DR Legal News - Illinois REALTORS

September
2010
D.R. Legal News
The Illinois real estate managing broker’s trusted source for
current legal, management and housing market issues
in this issue
Short Sale Pulse P.7
Legal Case Studies P.9
Market Statistics P.12
Industry News P.14
Discipline Cases P.15
D.R. Legal News is a
quarterly online publication
of the Illinois Association
of REALTORS® sent by
e-mail to the Designated
REALTOR® (D.R.) in 9,000
member real estate offices
statewide.
IAR LEGAL
HOTLINE
Illinois Designated
REALTORS® get exclusive
access to the IAR Legal
Hotline, a member’s only
resource featuring
telephone or email legal
assistance/information.
> 9 a.m. to 4 p.m.
> Monday through Friday
> 800-952-0578
> [email protected]
Home Warranty Payments to Real Estate Brokers
The issue of compensation paid by home warranty companies to real estate brokers and agents has been a topic of discussion since the Office of General Counsel
for the U.S. Department of Housing and Urban Development issued an unofficial
staff interpretation letter on February 21, 2008. On June 18, 2010 an interpretive
rule was issued by the HUD Office of General Counsel interpreting Section 8 of
RESPA as it relates to payments from home warranty companies to real estate
brokers and agents. The effective date of that interpretive rule was June 25, 2010.
Read more >
Update on E-Contracts and E-Signatures. There have been some additional
questions raised recently regarding the use of e-real estate contracts and e-signatures in Illinois. The simple answer under Illinois law is that e-real estate contracts
and e-signatures are permissible and legal. However, (and this is a significant
however) the issue has been and continues to remain how do you prove that the
e-signatures are the signatures of those parties indicated and that the e-real estate
contract contains exactly the language agreed to by the parties when they signed
with an e-signature. Read more >
Short Sale Pulse. In the June Illinois Association of REALTORS® Broker
Sentiment Survey, we took the pulse of managing brokers related to short sales
and their expectations for the Illinois housing market for the second half of the
year. Most (58%) report the number of short sales have increased in their offices
compared to a year ago. Read more >
D. R . L e g a l N e w s | © I L L I N O I S A S S O C I AT I O N O F R E A LTO R S ®
Vi s i t u s a t w w w. i l l i n o i s r e a l t o r. o r g / D R l e g a l n e w s a n d s u b s c r i b e t o t h e b l o g w w w.IARbuzz.com.
Home Warranty Payments to
Real Estate Brokers
by Steve Bochenek, IAR Legal Counsel
T
he issue of compensation paid by home warranty companies (“HWCs”) to
real estate brokers and agents has been a topic of discussion since HUD’s
office of the General Counsel issued an unofficial staff interpretation letter
on February 21, 2008. On June 18, 2010 an interpretive rule was issued by
the Office of General Counsel for Housing and Urban Development (“HUD”)
interpreting Section 8 of RESPA as it relates to payments from HWCs to real estate brokers and
agents. The effective date of that interpretive rule was June 25, 2010. The notice of the interpretive rule also provided a 30-day comment period, which is ending as the article is being written.
In its discussion regarding the need for the interpretive rule HUD indicated that it had
received a number of questions regarding compensation paid by HWCs to real estate brokers and
agents in connection with the sale of home warranties. These questions particularly focused on
the legality of providing this compensation on a per transaction basis and the scope of services
that needed to be provided by real estate brokers and agents in order to be compensated by an
HWC.
The interpretive rule clearly states that RESPA does not prohibit the referral of business by a
real estate broker or agent to an HWC. However, Section 8 of RESPA does prohibit the payment
by an HWC to the real estate broker or agent in return for the referral of business. The question
then becomes whether the payment from an HWC is for a referral or whether the payment is for
services actually being provided by the real estate broker or agent in return for the compensation
from the HWC.
