The 4-2-13 Newsletter of the Tennessee Association of REALTORS
Editor: Pug Scoville


1. Upcoming COURSES & EVENTS
2. HOT LINE: Who Holds the Earnest Money?
3. HOT LINE: Why Should a Firm Have an Agency Policy?
4. HOT LINE: Recommending Spouse’s Services?
5. Get Your LICENSE TO SELL!
6. Candidate Training Academy Scheduled
7. IN OTHER NEWS…
8. No TAR DIGEST Next Week
9. USEFUL LINKS


1. Upcoming COURSES & EVENTS

April 3: Tennessee’s 2013 Fair Housing Matters Conference (7 Hours CE) – Murfreesboro, TN. For more information or to register: http://www.tnfairhousingmatters.net

April 4-24: GRI 403, Working More Effectively With Buyers (8 Hours CE) – An E-Class Distance-learning course. For more information or to register: https://www.123signup.com/event?id=bzmcj


2. HOT LINE: Who Holds the Earnest Money?

QUESTION: My buyer put in a contract for a spec house, to be completed and sold to them within one month. They wrote an earnest money check payable to the builder’s real estate broker in an escrow account. The builder and his listing agent refused the earnest money, stating it MUST be made payable to the seller (e.g., builder). This builder was one we had not heard of before, so my buyer was concerned and asked to see the financial strength (or some proof to that nature) of the builder before putting their earnest money in a non-escrow account with him. The listing agent and her broker both decided my buyer was out of line to ask for that, so they told us to take our business elsewhere. Is this ethical and legal? I have always told my seller they must have the earnest money in an escrow account, or with the closing attorney at minimum.

ANSWER: Who holds the earnest money is a matter which is negotiable between the parties. It is not necessary for a real estate agent, attorney, etc. to hold the funds. The buyer or seller can hold the funds. It is not unusual for builders to ask to hold the funds. HOWEVER, as an agent who works with and represent buyers, you should always notify them of the dangers (which you addressed) in allowing the builder to hold the funds.

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


3. HOT LINE: Why Should a Firm Have an Agency Policy?

QUESTION: Why should a company have a written agency policy in place for its agents?

ANSWER: Every company SHOULD have a written agency policy in place. Having a clear policy in place, with all sales associates advised of it, will hopefully prevent any sales associate from exposing the firm, the managing broker, or the other sales associates to unnecessary liability!

A clear policy accomplishes several things. First, it clearly defines whether the company practices designated agency or regular agency. This is important because you cannot have part of the company practicing designated agency and part of the company practicing standard agency. This creates confusion AND could lead to an inadvertent and undisclosed dual agency or another legal conflict of interest! Also, Tenn. Code Ann. 62-13-406(a) states:

A licensee entering into a written agreement to represent any party in the buying, selling, exchanging, renting or leasing of real estate may be appointed as the designated and individual agent of this party by the licensee’s managing broker, to the exclusion of all other licensees employed by or affiliated with such managing broker. A managing broker providing services under the provisions of the Tennessee Real Estate Broker License Act of 1973 shall not be considered a dual agent if any individual licensee so appointed as designated agent in a transaction, by specific appointment or by written company policy, does not represent interests of any other party to the same transaction.

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


4. HOT LINE: Recommending Spouse’s Services?

QUESTION: My husband is a contractor. I would like to recommend his services to any clients and customers I encounter who need the type of work he does. He also has a network of other very ethical contractors who do good work as well that I would like to recommend, although I have no personal relationships with the others. Since he is my husband, and I am receiving no monetary referral fees from him nor his associates, do I need to document the fact he is my husband in writing when referring his services? I have made a point to make it known my relation to him verbally but felt something should be in writing, especially if he is chosen to do their work. If so, which form should I use? Will I need this for all of the contacts I recommend his work to?

ANSWER: YES, you must disclose any recommendations to your husband or your husband’s company, preferably in writing for your own protection. The Broker’s Act requires that an agent:

(A) Not engage in self-dealing nor act on behalf of licensee’s immediate family, or on behalf of any other individual, organization or business entity in which the licensee has a personal interest without prior disclosure of such interest and the timely written consent of all parties to the transaction.
(B) 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 than 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’s Legal & Ethics Hot Line Attorneys]


5. Get Your LICENSE TO SELL!

Do you have your License to Sell?

