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


CONTENTS
1. Foreclosures Rise in Higher Price Ranges
2. Tennessee’s a Desirable Place to Live!
3. HOT LINE: Earnest Money Refund to Whom?
4. HOT LINE: Waiving a Home Inspection?
5. HOT LINE: Company Name on Signs?
6. Upcoming GRI Courses!
7. Long-Term Rates Closer to Record Low

To ask a TAR Legal & Ethics Hot Line question, go HERE.

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


1. Foreclosures Rise in Higher Price Ranges

New data from Zillow.com shows that about 30 percent of foreclosures in June involved residences in the top 33 percent of local housing values, a gain from 16 percent at the start of the foreclosure crisis in 2006. Meanwhile, the bottom one-third of housing markets, by home value, has dipped from 55 percent of foreclosures three years ago to 35 percent. Analysts fret that rising foreclosures among pricier properties could create additional pressure in a housing market that has shown signs of stabilizing of late, thanks to a rebound in lower-priced home sales.

The Mortgage Bankers Association adds that prime loans accounted for 58 percent of foreclosure starts in the second quarter versus 44 percent a year earlier, while subprime mortgages accounted for roughly 33 percent of foreclosure starts compared to 50 percent year over year.

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


2. Tennessee’s a Desirable Place to Live!

A recently released Harris Interactive poll asked Americans where they would choose to live if they did not live in the state where they are now. 2,498 U.S. adults were surveyed online between August 10 and 18, 2009, and Tennessee made the top 10!

1. California
2. Florida
3. Hawaii
4. Texas
5. Colorado
6. Arizona
7. North Carolina
8. Washington state
9. TENNESSEE
10. Oregon

Of course, we already knew that it’s great to be in Tennessee!

[SOURCE: Business Wire]


3. HOT LINE: Earnest Money Refund to Whom?

QUESTION: We have a single family listing. A company called “XYZ, LLC” out of Florida entered into a contract on this property, subject to a mortgage, with a $5,000 earnest money check from “XYZ, LLC.” The buyer (XYZ, LLC) was unable to secure financing. Therefore, we cut the earnest money check back to “XYZ, LLC” and mailed it to Florida. The owner of “XYZ, LLC” (or the party claiming to be the owner) called and said that “XYZ, LLC” is closed and is now out of business. He wants to send the check back to us and have us cut another check to him personally. This is the same man who signed the contract of sale as well as the earnest money check from “XYZ, LLC”. With the contract identifying “XYZ, LLC” as the buyer, am I safe to refund the $5,000 earnest money to the individual who signed the contract as well as the earnest money check?

ANSWER: You are only permitted to make the check payable to XYZ, LLC (the buyer on the contract). If the principal of this company does not like this answer, then the other alternative would be to interplead the funds and let the court determine to whom to make the check payable.

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


4. HOT LINE: Waiving a Home Inspection?

QUESTION: My buyer-clients have said that they don’t want a home inspection. How should I proceed?

ANSWER: While TAR form F48 (“Get a Home Inspection”) is not required, we would recommend that you have the buyer sign it. It outlines some of the different reasons that home inspections are a good idea. It also provides proof that you advised the buyers of the importance of a home inspection, yet they decided not to get one.

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


5. HOT LINE: Company Name on Signs?

QUESTION: On a listing sign, when is it appropriate for the company and phone number to be smaller than the agent’s name and phone number?

ANSWER: Pursuant to Tenn. Code Ann. 62-13-310(b), “Licensees may not post signs on any property advertising themselves as real estate agents unless the firm’s name appears thereon in letters the same size or larger than those spelling out the name of the licensee.” Therefore, no letter in the name of the company can be smaller than those of the name of the licensee. This rule applies only to yard signs.

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


6. Upcoming GRI Courses!

GRI 6: Sticky Situations — Oct. 15-16 (Knoxville, TN), 16 hours CE. For more information, go HERE.

GRI 5: Systems for Success — Oct. 22 to Nov. 25 (E-Class distance learning course), 16 hours CE. For more information, go HERE.

GRI 1: Professionalism in Real Estate — Nov. 5-6 (Nashville – Cool Springs, TN), 16 hours CE. For more information, go HERE.

GRI 6: Sticky Situations — Nov. 12 to Dec. 16 (E-Class distance learning course), 16 hours CE. For more information, go HERE.

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


7. Long-Term Rates Closer to Record Low

Thirty-year fixed mortgages moved closer to the all-time low of 4.82 percent reached in May, falling to 4.87 percent last week from 4.94 percent a week earlier, according to Freddie Mac. Homeowners who refinance have an opportunity to reduce their payment on a 30-year, fixed loan for $200,000 by nearly $134 a month from a year ago, when long-term rates averaged 5.94 percent. Also, 15-year loans fell to 4.33 percent, and five-year adjustable-rate mortgages dropped to 4.35 percent; but one-year ARMs rose to 4.53 percent.

[SOURCES: Freddie Mac; Information, Inc.]


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

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