Near the conclusion of the interpretive rule it is stated that HUD interprets Section 8 of
RESPA as it applies to compensation paid by HWCs to real estate brokers and agents as follows:
“(1)A payment by an HWC for marketing services performed by real estate brokers or
agents on behalf of the HWC that are directed to particular homebuyers or sellers is an illegal kickback or referral under Section 8;
(2) Depending upon the facts of a particular case, an HWC may compensate a real estate
broker or agent for services when those services are actual, necessary and distinct from the
primary services provided by the real estate broker or agent, and when those additional services are not nominal and are not services for which there is a duplicative charge; and
(3) The amount of compensation from the HWC that is permitted under Section 8 for such
additional services must be reasonably related to the value of those services and not include
compensation for referrals of business.”
The bottom line is
that HUD is interpreting Section 8 of
RESPA to prohibit
any payment by a
home warranty
company to a real
estate broker or
agent for performing
marketing services
to particular homebuyers or sellers.
The interpretive rule spends significant time discussing the payment of fees by an HWC for
marketing by a real estate broker or agent. The bottom line, as indicated above, is that HUD is
interpreting Section 8 of RESPA to prohibit any payment by an HWC to a real estate broker or
agent for performing marketing services to particular homebuyers or sellers. The interpretive
rule goes on to provide that there is nothing wrong under RESPA with a real estate broker or
agent marketing a home warranty company or the home warranty to a particular buyer or seller.
The issue that HUD has is when an HWC pays compensation to the real estate broker or agent
for such activities.
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taking of an application is not sufficient
work to justify a fee under RESPA.”
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HUD has taken the position that although
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The bottom line is that under this
interpretive rule HUD appears to be taking the position that the payment by an
HWC to a real estate broker or agent
for providing marketing services on a
numbers of the items to be covered,
Other indicators that are of concern to
HUD are marketing agreements that indi- documenting the condition of the covered transaction basis is a prohibited refercate that the services are performed on an items by taking pictures and reporting to ral fee. Further, HUD is indicating that
exclusive basis for one HWC company or the HWC regarding inspections...” HUD compensation can be paid by an HWC
to a real estate broker or agent but it has
also indicates in this interpretive rule
if payments from the HWC are adjusted
to be for compensable services that are
that there are other factors that will be
based upon the number of transactions
“actual, necessary and distinct from the
considered in connection with the deterreferred. Also, HUD indicates specifiprimary services provided by the real
mination as to whether the services are
cally that “sales pitches” about the benestate broker or agent” which services are
compensable. These other factors would
efits of a particular HWC product or the
not nominal and which fees are not dupliinclude whether the services to be prodistributing of promotional information
cative of those already being charged by
of a particular HWC at an open house are vided by the broker or real estate agent
the real estate broker or agent. In addition
to the HWC are specified in a contract
considered to be referrals and not comHUD is taking the position that the mere
between the two, that the services are
pensable services.
actually performed and not duplicative of taking of an application is not sufficient
In a footnote to the interpretive
services usually performed by the broker to be paid compensation by an HWC.
rule HUD indicates that “compensable
Services beyond the taking of an applicaor agent, whether the real estate broker
services are services that are actual,
tion will be required to be performed by
or agent is the legal agent of the HWC
necessary and distinct from the primary
the broker or its agents. It will also be
and the HWC assumes responsibility
services provided by the real estate brobeneficial if there is an agreement or conker or agent, that are not nominal, and for for their actions and that the compensation received by the real estate broker or tract in place between the HWC and the
which duplicative fees are not charged.”
real estate broker or agent detailing what
agent is disclosed to the consumer.
