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

1. Action Needed NOW to Extend the Homebuyer Tax Credit!
2. HOT LINE: Two Offices, One Broker
3. HOT LINE: Two Termite Inspections
4. HOT LINE: Daughter Completing the Disclosure?
5. TIPS: Upgrading to Windows 7
6. Upcoming Courses & Events!
7. Rates Rise a Little; Applications Fall

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

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

1. Action Needed NOW to Extend the Homebuyer Tax Credit!

The tax credit is working, homebuyers are using it, sales have increased and it’s helping to move both housing and the economy forward.

But time is running out! Homebuyers have only a few weeks left to put in a contract on a house and benefit from the tax credit–it expires on December 1.

This week, the U.S. Senate will be voting on an amendment that would extend the first-time homebuyer tax credit. NAR is supporting the Dodd-Lieberman-Isakson Amendment because it will:

  • Provide the $8,000 tax credit to any buyer;
  • Set income limits at $150,000 for single buyers and $300,000 for married buyers; and
  • Make the credit available until June 30, 2010.

We need your help in reaching out to Tennessee Senators Lamar Alexander and Bob Corker. Please help us call them and ask them to support the Dodd-Lieberman-Isakson amendment.  The Senators are busy but you will be well served to talk to each Senator’s Tax Legislative Assistant.  Please feel free to share stories from your market telling exactly how the tax credit has helped you and other Realtors in opening doors to homeownership.

Phone Numbers:
Senator Alexander: (202) 224-4944
Senator Corker: (202) 224-3344

For more information and/or to use the REALTOR Action Center to respond to this Call to Action, go HERE.

It only takes a minute to respond, but it could mean a great deal to your business and to the real estate industry!


2. HOT LINE: Two Offices, One Broker

QUESTION: What are the rules with regard to a real estate broker running two (2) or more firms at the same time?  Can a broker run two (2) separate entitles at the same address?

ANSWER: A principal broker can be the principal broker for two different companies as long as they are in the same physical location.

This is based upon Tenn. Code Ann. 62-13-309(d)(1) that states: “If the applicant for a broker’s license maintains more than one (1) place of business within the state, the applicant shall apply for and obtain an additional firm license for each such branch office.”

We have spoken with the TREC attorney, and they interpret this as meaning that you can be the principal broker of two companies as long as they are in the same location. However, the affiliates must select only one company with whom to affiliate.

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

3. HOT LINE: Two Termite Inspections

QUESTION: I represent a seller in a transaction. We secured a contract on the property and the seller asked that I coordinate the termite inspection, which I did. The inspector came back and said there was a small area that needed to be treated. This infuriated the seller and the seller wanted a “second opinion.” The second termite company went out and found nothing. Now I’m not sure how to handle this situation. Am I obligated to give both reports to the prospective buyers or just the second one? I am concerned about future repercussions on this matter.

ANSWER: As a real estate agent, you are required as a real estate agent to disclose adverse facts.  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 an agent has actual knowledge of an adverse fact, he must disclose it. We cannot advise you as to whether the information you have provided constitutes an adverse fact. This is a judgment call on the agent’s part. If you feel that it is an adverse fact, you are required by law to disclose it. If the seller refuses to allow you to disclose an adverse fact, then you may need to release the listing. We would advise making any adverse disclosures in writing and having the buyer sign off on them.

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

4. HOT LINE: Daughter Completing the Disclosure?

QUESTION: My buyer has made an offer on a property. The owner has medical issues, but still resides alone in the house. Although her house has been listed for nearly three months, she has not completed a TN Property Condition Disclosure, but has completed a Lead Paint Disclosure. Our offer has been countered and we still have not received the Property Condition Disclosure. The listing agent is now suggesting that the seller’s daughter – who doesn’t live in the home – fill out the disclosure. The daughter does not have power of attorney or guardianship. Is this legal? Any suggestions as how to best handle this situation?

ANSWER: The seller of the property is the one who is to furnish the Tennessee Residential Property Condition Disclosure form pursuant to Tenn. Code Ann. 66-5-202. Therefore, the seller should be the one completing the form, not the adult child unless that child has the parent’s power of attorney.

In the situation where the seller is not competent and the person having power of attorney is selling the property, we generally recommend that the Disclaimer form be used. This is because there is not an exemption for this situation under the law. The seller has lived in the house for the last three years, but the one holding power of attorney does not have the requisite knowledge to complete the form. In this situation, the buyer would have to agree to this disclaimer and should run every test and/or inspection possible. If the seller is able, the seller should complete the form.

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

5. TIPS: Upgrading to windows 7

If you are a Windows user, then you probably know that Microsoft released its new operating system — Windows 7 — last week.  The TV commercials have been pitching it for some time.

You may have asked yourself: “Should I upgrade to the new system? Are the new features worth the hassle? What’s the easiest way to do it?”

Walt Mossberg, the Wall Street Journal’s Personal Technology Editor, and Katie Boehret have written three columns to answer these questions and help you out! If you run Windows, you need to go to:

[SOURCE: Wall Street Journal]

6. Upcoming Courses & Events!

2-day ABR Course — Oct. 28-29 (Knoxville Assn.), 16 hours CE. Sponsored by TREEF, offered by the Knoxville Area Association. For more information, or to register, go to: …and click on “Education”

1-day ABR Elective (“Foreclosure and Short Sales”) — Oct. 30 (Knoxville Assn.) 8 hours CE. Sponsored by TREEF, offered by the Knoxville Area Association. For more information, or to register, go to: …and click on “Education”

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. Rates Rise a Little; Applications Fall

Mortgage applications declined for the second consecutive week and to their lowest level in over a month, as interest on 30-year fixed loans rose to 5.07 percent. The Mortgage Bankers Association reports that its index of loan applications fell 13.7 percent last week, as requests to refinance mortgages sank 16.8 percent and demand for purchase loans fell 7.6 percent. Also, demand for home loans may be cooling because the deadline to use the first-time home buyer credit is approaching.

[SOURCES: Investors Business Daily; Information, Inc.]

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