Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Here are details on an upcoming webinar from the Treasury Department:

Short Sale Workshop/Webinar 
This webinar is designed specifically for the real estate professional to discuss short sales, the Making Home Affordable (MHA) Program and available resources.

May 9, 2012
9:30AM – 11:30AM CST 
Presenter: Chris Dove, U.S. Department of the Treasury

Click HERE to register. Space is limited.
Conference Call Numbers: Provided upon registration.

Please be prepared to provide your name, phone number, email address and company name. If you have any questions prior to the call, please send an e-mail to MHA_Training@fanniemae.com.

Come prepared with your questions. There will be a question and answer session following the training. Questions not answered during the call can be directed to the MHA Training Team at MHA_Training@fanniemae.com.

Program guidance is available on HMPadmin.com.

And here are a few more Making Home Affordable resources:

Updated Request for Mortgage Assistance (RMA) Form
The RMA Form has been updated in light of the recent extension and expansion of MHA programs. The updated version is not required until June 1, 2012, but homeowners may begin to use the form today. View the updated RMA Form to familiarize yourself with the new format and information homeowners must provide when applying for foreclosure-prevention options under MHA. The Spanish version will be available soon.

Real Help. Real Answers. Right Now.
MHA’s public service advertising campaign has helped the program reach struggling homeowners across the nation, and more than a million have now received help through MHA programs. But our work is not done. With the extension of the program through 2013 and the expansion in program eligibility, there’s time to help more homeowners achieve sustainable mortgage relief. Watch this short video to learn more about our outreach efforts and visit our PSA Toolkit for ways you can help spread the word to homeowners in your community.

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Fannie Mae is offering a webinar THIS MONDAY, April 23 designed specifically for the real estate professional to discuss short sales, the Making Home Affordable (MHA) Program and available resources.

Here are the details direct from the Treasury Department:

Short Sale Workshop/Webinar
Monday, April 23, 2012 | 9:00AM – 11:30AM CST

In this information-packed session, we’ll explore just about everything you need to know about executing short sales in today’s marketplace. Hear directly from servicers about the most effective ways to get your short sale offer approved, navigate the process more smoothly, get help with difficult cases, and close the deal faster. Also hear from Treasury about Making Home Affordable’s HAFA program. Don’t miss this opportunity to get all of your questions answered. (This session is not open to homeowners.)

Come prepared with your questions. There will be a question and answer session following the training. Questions not answered during the call can be directed to the MHA Training Team at MHA_Training@fanniemae.com.

Presenter: Carol Lambert, U.S. Department of the Treasury

Click HERE to register.  Space is limited, please register today!

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Yesterday, in a five-page bulletin, the GSEs issued new guidelines for Fannie Mae- and Freddie Mac-backed loans. As of June 15, 2012, agents working with distressed homeowners should expect to receive a decision on the short sale offer within 30-60 days. Service providers must comply with the new time frames as described in the bulletin.

For more information about the initiation of the time frames, read the DSNews article “Fannie and Freddie Set Timeline Requirements for Short Sales.”

View other short-sale related posts from this blog.

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Image courtesy of Flickr user ishane

Every few days, a new request for mediation or arbitration is filed with AAR’s Professional Standards Department relating to a compensation offer in the MLS for a lease agreement.  REALTOR® A secures a tenant for REALTOR® B’s lease listing, thereby earning the compensation duly offered in the MLS. However, unlike a purchase contract wherein a title company issues commissions to the listing and selling sides of a transaction, the compensation for a lease agreement is paid directly by the listing brokerage who offered the rental for lease. But REALTOR® B does not pay REALTOR® A the promised compensation.

Often times the amount of compensation for a lease is $600 or less.  If REALTOR® A files for arbitration, in accordance with Article 17 of the National Association of REALTORS® Code of Ethics, REALTOR® A needs to deposit a $500 fee for filing. (REALTOR® B would also be required to deposit a $500 fee for the mandatory arbitration, and the prevailing party would receive a refund of the $500.) REALTOR® B is holding out on the payment to REALTOR® A, hoping that REALTOR® A is not willing or is unable to outlay an additional $500 to receive compensation of an equal or lesser amount.

Ethical Questions to Review:

• Is it ethical not to pay a fellow agent compensation REALTOR® B has agreed to pay through a cooperative agreement in the MLS?
• Is it viewed as unethical if the commission offered is under a certain amount, say $600 or $700?
• Is REALTOR® B entitled to keep the compensation owed to another and disregard the earning of the compensation as inconsequential?