This footnote indicates three particular
services are to be performed and that that
The final element to be considered
elements that must be met, according to
HUD, to make the services compensable. by HUD in assessing whether compensa- broker or agent is acting as a legal agent
tion from the HWC to the real estate bro- of the HWC. Lastly, the compensation
Those elements are 1) actual, necessary
and distinct services, 2) services that are ker or agent is permissible under Section must be reasonable in terms of the ser8 of RESPA is whether the compensation vices that are provided. n
not nominal, and 3) services for which
is reasonable. This means that HUD will
duplicative fees are not being charged.
review and determine whether the comExamples of compensable services propensation paid is reasonably related to
vided in the interpretive rule are “...conthe value of the services performed by
ducting actual inspections of the items
to be covered by the warranty to identify the real estate broker or agent. The interpretive rule goes on to state that “. . . for
pre-existing conditions that could affect
home warranty coverage, recording serial example, HUD has stated that the mere
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Update on E-Contracts and E-Signatures
There have been some additional questions raised recently regarding the use of
e-real estate contracts and e-signatures in Illinois. The most recent article published by the Illinois Association of REALTORS® regarding this matter appeared
in the September, 2009 issue of D.R. Exclusive. Please review that article for a
more detailed discussion of e-real estate contracts and e-signatures in Illinois.
The simple answer under Illinois law
is that e-real estate contracts and
e-signatures are permissible and legal.
However, (and this is a significant however) the issue has been and continues
to remain how do you prove that the
e-signatures are the signatures of those
parties indicated and that the e-real
estate contract contains exactly the language agreed to by the parties when they
signed with an e-signature. Obviously,
this is not an issue unless one of the
parties to the contract objects that the
e-signature is not their signature or that
the e-real estate contract has been modified since their e-signature was affixed
to the e-real estate contract.
So what are your options if you
want to use an e-real estate contract and
e-signatures? Your first option would
be to simply explain to the parties and
ascertain if they are willing to accept
that the e-real estate contract and e-signatures will be valid unless somebody
objects to the signatures or contract. If
such an objection is received it may
be difficult to prove the validity of the
e-signatures or the content of an e-real
estate contract as it existed at the time of
those e-signatures. Your second option
would be to follow the procedures
provided for under Illinois law for the
establishment of a “secure electronic
signature” and a “secure electronic
record.” This involves the process of
using a digital signature or e-signature
using an asymmetric algorithm certified
by the Secretary of State as a qualified
security procedure. However, this pro-
cess seems to present hurdles or roadblocks which are difficult to overcome in
the context of the transaction. The third
option is for the parties to the transaction
to agree to a qualified security procedure
in advance of the signing of an e-real
estate contract. This qualified security
procedure must be commercially reasonable under the circumstances, applied in
a trustworthy manner and be reasonably
and in good faith relied upon by the
party wanting to enforce the secure electronic record (the e-real estate contract).
There is one additional item of
which you need to be aware if you
are using e-contracts or e-disclosures.
Federal law contains a “Consumer
Protection Provision” that provides that
electronic documents are not valid if the
consumer has not consented to receive
the electronic versions of documents that
he or she would otherwise be entitled to
receive in a paper format. An example
might be a residential real property disclosure form. The Consumer Consent
Provision is meant as a safety measure
for those consumers who may not be
electronically adept or who may simply
choose to receive these required disclosures in writing. Thus, the Consumer
Consent Provision serves to ensure that
in the event that a consumer has not
consented to receive required documents electronically they cannot be held
responsible for documents only received
electronically.
The Consumer Consent Provision
only applies to rights otherwise established by law. Thus, if a purchaser is
entitled to a
by Steve Bochenek,
written disIAR Legal Counsel
closure, they
have a right to receive that disclosure in
a non-electronic format, and they may
not be held responsible for receipt if
they have not consented to receive the
document or disclosure in an electronic
format. However, if there is no underlying right to a writing, that is that the law
requires notice but not notice in writing,
then the Consumer Consent Provision
does not apply.
