The 4-17-12 Newsletter of the Tennessee Association of REALTORS
Editor: Pug Scoville


THIS WEEK & NEXT AT TAR
April 19-20: Leadership TAR Retreat #1
April 19 – May 23: GRI 412, Financing the Successful Transaction (16 hrs. CE) – An E-Class Course & GRI Elective

HOT LINES IN THIS ISSUE:
1. HOT LINE: TAR Forms Being Distributed to Consumers?
2. HOT LINE: OK To Mark Out Items on Property Disclosure Form?
3. HOT LINE: Is Owner Financing Now Illegal?

IN OTHER NEWS:
4. NAR Offers FREE Safety Webinar – April 19th
5. REMINDER: Nationwide Open House Weekend, April 28-29!
6. NAR & Lenders Oppose Restrictive Lending Rules
7. Average Mortgage Amount Jumps
8. About That Statue of St. Joseph…
9. Current Mortgage Rates
10. To Ask a Hot Line Question…

NOTE: If you are reading a hard-copy of this DIGEST, and want to access some of the links cited, simply go to http://www.tardigest.com to access the current issue with “live” links!

AND: To see a complete calendar of upcoming TAR courses around the state, go to: http://tnrealtors.com/calendar/index.php


1. HOT LINE: TAR Forms Being Distributed to Consumers?

QUESTION: I have seen a large increase in Realtors in our area giving TAR forms like the TN Property Disclosure, Purchase and Sales Agreements etc. to For Sale By Owners. I even have had these owners tell me that they have received all the info they need from other agents, referring to forms. Am I correct that we ARE NOT ALLOWED to distribute these forms unless we are doing the transaction under our name and brokerage?

ANSWER: You are correct! TAR forms are a benefit of being members of TAR. They are NOT to be disseminated to the public. They may only be used if you are involved in the transaction in one way or another. Please do NOT give them out to members of the general public with whom you are not working. They are copyrighted forms and their usage is protected by law.

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


2. HOT LINE: OK To Mark Out Items on Property Disclosure Form?

QUESTION: Is it okay for my sellers to mark out questions on the Property Condition Disclosure since they have condos and these questions (in their mind) do not pertain to condos?

ANSWER: You should be careful that you do NOT advise sellers on what they should disclose on the form itself. However, we would advise the seller NOT to mark through something on the form if it does not apply. The Property Condition Disclosure Form is largely mandated by state law. Therefore, if something does not apply to a particular property, advise them to simply write “n/a” next to the item.

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


3. HOT LINE: Is Owner Financing Now Illegal?

QUESTION: I have heard “Owner Financing” is now illegal, but I still see advertisements, etc., offering “owner financing”. What is the legal status?

ANSWER: Seller financing is a complex issue at the moment, but it IS legal at this point. There are several different federal laws and the state law which must be considered.

The first set of laws are the federal SAFE Act and the state Tennessee Residential Lending, Brokerage and Servicing Act at Tenn. Code Ann. 45-13-101 et seq. The premise of these two laws is to require that individuals who engage in the practice of mortgage loan origination for residential property be licensed by the state. Qualification for licensure requires education, passage of a standardized test, background checks, and a bond among other things. Each state was instructed to develop their own licensing system which would meet the federal requirements under the federal law. Tennessee complied with that requirement and passed the initial law in 2009. It initially only exempted a few classes of sellers from having to have a license for mortgage loan origination.

HOWEVER, it was recently amended to include more exemptions. This new law allows for both individuals and companies to act as seller/financer for up to 5 transactions in a 12 month period. It also allows for mortgages to be supplied by employers as employee benefits, relocation packages, etc. It also permits agents to be able to communicate the terms and include terms agreed upon by the parties within the contract. This DOES NOT mean that you can negotiate the terms or advise them on the benefits, etc., of the terms. You are merely permitted to relay information and to include the agreed-upon information within the contract. This was signed by the governor on May 20, 2011. Please note that all of these changes are subject to change in the event that they are deemed non-allowable by HUD.

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


4. NAR Offers FREE Safety Webinar – April 19th

TOPIC: Staying Safe at Open Houses!

Join safety expert Andrew Wooten on April 19 at 11AM Eastern Time as he shares a five-step plan for staying safe during open houses. Learn tips for preparing for, conducting, and closing up an open house plus much more. Register today by CLICKING HERE.

[SOURCE: NAR]


5. REMINDER: Nationwide Open House Weekend, April 28-29!

For one weekend in April — April 28-29 — REALTORS will hold open houses in neighborhoods from coast to coast, bringing value to both buyers and sellers! The event also provides a tremendous opportunity to promote the benefits of home ownership and continue an open dialogue with consumers about the housing issues that matter most to them.

NAR’s 2010 Profile of Home Buyers and Sellers shows that 45% of all buyers used open houses as a source in their home search process. This figure suggests the value of open houses even in the Internet era. This event was both popular and successful last year, and this year’s Weekend can be just as successful…especially in an improving market!


6. NAR & Lenders Oppose Restrictive Lending Rules

The Mortgage Bankers Association, National Association of REALTORS, and 31 other groups have sent a letter to the Consumer Financial Protection Bureau, warning that an overly restrictive interpretation of “qualified mortgage” lending rules will limit the availability of home loans and stifle housing recovery. The Dodd-Frank financial overhaul law requires the new rules, which are intended to protect consumers from risky loans and could be ready by summer. “An unnecessarily narrow definition…that covers only a modest proportion of loan products and underwriting standards and serves only a small proportion of borrowers would undermine prospects for a housing recovery and threaten the redevelopment of a sound mortgage market,” the organizations wrote. To read more, CLICK HERE.

[SOURCE: Wall Street Journal]


7. Average Mortgage Amount Jumps

The average home loan amount has swelled from about $215,000 to $235,000 over the past three months, according to Capital Economics, suggesting a thaw in mortgage lending. Paul Dales, an analyst with the research firm who co-authored the report, said the trend “may be an early sign that buyer confidence is improving.” To read more, CLICK HERE.

[SOURCE: Housingwire.com]


8. About That Statue of St. Joseph…

Some home sellers believe that burying a statue of St. Joseph — the patron saint of home and family — in the yard will help the listing to sell. The practice is believed to have begun in the Middle Ages, but there is disagreement surrounding the placement of the statue — whether the face should look toward the home to protect the family or toward the street to welcome potential buyers. Some real estate agents believe the statue should be buried upside down, as St. Joseph will want to “right himself” by locating a buyer. The Catholic Church does not disapprove of the practice but stresses that the statue should be dug up, cleaned, and placed in a prominent area in the owner’s next home. To read more, CLICK HERE.

[SOURCE: Chicago Daily Herald]


9. Current Mortgage Rates

To see current mortgage rates, go to: http://www.mortgagenewsdaily.com/mortgage_rates/


10. To Ask a Hot Line Question…

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