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


CONTENTS
1. Mortgage Fraud on the Rise
2. Convention AND Hotel Registration Deadlines
3. Congratulations to TN’s Good Neighbors!
4. Tennessee Second in Nation …for Bankruptcies!
5. HOT LINE: Offering a Buyer an Incentive?
6. HOT LINE: Terminating a Purchase and Sale Agreement?
7. GRI and Other Courses
8. Rates Go Even Lower

To ask a TAR Legal and Ethics Hot Line question, CLICK HERE.

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1. Mortgage Fraud on the Rise

Mortgage fraud — which peaked in 2006 — rose 17 percent last year after falling 57 percent in the prior two years, reports CoreLogic. Analyzing about 7 million home loans made by hundreds of lenders, the research firm found that $14 billion in loans were originated with fraudulent application data in 2009. Lenders have tightened criteria and look more closely at mortgage applications since the collapse of the real estate market; but fraudsters now are relying more on falsifying documents, recruiting loan officers and other bank insiders to work for them, and stealing identities to get loans.

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


2. Convention AND Hotel Registration Deadlines

Deadlines for BOTH TAR Convention registration AND hotel reservations for the Convention are upon us!

You have only until THIS WEDNESDAY, AUGUST 25 to make your reservation at the TAR Convention hotel in Memphis, the Downtown Marriott!

AND …You have ONLY ONE WEEK left to register for the TAR Annual Convention in Memphis (Sept. 15-17)! That deadline is AUGUST 30!

This promises to be one of the best TAR Conventions ever! Two keynote speakers, an array of outstanding national instructors, twelve hours of CE credit, the Voices of Lee, and a variety of other events should make this Convention one to remember!

For more information, CLICK HERE.


3. Congratulations to TN’s Good Neighbors!

Two of our members — Keri Kidd Cannon and Pam Kidd, with Fridrich & Clark Realty LLC in Nashville — were named (as a pair) one of the TEN (10) national finalists for the National Association of REALTORS’ 2010 Good Neighbor Awards!

This mother and daughter team have been helping people in Zimbabwe since 1999, traveling to this struggling African country more than 20 times. They founded Village Hope, a rural orphanage that cares for 20 children and also founded an outreach program for street children and homeless adults in the capital city of Harare. They feed 900 school children per day as well as hundreds of people from surrounding villages. Their agricultural programs provide seed corn and farm animals and teach farming techniques. They recently helped launched a dental clinic and are training locals to provide basic dental care.

Final winners will be selected in November of this year. Congratulations, Keri and Pam!


4. Tennessee Second in Nation …for Bankruptcies!

*** BEGIN QUOTE ***
Tennessee had the second-highest bankruptcy rate in the nation for the year ending June 30, according to data released today by the Administrative Office of the U.S. Courts.

Tennesseans filed bankruptcy at a rate of 8.33 per 1,000 residents, trailing only Nevada’s rate of 11.74 filings per thousand people. The national rate was 5.02 filings per thousand people. Personal bankruptcies — which totaled 1.57 million — were up 20 percent nationwide.
*** END QUOTE ***

[SOURCE: Nashville Business Journal]


5. HOT LINE: Offering a Buyer an Incentive?

QUESTION: What is the proper, legal way for a seller and an agent to offer a buyer incentive on the purchase of property?

ANSWER: We cannot advise you as to whether the seller is permitted to make this offer to potential buyers. The seller may want to check with his/her own attorney as to the legality of this and what the ramifications might be. If the seller goes through with offering an incentive, you need to make your mention of this in the MLS and any other advertising as specific as possible so as not to mislead the public. In addition, it must be clear that the incentive is being offered by the SELLER and NOT by the agent AND that it is contingent upon lender approval.

For your information, please be advised that many lenders do not like this practice. They typically will not approve the seller providing cash to the buyer at closing. However, they may allow the seller to pay a certain percentage of closing costs. At any rate, you will need to make sure that the lender approves any such incentive offered by the seller.

As we have reminded everyone before, as an agent you cannot give the person cash or anything which can be converted into cash. You are also not permitted to pay closing costs by TREC. TREC has determined that agents cannot pay closing costs for a party to the transaction under the Gifts and Prizes rule and statute.

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


6. HOT LINE: Terminating a Purchase and Sale Agreement?

QUESTION: I am looking for a form on TAR for a withdraw on a purchase and sale agreement. Please advise.

ANSWER: If you want to send notification of a party using their right to terminate under the contract for a failed contingency, then you can use the Notification form (F26). Number 3 on this form deals with inability to obtain financing. You can use this form in conjunction with form F30, Earnest Money Disbursement and Release form. Please be advised that F30 contains a complete release for both parties (no one can sue anyone on the contract).  However, based upon the language in form F30, you do not have to use this form. The buyers are simply entitled to receive their earnest money back with written notification which can be established with F26.

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


7. GRI and Other Courses

Courses starting this week:

Aug. 26 – Sept. 29: E-Class GRI 3, Financing the Successful Transaction (16 hrs. CE) – a distance learning course. For more information or to register, CLICK HERE.

Beginning later this month, readers of the TAR DIGEST will start receiving a twice-monthly TAR Education Calendar by e-mail, with courses being held during the next 30 days or so. Look for it in your email!

CLICK HERE for the complete 2010 schedule of Classroom and E-Class GRI Courses!

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


8. Rates Go Even Lower

Fixed mortgage rates have maintained recent lows or set new ones for more than two months now, sinking to 4.42 percent on 30-year loans for the week ended Aug. 19. The rate is down from 4.44 percent the prior week and is the lowest ever recorded since Freddie Mac launched its survey almost 40 years ago. The fixed 15-year average also hit a new low, at 3.9 percent; while five- and one-year adjustable-rate mortgages remained flat at 3.56 percent and 3.53 percent, respectively.

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


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