The bottom line is that if you intend
to use e-disclosures in lieu of a statutorily required written disclosure you
should obtain consent in writing from
the consumer prior to making those
e-disclosures. As indicated above,
one example might be a seller disclosure form under the Residential Real
Property Disclosure Act. Another
example would be a dual agency disclosure form required under Article
15 of the Real Estate License Act of
2000. You can certainly include in
an e-real estate contract, or any real
estate contract, that the parties agree to
receive notices by e-mail or other electronic means. However that consent
needs to be given prior to the time the
e-disclosures are made. Also, by only
obtaining consent in the e-real estate
contract the consumer is not given the
opportunity to reject e-disclosures in a
written document. n
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Illinois Bans Private Transfer Fee Covenants,
and Other New Laws of Interest
A series of bills affecting real
•
Senate Bill 3180. The Common Interest Community
estate were signed into law
Association Act regulates non-condominium homeowner
over the summer, including
associations and includes an initiative allowing persons who
the IAR-initiated Transfer
enter the military service during the term of their residential
Fee Covenant Act (Senate Bill 3747), which bans private trans-
lease, or soldiers who are deployed or transferred, to break
fer fee covenants that would entitle the original property develop-
their lease without penalty (similar to the federal Service
ers to receive transfer fees from all future sales of the property.
Members Civil Relief Act). Effective July 29, 2010.
The law is effective Jan. 1, 2011. Other new laws include:
•
House Bill 6038. Extends the Illinois Affordable Housing
Tax Credit through 2016. The program has been used suc-
to require that foreclosures and short sales be taken into
cessfully by IHDA, local governments and non-profit housing
account in reviewing and correcting property tax assess-
groups. Effective July 26, 2010.
ments. Effective July 16, 2010.
•
•
Senate Bill 3334. Amends the Illinois Property Tax Code
•
House Bill 5409 - Requires title insurance companies
Senate Bill 3739. The Save Our Neighborhoods Act of
to provide closing protection coverage for their registered
2010 creates two new programs: a foreclosure prevention
title agents to protect buyers and sellers against acts and
program and an abandoned housing funding program within
omissions of those agents. IAR successfully fought to block
the Illinois Housing Development Authority (IHDA). It also
a state mandated fee on consumers for that protection.
extends the deadline to July 1, 2013 for an existing program
Effective January 1, 2011.
that pauses the foreclosure process so homeowners can
receive counseling. Effective October 1, 2010.
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Illinois Ranks Among Top-5 States for Broker Involvement
Sign up to make Illinois #1...and show your leadership on issues for your agents.
by Neil Malone, IAR Local Governmental Affairs Director
Be the first to know about legislative issues that affect your real estate business and your agents’
livelihoods by making one simple move. Sign up for the Broker Involvement Program of the
National Association of REALTORS® so we can make the REALTOR® voice that much louder
and stronger in Congress and at the Illinois State Capitol.
With the upcoming elections we anticipate big changes in the next legislative session and
important calls for action. By signing up for the Broker Involvement Program you show your
agents you have the pulse of issues that affect their bottom line. n
1. Sign up at www.realtor
actioncenter.com/
realtors/brokers/
2. NAR staff will contact
you to verify your information and obtain your
company logo.
3. When a federal broker
Call for Action is issued,
Join these Illinois Brokers
NAR will generate a
Hundreds of Illinois brokers have signed up and we rank among the top 5 states for
personalized e-mail to
participation in the program. Help us reach #1 by the end of the year!
your agents using your
List provided by the National Association of REALTORS® of brokers newly enrolled from May 21 to July 26.
logo and branding. The
The June D.R. Legal News published brokers enrolled through May 21. See the whole list online at
e-mail will be available
www.realtoractioncenter.com/realtors/brokers/states/brokers-results.html?state=IL
for the broker to review
Kallister Realty, Peoria, John McDonald
@Properties, Evanston, Peter Moulton
or decline prior to it being
Keeley Real Estate, Fairbury, Joe Keeley
1st Alliance Real Estate, O’Fallon, Tom James
sent. NAR always gives
Keller Williams Premier Realty, Peoria, Jodi Lemkemann
Adams Properties Services, Belleville, Karen Schwoebel
Lois Bellamy Realty, Homewood, Lois Bellamy
Adams Realty & Auction LLC, Belleville, Adam Jokisch
enrolled brokers the
LW Reedy Real Estate, Elmhurst, Karen Cookingham
Adonai Realty Investment Group, Chicago, Geneva Reed
choice to participate in a
Lyle Campbell & SonDecatur, Bruce Campbell
Allen & Associates, Pekin, Gary Allen
MQB Corp. Real Estate, Joliet, Michael Bily
America’s Choice Real Estate, Inc., Spring Grove, Janice Voegtle
broker Call for Action.
