events below.

4. HOT LINE: Senior Communities & Fair Housing?

QUESTION: I need to know whether or not the following, when placed in an ad, comply with the Fair Housing Act:
1) Senior Community
2) Retirement Community
3) Independent Living

ANSWER: There are special exemptions for advertising for communities for older persons. However, the community must meet certain criteria. First, the housing must be intended and operated for occupancy by at least one person who is aged 55 years or older per unit. It also requires that the community have in place a system to verify age. If the housing qualifies under the Housing for Older Persons Act, then it may be advertised as targeting individuals who fit into the category of older persons (i.e., 55+ years of age). At least 80% of its occupied units must have at least one person of 55 years of age or older in residence.

HUD has published on its website a list of Frequently Asked Questions which may be helpful. We would recommend going to:
…for more information on this subject. (Pay particularly close attention to questions 5 and 38.) It is very important before engaging in any advertising that you make sure that this community does qualify under the Housing for Older Persons Act.

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

5. HOT LINE: Multiple Offers on a Short Sale?

QUESTION: With regard to short sales, if a property is advertised as a short sale and the seller accepts a contract contingent upon lender approval, can the seller accept other offers on the property not intended to be backups?

ANSWER: We do NOT advise having the seller accept multiple offers, even if it is contingent upon the lender approving it. There is a chance that the lender could approve more than one contract and then the seller is legally bound to sell the property to two different buyers. The offer is an accepted contract once the seller signs it. While the contract is contingent upon the lender approving it, it is still a contract.

This situation will ultimately depend upon the Third Party Creditor’s (Lender’s) instructions. We would recommend presenting all offers to the Third Party Creditor. We would also recommend that if the Third Party Creditor wants multiple contracts that all but the first contract be back ups. This protects the seller from a possible disaster and could protect the agent from a breach of duty claim by the seller.

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

6. A SHORT Survey on TAR’s Services

A brief 5-question survey on TAR’s various services to YOU is being conducted this week. We really encourage ALL TAR members to take just a few moments to answer these five questions.

As we’ve previously announced, we are conducting a series of brief member surveys on TAR’s various services and programs, between April and June. The results of these surveys will be given to members of our TAR Executive Committee and TAR Strategic Planning Committee to help us plan for the future, with your valuable input!

This survey will close soon, so please respond no later than 12 Noon, on Monday, May 11. To take this survey, go HERE.

7. Upcoming TAR Courses & Events!

May 6-7: GRI 4 – From Offer to Contract & Closing (Cool Springs), 16 hours CE. For more information, go HERE.

May 7: E-Class GRI 6 – Sticky Situations (a 5-week distance-learning course) begins – 16 hours CE. For more information, go HERE.

May 7: RESPA Really Matters! (Memphis Area Assn. of REALTORS), 4 hours CE. For more information or to register, please go HERE on MAAR’s website.

May 12: TAR Forms 101 (TAR Office, Nashville), 4 hours CE. For more information, go HERE.

May 13: TransactionDesk Training (TAR Office, Nashville), 3 hours CE. For more information, go HERE.

FREE – May 18-29: Referral Expo 2009 an online educational opportunity featuring several national speakers, to help you build or REbuild your business! To learn more and register, go HERE.

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

8. Rates Fall to Record Low

Freddie Mac reports a drop in the 30-year fixed mortgage rate to a RECORD LOW OF 4.78 PERCENT during the week ended April 30 from 4.8 percent the prior week. While the 15-year fixed mortgage rate held steady at 4.48 percent, the five-year adjustable mortgage rate dipped to 4.8 percent from 4.85 percent. The one-year ARM slipped to 4.77 percent from 4.82 percent.

[SOURCES: Freddie Mac; Information, Inc.]

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