Another question which comes to mind is: If REALTOR®B were in REALTOR®A’s shoes, how would he view the obligation of compensation?  Taken from the preamble to the Code of Ethics and Standards of Practice: “REALTORS® can take no safer guide than that which has been handed down through the centuries, embodied in the Golden Rule, ‘Whatsoever ye would that others should do to you, do ye even so them.’”

In conclusion, REALTORS® are obligated to do the right thing.

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

AAR’s Professional Standards Department responds to member calls regarding every aspect of a real estate transaction.  One topic that tops the charts is the question of commission and, specifically, the reduction of commission in a short sale transaction.  In her book Arizona Real Estate: A Professional’s Guide to Law and Practice, Michelle Lind, general counsel for AAR, offers insight into these types of commission questions:

“Assume the following facts: The property is listed in the MLS as a short sale subject to lender approval.  The buyer submits an offer through the buyer’s broker.  The listing broker submits the offer and and short sale package to

 the lender.  The lender responds that it will approve the short sale if the total commission is reduced by 2%.  Both buyer and seller demand that the brokers reduce their commission to allow the transaction to close escrow…

Question:  If the listing broker agrees to reduce their commission, must the buyer’s broker agree to split the reduction?

Answer:  No.  The buyer’s broker’s has no obligation to agree to split the reduction in commission.  The buyer’s broker is entitled to the cooperative compensation offered in the MLS at the time the broker produced the offer.”

Excerpt from Chapter 4: Broker Employment Agreements – Page 80 (Second Edition)

 Interested in self-help that you can access immediately when real estate questions such as this arise?  This must-have book is available in print and ebook formats. The ebook format can be downloaded to your smart phone, tablet, laptop, desktop and other readers. Buy it today!

For information when you need it, where ever you need it, consult what I commonly call “the book of knowledge” for the real estate professional. Don’t leave home without it!

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Photo courtesy of Flickr user Crashmaster007

This is part four in a four-part series.  See parts one (property management), two (REOs and short sales) and three (improper drafting of documents & advertising issues).

Here is an important risk management issue for brokers and managers: How do you handle agent-to-agent conflicts that arise? You do not want them going throughout the office unresolved.  I am sure you have all seen instances where an agent with an issue starts going around an office trying to garner support or sympathy for “their side” of the conflict.  In-fighting can destroy office morale when left unattended.

Sometimes the only solution is to ask one of the offending agents to leave, or both, but that is probably the worst case scenario.  A good risk management option for a brokerage would be to check your office policies and procedures and try to shore up areas of behavior issues before they begin.

AAR has received many complaints related to in-house referrals.  An agent claims the broker did not want to intercede between the agents disputing the referral or make a decision on the referral for them, and the agent starts seeking outside sources to help them decide what to do next.  Again, it would be good practice to look through your polices on referrals or establish a policy to include verbiage such as, “All referrals between agents must be in writing, acknowledged by both parties, and the dollar amount or percent clearly described.”  The broker or office manager then has a policy to use regarding the referral, thereby eliminating the need for a controversial decision that could be challenged.

One final risk reduction point for brokers and managers: Agents often call AAR with questions that should really be addressed by the agent’s broker or office manager.  When the agent is asked whether or not they have spoken to their broker or manager, the agent responds no.  When it is suggested that the agent contact their broker or office manager, all manner of excuses are offered relative to a broker or manager’s availability, managers not having the knowledge, the agent not understanding when or who to contact at the brokerage, etc.  Implementing communication policies regarding the chain of command in your offices is something that should be researched in every office.  For example, if an agent has a question, who do they go to first: a mentor, the office manager, the broker?  At what point should contact with the broker be made and what form does the contact take?

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Photo courtesy of Flickr user Frank3.0

This is part three in a four-part series. See parts one (property management) and two (REOs and short sales).

Improper Drafting of Documents. AAR’s Professional Standards Department is receiving a number of complaints about the improper drafting of forms, such as contracts, counteroffers and addenda.

Although not always a main cause of action, improper drafting can be discovered when a complaint is being reviewed. When reviewing forms, consider: Have the forms been properly filled out? Are there initials and/or signatures on all?  Have the documents been reviewed when returned for changes, additions or deletions?  Do you have a copy of all documents for the transaction?  One missing piece, lack of a signature acknowledgement or an altered document that you cannot defend can lead to a violation.