Ameristar Real Estate, Columbia, Ryan Patton
Antar Realty LLC, Naperville, Abraham Antar
Area One REALTORS®, Decatur, Rodger Coventry
Assist2Sell Buyers & Sellers, O’Fallon, Pam Dammerman
Bale Realty, Wilmington, Henry Bale
Battoe Realty, Inc., Swansea, Ken Battoe
Benchmark Real Estate Services, Roseville, Ron Wright
Blade Realty Group, Inc., Matteson, Lydel Blade
Brinkoetter & Associates, Decatur, Carla Brinkoetter
Century 21 Elsner Realty, Sycamore, Susan Elsner
Century 21 Elsner Realty, DeKalb, Dawn Baker
Century 21 Marino, Morton Grove Nicholas, Marino
Charles Rutenberg Realty, Naperville, KR “Ray” Zabielski
CMJP Properties, Columbia, Craig Hiser
Coldwell Banker Allen, Centralia, Suzanne Whittenberg
Coldwell Banker Classic Real Estate, Mattoon, Greg Staton
Coldwell Banker Devonshire Realty, Pekin, Kim Watson
Coldwell Banker Devonshire Realty, Decatur, Cheryl Friend
Coldwell Banker Heart of America Realtors Ltd., Bloomington, Rick Seals
Coldwell Banker Honig-Bell, Joliet, Joe Reposh
Coldwell Banker Primus, McHenry, Susan Miller
Coldwell Banker Primus, Wonder Lake, SueMiller
Coldwell Banker Residential Brokerage, LaGrange, Rose Rachford
Coldwell Banker Residential Brokerage, St. Charles, Michael Parent
Coldwell Banker Residential Brokerage, Highland Park, Steve Kolko
Crowne Realty LLC, Bloomington, Daniel Carcasson
D’Aprile Realty, Inc., Chicago, Jayme Thompson
Dreammakers Realty & Property, Oak Lawn, Teresa Stephenson
Elite Group Realty & Investments Inc., Chicago, Walter Son
Equity Fifty-Five, Breese, Chad Sellers
Executive Realty Group, Bloomingdale, Aleksandra de Leon
EXIT Realty Consultants, Belleville, Constance, Stellhorn-Schanter
Glenda Williamson Realty, Decatur, Glenda Williamson
Golden Crest Realty, Wheaton, David Frazza
Golden Homes Real Estate, Inc., Berwyn, Francisco Quintero
GRD Realty Inc., Broadview, Gerald David
Hilldale Properties Inc., Schaumburg, Grazia Cortes
Home Sweet Home Realty, Clinton, Denise Torbert
In Realty, Chicago, Maryann Dybala
Jelani Realty, Advisors, Chicago, Dorian Johnson
Netasha Scarpiniti, Broker, Oak Brook Netasha
Scarpiniti
Network Commercial Real Estate, LLC, Tinley Park, Tammy Spilis
New Directions Realty Cener Inc., New Lenox, June Graffy
Paragon Real Estate & Development Forest Park, Joann Martinez
Preferred Appraisal, Inc., Northbrook, Scott Waxman
Prestige Properties Real Estate Pros, Inc., Dolton, Melanie Sharpe
Prestige Realty Inc., Northbrook, Anatoliy Revenko
Priority Plus Realty, South Holland, Robin Butler
Prospect Equities, Orland Park, Shirley Proser
Prudential Rubloff Properties, Glenview, Geri Barborek
Prudential Starck REALTORS®, Mount Prospect, Donna Plank
RE/MAX 1st Service, Homer Glen, Katherine O’Radnik
RE/MAX Advantage Realty, Antioch, Mike Culat
RE/MAX Choice, Bloomington, Daniel Slagell
RE/MAX of Barrington, Barrington, Dragana Rajic
RE/MAX Preferred Partners, Edwardsville, Susan Landing
RE/MAX Showcase, Lake Forest, Robyn, Sorenson
RE/MAX South Suburban, Flossmoor, TonyMitidiero
RE/MAX Suburban, Glen Ellyn, Ralph Binetti
RE/MAX Unlimited, Peoria, Barb Smith
RealEstateAuctions.com, Oak Brook, Joanna Buniak
Realty 123 Inc., Chicago, Laura Rodriguez
Realty Executives, Aurora, H. Sue Wiskowski-Fair
Realty Professionals Group, Chicago, Albert Cossyleon
Richmond Partners, Flossmoor, Larson Richmond
Rick Hiton and Associates, Northbrook, Rick Hiton
