The 8-14-12 Newsletter of the Tennessee Association of REALTORS
Editor: Pug Scoville


UPCOMING TAR COURSES & EVENTS:
Aug. 15: Residential Forms Committee Meeting – TAR Office, Nashville.
Aug. 20: GRI 402, Staying in Business and Out of Court (8 hrs. CE) – MTAR Office, Murfreesboro.
Aug. 23: TAR Budget and Finance Committee – TAR Office, Nashville.
Aug. 24: TAR Executive Committee – TAR Office, Nashville.

To see a complete calendar of other courses around the state, go to: http://tnrealtors.com/education/realtor-courses/

HOT LINES IN THIS ISSUE:
1. HOT LINE: Attaching Disclosures to Contracts?
2. HOT LINE: Resolution Period Is Blank?
3. HOT LINE: Multiple Offers on Short Sale Listing?

IN OTHER NEWS:
4. Alert About the TAR Convention Hotel!
5. A Video You Should Watch!
6. TN Closing Costs Are Average for U.S.
7. Builder Confidence in the 55+ Housing Market Is Up
8. About Your Listing Presentation…
9. Rates Inch Up Again to 3.59%
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!


1. HOT LINE: Attaching Disclosures to Contracts?

QUESTION: We have received a few contracts from other companies on the TAR contract with all of the documents a buyers signs, including: disclosures, a copy of the MLS listing, and even a copy of the tax information from Courthouse Retrieval system listed in the Exhibits and Addenda area of the contract.

I am concerned about this as it appears it could make these documents part of the contract when they are not part of the contract. Do you agree they should not be listed there and how would you suggest we approach that with the other firms? One of the brokers doing that said they are primarily doing it for compliance reasons internally, to make it easier to tract what documents the buyer has signed.

ANSWER: Agents should be very careful about what is listed as included in the contract. Disclosures can be a part of the contract without too many problems. The main issue that we can see is that the disclosure form might include information about an item that is not included in the sale (such as an appliance). By incorporating the disclosure as part of the contract, this could wind up including these items in the sale. In addition, we strongly recommend NOT including the MLS sheet or other information which may not have accurate information. By including these things in the contract, you could be opening yourself up to problems such as misleading advertising and/or square footage problems, etc.

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


2. HOT LINE: Resolution Period Is Blank?

QUESTION: In Section 8 D of the Form F9 Purchase and Sale Agreement, if the resolution period is left blank, is there a Tennessee law that states what the amount of days shall be (automatically)?

ANSWER: Tennessee does not have a law dictating that a Default time period would apply to the contract if it is not specifically stated within the contract itself. This is why it is so critical that all blanks in the TAR forms are completed. If you have a contract where this is omitted, we would recommend that the contract be amended to include this information. Otherwise, it would be up to a court to determine what a “reasonable period” would be.

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


3. HOT LINE: Multiple Offers on Short Sale Listing?

QUESTION: We have a short sale listing and have received a contract that has been accepted by the seller; however, the bank has not yet responded. In the meantime, we have received another contract on the property at a significantly higher amount. We need to know how to handle this situation. Can we present this offer to the lender as well?

ANSWER: An agent has a duty to submit all offers to their client, unless they are instructed in writing not to do so. It is completely up to the seller as to what, if any, offers are submitted to the bank. In addition, the bank generally instructs the seller as to how to handle offers and what they want to be submitted. Some banks only want one, some banks want all offers. In addition, the seller can have one contract, and MANY backups, especially if the bank wants all offers to be signed and presented to them.

There is another issue to bear in mind on why it is up to the seller to make a determination about what is disclosed to the bank. The seller is the one risking foreclosure. If the bank is notified about another offer, then it can derail a pending contract, increasing the likelihood of foreclosure. However, it could also be beneficial to the seller in that it lessens the amount that the seller may still owe the lender if it is a better offer or convince the bank to settle more quickly. Ultimately, that’s why it is up to the seller to make that disclosure.

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


4. Alert About the TAR Convention Hotel!

Hotel reservations MUST be made at the Meadowview Resort – site of the 2012 Convention – by August 20, one week away! After that date, our room block WILL be released, and another group using the hotel has already indicated that they will use any rooms not taken by that date!

To make your room reservation in the TAR block of rooms, call (423) 578-6550 and ask for the “TAR group rate”.

For more information on the Convention: http://tnrealtors.com/meetings-and-events/convention/


5. A Video You Should Watch!

David Knox, one of our featured speakers at the upcoming TAR Annual Convention in Kingsport, has created an engaging video just for TAR members — as a short preview of what members can expect at the Convention!

To watch it online, CLICK HERE.


6. TN Closing Costs Are Average for U.S.

Origination and title costs on a $200,000 mortgage averaged $3,754 nationwide, down 7.4 percent from 2011, based on Bankrate’s annual survey. Origination fees declined 1 percent; while title and closing costs shrank nearly 12 percent. For the third straight year, New York had the highest closing costs at $5,435, followed by Texas at $4,619 and Pennsylvania at $4,467; while Missouri, Kansas, and Colorado had the lowest closing costs at $3,006, $3,193 and $3,199, respectively.

The average closing cost on a $200,000 mortgage in Tennessee in 2012 is $3,747 (in line with the national average) — $1,587 for origination fees and $2,160 for title and closing costs.

Bankrate.com surveyed up to 10 lenders in each state in June 2012 and obtained online good faith estimates for a $200,000 mortgage to buy a single-family home with a 20 percent down payment in the state’s largest city. Costs include fees charged by lenders, as well as third-party fees for services such as appraisals and title insurance. The survey excludes taxes, property insurance, association fees, interest and other prepaid items.

To see results for the entire U.S., go to: http://www.bankrate.com/finance/mortgages/2012-closing-costs/closing-costs-by-state.aspx

[SOURCE: Bankrate.com]


7. Builder Confidence in the 55+ Housing Market Is Up

Builder confidence in the 55+ housing market for single-family homes showed improvement in the second quarter of 2012 compared to the same period a year ago, according to the National Association of Home Builders’ (NAHB) latest 55+ Housing Market Index (HMI) just released. The index more than doubled year over year from a level of 13 to 29, which is the highest second-quarter reading since the inception of the index in 2008. To read more: http://www.nahb.org/news_details.aspx?newsID=15472

[SOURCE: NAHB]


8. About Your Listing Presentation…

Last week REALTOR Melissa Krchnak posted an interesting short article to NAR’s YPN Lounge entitled “What Olympic Sport is Your Listing Presentation?”.

EXCERPT: “I obviously am not an expert in what anyone else’s listing presentations are like, I only know mine. Yet I heard someone talking about the Olympics recently, and with my market’s emphasis on the need for more inventory, it got me thinking. Is your listing presentation like watching cycling or gymnastics?

To read more, CLICK HERE.

[SOURCE: NAR]


9. Rates Inch Up Again to 3.59%

Last week, average interest on 30-year fixed mortgages according to Freddie Mac inched up again to 3.59 percent (with an average 0.6 point), after setting or matching record LOW rates for 13 of the previous 15 weeks!

And 15-year rates remained very low at 2.84 percent!

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

To see THDA rates and programs, go to: http://tn-tennesseehda.civicplus.com/index.aspx?NID=8


10. To Ask a Hot Line Question…

To ask a TAR Legal and Ethics Hot Line question, go to: http://tnrealtors.com/services-support/legal-ethics-hotline/