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TAR is holding a contest for every REALTOR who proudly displays his or her special REALTOR “Celebrate Homeownership!” License Plate! Your assignment for this mission (i.e., contest) is to show your REALTOR pride by submitting a photo of you and your Tennessee REALTOR license plate to TAR’s Facebook page.

Show off your License to Sell on our Facebook page and you could win up to $500! Encourage your friends to vote for you and have an even better chance to win! For more retails, go to: http://goo.gl/qXt1j


6. Candidate Training Academy Scheduled

The Tennessee Association of REALTORS Is Looking For A Few Good Candidates!

Have you ever considered running for political office? The National Association of REALTORS developed a Candidate Training Academy to show REALTORS and industry-friendly candidates how to run for elected office and we’re bringing it to TAR.

It’s intended to give candidates information on how to run successful campaigns and a give them a valuable head start in their political journeys. Trainers will help attendees assess whether or not they posses the basic traits to run for office and describe the elements necessary for developing a campaign, including how to approach fundraising, plan a budget and organize a Get-Out-The-Vote program.

REALTOR Candidate Training Academy
April 30, 2013
9:00 a.m. – 5:00 p.m.
$25 Program Fee
TAR Office in Nashville

Space is limited and individuals may apply at: http://tnrealtors.com/RealtorAcademy


7. IN OTHER NEWS…

E & O Law Passes! Thank you to the hundreds of REALTORS coming out last week to help advance the REALTOR Party legislative agenda! Our collective efforts were successful and the General Assembly unanimously passed legislation to allow the Tennessee Real Estate Commission to automatically suspend a licensee who fails to obtain, maintain or renew errors and omissions insurance. The legislation now goes to the Governor for his signature.

April is National Fair Housing Month! 2013 marks the 45th anniversary of the passage of the Fair Housing Act – the landmark legislation signed into law on April 11, 1968, that prohibits discrimination in the sale, rental and financing of housing based on race, color, national origin, religion, sex, family status or handicap. Every April, people across the country are encouraged to learn more about their rights and responsibilities under the act as a part of National Fair Housing Month. April 15-17 only, enroll in The CE Shop’s online Fair Housing course for HALF OFF! Enter Promo Code FH50 at checkout to receive 50% off BREAKING BARRIERS: FAIR HOUSING. Enroll at: http://tarnet.theceshop.com/

Remember the upcoming 2013 REALTOR Nationwide Open House, to be held on April 20 and 21. By participating in the largest-ever international open house campaign, you can bring value to home buyers and sellers around the world!

Instructor-Training Workshop Offered! The Williamson County Association of Realtors is pleased to announce that TREEF’s Learning-Centered Instructor Workshop will be held at the WCAR Office in the Cool Springs area on Monday and Tuesday, May 6 & 7. The class runs from 8:30AM – 5:00PM both days, offers 16 hours of TREC credit, and costs $245 (with lunch). The instructor is Steve Champion. For more information or to register, contact Karen at the Williamson County Association: 615-771-6845


8. No TAR DIGEST Next Week

Your Editor reports for jury duty next week, which is infinitely better than reporting in front of a jury!

Consequently, I will not be around to publish the TAR DIGEST, but the DIGEST will return with the 4-16-13 issue!


9. USEFUL LINKS

To access current and past TAR DIGESTS: http://www.tardigest.com

Follow TAR on Twitter at: http://twitter.com/tnaor

TAR’s LinkedIn page: http://www.linkedin.com/groups?gid=852077&trk=hb_side_g

TAR’s page on Facebook: http://www.facebook.com/pages/Nashville-TN/Tennessee-Association-of-RealtorsR/15041383689

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

For CE classroom courses around the state, go to: http://tnrealtors.com/education/realtor-courses/

For online CE courses, go to: http://tnrealtors.com/education/online-courses/

Tennessee Real Estate Commission: http://tn.gov/regboards/trec/

To check your CE credits on file with TREC, go to: http://verify.tn.gov