S. Gardner Realty, South Holland, Shaunta Gardner
Signature Real Estate Professionals, Dekalb, Carrie Ottum
Southtowne Realty, Inc. Moline, Joann Acuff
Speckman Realty Inc., Real Living, Kankakee, Cindy Beasley
Stan Sieron & Company, Belleville, Stan Sieron
Stork & Associates, Bolingbrook, Linda Stork
Superior Real Estate Services, Blue Island, Alfonso Cortes
Tialdo Realty, Belleville, Ron Tialdo
Torri Peterson, Broker, Frankfort, Torri Peterson
Transequity, Orland Park, David Vaughn
WRC, Inc. REALTORS®, Washington, Mark Helmuth
ZipRealty, Inc. Park Ridge, Linda Luna
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Short Sale Pulse
In the June Illinois Association of REALTORS® Broker Sentiment Survey, we took
the pulse of managing brokers related to short sales and their expectations for
the Illinois housing market for the second half of the year.
Has the number of short sales changed
for your office compared to a year ago?
More short sales
Fewer short sales
About the same
No short sales
58%
6%
23%
13%
Have you seen the short sale process improve
since the Home Affordable Foreclosure
Alternatives program took effect April 5?
No
Yes
N/A
76%
10%
14%
Home Affordable
Foreclosure
Alternatives
(HAFA)
http://makinghomeaffordable.gov/hafa.html
This federal program is
aimed at streamlining the
short sale and deed-in-lieu
of foreclosure process for
homeowners who have
been unsuccessful in obtaining a loan modification.
•
“Any improvement in the short sales process has been spotty depending on the lender we’re
working with and the quality of the person at the other end of the phone.”
•
“Yes (there’s been improvement), as in the turn-around time for answers; no as in the banks’
willingness to negotiate on selling the home.”
and financial incentives to
•
“Some banks are using the Equator.com system which helps with more accountability.”
services to expedite these
•
“Still dealing with sellers’ agents who don’t know what they are doing and do not
follow up.”
Freddie Mac both have their
•
“Only (see improvement) if the listing agent is experienced in short sales and there are good
attorneys on both sides.”
•
“Each company still doing things differently.”
https://www.efanniemae.
•
“Most short sales are still too time-consuming and frustrating for buyers due to inadequate
responses from banks.” n
com/sf/servicing/hafa/
HAFA provides standard
documentation, timeframes
both borrowers and loan
sales. Fannie Mae and
own, similar HAFA guidelines. Learn more:
• Fannie Mae guidelines
• Freddie Mac guidelines
http://www.freddiemac.
Find IAR Short Sale resources at www.illinoisrealtor.org/shortsales
com/singlefamily/service/
hafa.html
Broker Expectations through Year End
•
“If the interest rates remain low, we should see another upward tick in the market.”
•
“Banks MUST ease up on their processing and underwriting guidelines.”
•
“With our economy so rocky, no matter what Washington tells people, the country is
worried about jobs and job security.”
•
“With all the shadow market and foreclosures that are now being listed in the marketplace, we will be flooded for the next two to three years with inventory.”
•
“Today I am working harder to keep sellers informed regarding any activities. A new
number to watch is BOM (back on market) properties. Our inventory is increasing and
there are more rental calls today than ever before.”