Recently, one complaint involved a REALTOR® drafting a lease purchase.  If the REALTOR® doesn’t understand the transaction, they certainly are not drafting the paperwork correctly to protect the parties they represent.  Which leads to a question for our broker/manager readers: Do you allow your agents to draft lease options or lease purchases?  Have you reviewed your in-house policies for specialties your agents may offer?  Do you have specific training requirements prior to your agents offering such services?

Advertising Complaints. Here are complaints we are seeing charged frequently under Article 12:

• An MLS picture of a property from the “area” not the actual property with no disclaimer identifying the photo as not the actual site but an area photo
• Agents making claims that they are #1 in a particular market place or area that are false or misleading
• A variety of internet issues such as lack of disclosure (not indicating a licensed REALTOR®, not including the office affiliation)

One issue that comes to mind was that of a community with a lake.  The photo indicated the property as a “lake front” offering when in fact, the property was located a good distance from any lake.

Stay tuned for the next installment of this month-long series. On Monday, November 28, we’ll touch on agent-to-agent conflicts and broker communication policies.

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Photo courtesy of Flickr user (and AAR member) Nick Bastian Tempe AZ

This is part two in a four-part series. See part one (property management).

Arizona is one of the hardest hit states for foreclosures and short sales, and this has led to increased complaints around these transactions. The public has complaints that offers are not being submitted. They have a lack of trust for REALTORS®. They feel REALTORS® are not communicating with them regarding their offers, counter offers or escrow.  They feel that they are contacted by their REALTOR® only when the REALTOR® needs something from them.

Here are some examples of complaints we’ve received:

• Agents accepting and communicating verbal offers: leaving the public feeling that they have a contract and then they find out that other offers have come in and the only way to REALLY obtain the property is through a bidding war (or they are told they have lost out entirely)
• Complaints from REALTORS® when co-broking: agents not communicating with them; a lack of trust in their fellow REALTOR® that offers have actually been submitted and/or are submitted on time; complaints about “inside” selling (in-office contracts that only get put together once their offer is submitted and often from the REALTOR® who purchases for themselves)

Good record keeping on behalf of the agent will assist in reducing risk if a complaint is filed against you.  Record keeping should include: keeping text messages; keeping email communications; and sending a follow-up email, if you have a phone discussion, which outlines the conversation.  Protect yourself with the ability to reproduce communication between you, the client and other REALTORS®.

Stay tuned for the next installment of this month-long series. On Friday, November 18, we’ll touch on the improper drafting of documents and advertising issues.

Posts by "Jan Steward" http://www.aaronline.com Jan Steward brings a wealth of experience to the Arizona Association of REALTORS® as the Risk Management Specialist. She is a former title company manager and escrow officer with paralegal training. As a REALTOR® and broker, Jan served the Northern Arizona Association of REALTORS® (NAAR) as board president, vice-president, director, MLS chair, delegate to NAR’s national convention and a member of the Professional Standards and Grievance Committees. Jan was honored as REALTOR® of the Year by NAAR. She also has served on AAR's Professional Standards Committee and a variety of ad hoc committees.

Photo courtesy of Flickr user Fousty

Market conditions have led to an unusual number of ethics complaints being filed at AAR.  By evaluating the complaints filed, we are able to extract data such as: What are the most frequently complained about issues?  What does staff hear from the public and agents as emerging trends? This is part one of a four-part series we’ll be running in November to share a few of our insights with you.

Property management has become an area for numerous complaints.  As the sales market tightened and potential sellers were unwilling or unable to compete with REOs and short sales, they became the newest group of landlords.  With increased demand from the public for property management services, new skills were required of agents who had not previously been involved in the rental market.

So what types of issues relate to property management complaints?

• Account issues; keeping accurate records for both the landlord and tenant
• Order of services, such as repairs; tracking the services for completion and assigning invoices to the correct properties
• Financial accountability; being able to provide itemized records for both landlords and tenants
• The Landlord/Tenant Act itself – knowing it inside and out; understanding the rights of both landlords and tenants
• E&O coverage at the brokerage for property management services

As a reminder, all offices with agents offering property management services should scrutinize their E&O policies and understand what their policies do or do not cover for property management.

A member of the public called AAR questioning how to file a complaint against a property manager whose rents were deposited into the agent’s account and not the landlord’s.  When he asked the agent for reimbursement, the agent said he had spent the funds and was unable to reimburse the client.

This is one example of how a REALTOR® can get into trouble with property management. Brokers/managers must provide oversight to insure that records are properly kept and the agent is providing the service their agreement authorizes.

Stay tuned for the next installment of this month-long series. Next Friday, November 11, we’ll touch on REO and short sale issues.