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


CONTENTS
1. Another Idea for the Holidays…
2. Wondering About QR Codes?
3. Foreclosure Evictions Halted for Holidays
4. HOT LINE: Disclosure of Referral Fee?
5. HOT LINE: Owner/Seller Financing?
6. Upcoming Events and Courses
7. Rates Continue Inching Upward
8. Useful Web Links

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

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

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1. Another Idea for the Holidays…

If you don’t expect a lot of commission checks under your Christmas tree this year, a new article posted on the Broker Agent Social website by Denise Lones (“Holiday Cards? Again? Try This Instead…”) could help:

*** BEGIN QUOTE ***
We send out holiday cards as individuals, but as real estate agents I believe there is something better we should be doing.

Funny thing, most agents like sending out holiday cards. They really do. They feel like they’re creating a warm connection with their clients by doing so.

While there’s nothing wrong with a warm connection, don’t forget that you are a real estate expert first and foremost. You are not their neighbor, classmate, or co-worker. Do you really want to be put into the same category?

Let me answer for you: No, you don’t. In their minds, you want to be in a special category. You want to be known as “real estate expert”. You want every action you take to reinforce this belief. Sending holiday cards is NOT the way to do this.
*** END QUOTE ***

To read her entire article, CLICK HERE.

[SOURCE: Broker Agent Social]


2. Wondering About QR Codes?

While some real estate agents, companies, and franchises have already made the jump into QR Codes, others are still wondering, “What IS it?”

A recent article in Realty Times by Scott Pierce – “How to Use QR Codes for Real Estate” – offers a good, basic definition:

*** BEGIN QUOTE ***
A QR Code simply put is a bar code that allows people with smart phones such as iPhones, Androids, Blackberry’s and others to quickly scan the QR Code using a free QR Reader, and be taken to a website with content and more information about a particular property or agent.
*** END QUOTE ***

To read more, CLICK HERE.

One of TAR’s vendors, Sir Speedy, has also produced a well-done video (“QR Codes – Mobile Marketing for your Business”) and posted it on YouTube. It lasts just over 2 minutes and will give you a quick overview of QR Codes and where they’re headed. To view the video, CLICK HERE.

[SOURCES: Realty Times; Sir Speedy]


3. Foreclosure Evictions Halted for Holidays

Freddie Mac will suspend foreclosure evictions during the holiday season for the third straight year. Borrowers with mortgages backed or guaranteed by Freddie Mac will not be displaced from their homes from Dec. 20 through Jan. 3 of next year. Fannie Mae also plans to announce that it will temporarily stop foreclosure evictions until after the New Year.

[SOURCE: Associated Press]


4. HOT LINE: Disclosure of Referral Fee?

QUESTION: Is it necessary to disclose that a licensee has received or is receiving a referral fee for referring a buyer or seller to another broker? I know that is exempt from a RESPA disclosure but, due to the “Duties to all parties” in TN law, I’ve heard that this needs to be disclosed. What is required?

ANSWER: Actually, a referral of another agent is exempt from this requirement under the Broker’s Act. Tenn. Code Ann. 62-13-403(7)(B) states that agents have a duty to all parties: “Not recommend to any party to the transaction the use of services of another individual, organization or business entity in which the licensee has an interest or from whom the licensee may receive a referral fee or other compensation for the referral, other then referrals to other licensees to provide real estate services under the Tennessee Real Estate Broker License Act of 1973, without timely disclosing to the party who receives the referral, the licensee’s interest in such referral or the fact that a referral fee may be received.”

[SOURCE: TAR Legal & Ethics Hot Line Attorneys]


5. HOT LINE: Owner/Seller Financing?

QUESTION: With the new SAFE act in mind, I am trying to find out if I can structure a transaction whereby the Seller offers financing. The property to be sold is not the Seller’s residence and the Seller does not hold a mortgage license. The buyer is not related to the Seller nor does the buyer plan to use the property as a residence. In essence, it is more of a commercial transaction since both parties are investors. Would I be in violation of the act if I facilitated  the sale with owner financing?

ANSWER: TAR just received an opinion letter from the Commissioner of Financial Institutions. This letter clarified and provided some additional limited exceptions to the Tennessee Residential Lending, Brokerage and Servicing Act (Tennessee’s response to the federal SAFE Act). Prior to this letter being released on November 30, 2010, the only exemptions from licensure were if the seller was selling his residence or funding a loan for an immediate family member.

However, under this new opinion, there is a limited exception for individuals (this means that the person owns it in his own name – not that of a company such as an LLC, corporation, etc.). Pursuant to this letter opinion “For the present time and subject to a final rule, regulation, interpretation, or formal guidance of the federal S.A.F.E. Act indicating otherwise from HUD, the Department interprets an individual who, as a seller of his or her own real property, makes five (5) or fewer residential mortgage loans within any twelve (12) month period as exempt from the Mortgage Act. PLEASE TAKE NOTICE that, when and if HUD issues a final rule, regulation, interpretation, or formal guidance of the federal S.A.F.E. Act that is contrary to this position, the Department will have no alternative but to rescind its position and enforce said final rule, regulation, interpretation, or formal guidance. Thus, if HUD makes a determination that the Department’s position is inconsistent with the federal SAFE Act, the Department reserves the right to withdraw its position in order to be consistent with federal law.”

This letter opinion changes things somewhat. PLEASE bear in mind that you as the real estate agent CANNOT advise your sellers as to whether they meet these slim exemptions under the law. We would strongly recommend that this seller consult with his own attorney as reference this opinion letter from the Department of Financial Institutions dated November 30, 2010. In addition, you should understand that you as a real estate licensee CANNOT negotiate the terms of a mortgage on behalf of your seller. This would require a mortgage originator’s license. The seller should speak with his/her own attorney regarding the ever changing status of these laws.

[SOURCE: TAR Legal & Ethics Hot Line Attorneys]


6. Upcoming Events and Courses

Dec. 7: TAR Executive Committee Planning Session – TAR Office, Nashville.

Dec. 8: Leadership Session for Local Association Presidents and Presidents-elect – TAR Office, Nashville.

Dec. 9: RPAC/Government Affairs Training Session – TAR Office, Nashville.

Dec. 10: Homeownership Options Course (6 hrs. CE) – Murfreesboro. For more information or to register, CLICK HERE.

The complete 2011 schedule of GRI Courses (both Classroom and E-Class) is now posted HERE.

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


7. Rates Continue Inching Upward

Freddie Mac reports that fixed-rate mortgages rose for a third consecutive week during the period ended Dec. 2, as interest on 30-year loans inched up to 4.46 percent from 4.4 percent. Rates on 15-year mortgages averaged 3.81 percent, an increase from 3.77 percent a week earlier. Adjustable-rate mortgages were slightly higher as well, with the one-year ARM floating up to 3.25 percent from 3.23 percent and the five-year ARM settling at 3.49 percent compared to 3.45 percent.

[SOURCE: Freddie Mac]


8. Useful Internet Links

Click on any of the following to access:

Back Issues of the TAR DIGEST
Tennessee Assn. of REALTORS
TAR Education
Online Risk Reduction Resources
Online Resources for Association Leaders
Tennessee Real Estate Commission