•
“Here in Illinois we rarely hear the words economic development. Government is simply looking for ways to increase taxes without regard to any increased productivity.
This has had a serious impact on the total economy.”
•
“Not much change in real estate unless the local job market changes.
People need jobs.”
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The IAR Broker Sentiment
Survey is conducted by
the Illinois Association of
REALTORS® to gain insight into
the housing markets now and
in the future. Respondents are
managing brokers in real estate
offices throughout the state.
This survey is an indicator of
the housing market based on
their responses to a survey
conducted June 2010.
> < > <
Trends and Broker Strategies
We asked Inman News columnist and real estate coach Bernice Ross to share
some recent trends she’s observed for brokers. Ross is a featured speaker at the
upcoming IAR Convention Sept. 29 – Oct. 1 in St. Charles on the topic of “You
Snooze, You Lose: Trends to Take Your Business to the Top in 2011.”
Q: What are some of the coaching conversations you’re having
with brokers today? Ross: The median age of agents is 54 and for broker-owners and
managers it’s higher. Many agents and brokers are looking at whether they will be able to sell
their businesses when they are ready to retire. The first question you must ask is what are you
doing to create a saleable business? What is your plan to attract the customers of tomorrow?
If you are a broker/owner, are you prepared to show Gen X and Gen Y agents how to build
a profitable business that they can also sell in the future? If you can show them how to build a
profitable business, they will probably be relatively easy to recruit.
Regardless of whether you are a broker-owner or agent, in order to have a saleable business, you
need a saleable brand that does not use your name. “Bernice Ross Realty” is not a saleable brand.
If you have branded your business using your name and you have huge name recognition
in a particular market, you don’t need to get rid of your current branding. Instead, add to it with
sub-brands such as “Lincoln Park Homes” or “Michigan Avenue Luxury High Rises.” These
brands are saleable and improve your web placement as well.
Q: Share an effective social media tactic for agents.
Ross: “I love my area” campaigns can work very well with Facebook. Dedicate your Facebook
page to your area with information about local events, historical homes, and other pertinent community information. When you meet someone at an open house, invite your guest to “Join our
Facebook fan page for this area to find out what is great about living here.”
Q: What’s a good coaching strategy for the broker-owner?
Ross: Many broker-owners spend a lot of time working with their bottom quartile. A better
approach is to focus the bulk of your energy on you top producers and what is known as the
“profitable middle.”
Research from the National Association of REALTORS® shows that 7 percent of the agents
are doing 93 percent of the business. If you work with your top people, you will see a big
increase in production. While you still need to provide training to everyone, your time is best
spent helping those who are producing.
Q: Share some ways to be successful in a down market.
Ross: I don’t know if it will be 2014, but a seller’s market is coming and it’s not that far out.
There are more Gen Ys (born 1977-1994) than there are Baby Boomers. Gen Y is now at their
peak time to purchase their first home. The difference between the amount of new housing needed to meet these demands and the amount of housing being created is huge; we already have a
shortage coming based upon the population trends.
• The really good agents have their best years in the lean markets. They have the negotiation skills
to attract clients. Negotiation training is one of the most critical things an agent or broker-owner
can do to improve their business.
• If I was starting from scratch in this business, I would tap into lead generation companies and pay
for leads. I would also call on owners of expired listings, become active on Meetup.com, and
build my presence on social media.
• A really critical component is to niche your business in two to three areas and become the
expert in these areas. For example, if you niche your business for downtown loft buyers,
you may want to expand that niche to suburban properties where these former loft dwellers
go when they have their first baby. When you go hyperlocal you become a specialist in a
very narrow part of the market and it’s easier, less costly, and much more effective to brand
yourself in a smaller area. n
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Bernice Ross is a Master Certified
Coach with over 30 years of real
estate sales experience. As CEO
of RealEstateCoach.com, Bernice
currently heads up the company’s
10-person coaching team while
also serving as a coach and a consultant to the top firms in the real
estate industry. Past consulting clients include Coldwell Banker, EXIT,
GMAC, Keller Williams, Prudential,
Realty Executives, RE/MAX, and
HomeGain.
