The 1-31-12 Newsletter of the Tennessee Association of REALTORS
Editor: Pug Scoville

1. Low Rates To Continue
2. Cash Buyers Are Pushing Prices Lower
3. Recent Survey Reveals Agent Woes
4. HOT LINE: Paying an Agent for Leads?
5. HOT LINE: Agreement With No Expiration Date?
6. HAPPENINGS – This Week and Next
7. Register for TAR Spring Conference!
8. Rates Rise a Little
9. Useful Web Links
10. Using the TAR HOT LINE

To ask a TAR Legal and Ethics Hot Line question, go to:

For other questions about this newsletter, please use the “CONTACT” form at:

1. Low Rates To Continue

The Federal Reserve announced that it intends to keep rates at their record lows at least through the end of 2014 and that their targeted inflation rate is to be 2%. The Fed announced its intention to be more transparent in communicating the direction of its rate guidance and the factors that it uses to measure the economy’s performance.

The news that rates will stay low will help most every facet of the economy including housing. News out this past week that first time claims for unemployment rose unexpectedly in the previous week adds fuel to those who believe that the economy is a long way from being cured.


2. Cash Buyers Are Pushing Prices Lower

A December survey by Campbell Inside Mortgage Finance found that cash buyers are driving down home prices, with investors accounting for one out of three transactions last month.

Nearly three-quarters of investor home purchases for the month were all-cash transactions. The poll also determined that cash buyers were able to make purchases at much lower prices on many houses due to shorter and more reliable closings.

The Campbell survey is taken monthly and polls more than 2,500 real estate agents doing business across the U.S., which has been taken since 2001.

To read more, go to:

[SOURCE: Housing Predictor]

3. Recent Survey Reveals Agent Woes

Of 800 real estate agents and brokers surveyed by Entitle Direct, 9 percent have been forced to sell their own homes, 9 percent lost their homes to foreclosure, and 10 percent had to downsize due to the economic downturn.

The title insurer also found that 88 percent of respondents dealt with significant financial losses over the last four years, and 78 percent are concerned about their retirement. Moreover, only 11 percent expect a market upswing in the near future; while 47 percent expect market conditions to worsen. “Our survey shows that both personally and professionally, [real estate professionals] have had to make significant sacrifices to adapt to the new environment,” says Entitle Direct CMO Paula DeLaurentis.

To read more, go to:

[SOURCE: Housing Wire]

4. HOT LINE: Paying an Agent for Leads?

QUESTION: We have an agent in our office who has retired and whose license is in inactive status. We want to offer her compensation for leads generated from her client list. We have come to terms with her and want to pay her 25% on anything sold using one of her clients. What is the legal way to go about this action?

ANSWER: Unfortunately, this is not possible under Tennessee law. An agent can be compensated even after retirement AS LONG AS the contract was in place while their license was active. Therefore, the agent cannot be compensated for contracts entered into after their retirement.

In the future, another option would be to purchase the leads from a retiring agent while her license is still active. This would be permitted.

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

5. HOT LINE: Agreement With No Expiration Date?

QUESTION: I have an agent who represents a buyer. They got the buyer to sign a Buyer’s Rep Agreement. On the agreement, the start date is noted but the expiration date is not. Is this a valid agreement?

ANSWER: Pursuant to Tenn. Code Ann. 62-13-312(b)(9), an agent can be disciplined under Tennessee law for “Using or promoting the use of any real estate listing agreement form, real estate sales contract for, or offer to purchase real estate form which fails to specify a definite termination date.”

In addition, there could be some issues in enforcing it without a termination date. A court could do one of two things – 1. say there is no agreement or 2. determine that there was an agreement, but that it was for a “reasonable period of time”. The question then becomes what is reasonable. The best course of action at this point is to execute an amendment to the agreement in which everyone agrees to a time period.

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

6. HAPPENINGS – This Week and Next

Feb. 6: DEADLINE for NAR Director Applications

Feb. 7: 2011-2012 Residential Core Course (6 hrs. CE) – CAR Office, Clarksville. For more information or to register, call: 931-552-3567

Feb. 9: 2011-2012 Residential Core Course (6 hrs. CE) – EMTAR Office, Mt. Juliet. For more information or to register, go to:

Feb. 9: REBAC’s Short Sales & Foreclosures Course (8 hrs. CE) – MAAR Office, Memphis. For more information or to register, go to:

Feb. 10: REBAC’s Broker’s Price Opinion (BPO) Course (6 hrs. CE) – GNAR Office, Nashville. For more information or to register, go to:

For information on the NEW 2012 GRI Program, go to:

NOTE: E-Class GRI courses are NOT webinars and they are NOT “online” courses in the way that most people think of online courses. How do E-Class courses work? Go to:

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

7. Register for TAR Spring Conference!

Registration is now open for the 2012 TAR Spring Conference, at the Cool Springs Marriott just south of Nashville. This is traditionally our largest meeting of the year, and the 2012 Spring Conference offers a great education program! TEN hours of education in all!

The early-bird registration fee (for TAR members) remains a low $75! So reserve your spot NOW! For more information on the TEN hours of education offered or to register, go to:

8. Rates Rise a Little

Average interest on 30-year fixed mortgages rose to 3.98 percent this past week but remained below 4 percent for the eighth week in a row, reports Freddie Mac. A week earlier, the benchmark fell to 3.88 percent, its lowest level ever. The average rate on 15-year fixed loans also bumped up, floating to 3.24 percent from 3.17 percent last week, after falling to a record low of 3.16 percent two weeks ago.

[SOURCES: Freddie Mac; Information, Inc.]

9. Useful Internet Links

To access:

Back Issues of the TAR DIGEST:

Tennessee Assn. of REALTORS:

TAR Education:

Follow TAR on Twitter at:

TAR’s LinkedIn page:

TAR’s page on Facebook:

Online Risk Reduction Resources:

Online Resources for Association Leaders:

Tennessee Real Estate Commission:

10. Using the TAR HOT LINE

The TAR Legal & Ethics Hot Line is a FREE member service designed to answer members’ real estate related legal questions, as well as questions concerning the REALTOR Code of Ethics. It is designed for members to have direct toll-free access to a qualified attorney and is intended to provide legal preventative maintenance to all TAR members.

Note that your Managing Broker will always be copied on the response to any help request forwarded to the TAR Legal & Ethics Hotline. In addition, any inquiry handled by the TAR Legal & Ethics Hot Line does not result in attorney-client relationship. The Hot Line is also NOT a source of legal advice for your customers or clients. The Hot Line is simply a source of legal and ethical information for TAR members, and no attorney-client relationship is intended or implied when a Hot Line attorney responds to an inquiry.

To contact the Hot Line:

Hours of Operation: M-F, 9:00am – 5:00pm CST
Local to Nashville: 244-3344
Not Local: 800-899-5297
Members HELP DESK (Log In under the “Member Services” navigation link)