Catch
Bernice Ross
live in her session
for the IAR Convention
Sept. 29–Oct. 1 in
St. Charles:
“You Snooze, You Lose:
Trends to Take Your
Business to the Top
in 2011”
www.illinoisrealtor.org/
convention
> < > <
Legal Case Studies
“Sale Contract” used by Buyer
and Seller was found to be an
“option” contract by the Court and
a $100,000 down payment was
determined to be a nonrefundable
option payment. Additionally, the
Court held that an option contract is not
subject to the Residential Real Property
Disclosure Act. The Terraces of Sunset
Park v. Chamberlin, Ill.App.Ct. 2nd
Dist. No. 2-09-0269 (April 28, 2010).
In September 2006, Plaintiffs entered
into an agreement with the Defendants
to purchase property in Highland Park
for $1,750,000. The written agreement stated that the parties desired “to
memorialize their basic agreement on
the sale and purchase of the property to
be supplemented by preparation of additional documents to supplement this sale
contract.” Under this agreement, the
Buyers were to pay $50,000 when the
agreement was signed and an additional
$50,000 on May 1, 2007 as a “down
payment.” The agreement provided that
if the Plaintiff failed to make the May
2007 installment, the initial $50,000
would be forfeited and the contract
would be null and void. The agreement
stated that once the installment payments were made, they were considered
to be “non-refundable” but they were to
be credited against the purchase price.
The agreement further provided that if
the Buyers failed to close on August 1,
2007, the down payment would be forfeited and the agreement would be null
and void. The Buyers also provided a
preprinted Multi-Board Residential Real
Estate Contract 4.0 which the Sellers
accepted. It included a purchase price
of $1,750,000 and a closing date of
August 1, 2007. The balance of the pur-
chase price adjusted by prorations was
due at closing, by wire transfer, certified
check, or cashier’s check. However, the
Buyers never signed this contract even
though they provided the form. The
Buyers made scheduled payments totaling $100,000 but then failed to close on
the sale. The Buyers then took the position that because they had never signed
the Real Estate Contract, no contract
existed and they wanted a refund of the
$100,000. The Buyers referred to the
$100,000 as the “earnest money deposit.” As an alternative theory, the Buyers
declared that they terminated the contract because the Sellers never furnished
the Illinois Residential Real Property
Disclosure Report as required by law.
When the Sellers refused to return
the deposits, the Buyers sued. The trial
court determined that the September 8,
2006 agreement was “unambiguous” and
was “a fully integrated and enforceable
agreement granting an option to purchase the subject property.” (Emphasis
added). It was not a sale contract. The
Court also found that the agreement
was unambiguous, that the two $50,000
payments were non-refundable and
that the Sellers were entitled to retain
the $100,000. On appeal, the Buyers
argued that the agreement was not an
enforceable contract for the sale of property. The Appellate Court agreed with
the Buyers on that point, however, the
Appellate Court ruled in favor of the
Sellers. The Appellate Court ruled that
while the circumstances did not amount
to an enforceable real estate sale contract, it was a valid option contract. The
Court recited that an option contract is
one in which a party (the Seller), based
upon consideration given to him by the
optionee (the Buyers), binds himself to
perform a certain act at the sole power
and discretion of the optionee to accept
upon terms specified at which time it is
converted from a bilateral to a unilateral
contract and cannot be withdrawn by
the optionor (seller) during the option
period. The Court stated that the during the option period, the owner does
not then actually sell the property, but
instead sells the right or privilege to
buy the property at the option price
upon the decision of the Buyers to
exercise the option that the Seller has
granted. According to the Court, an
option contract has two elements: (1)
an offer to do something or to forbear,
which does not become a contract until
accepted; and (2) an agreement to leave
the offer open for a specified time. The
Court also cited the rule that an option
contract must be supported by sufficient
consideration; if it is not, it is merely an
offer that may be withdrawn at any time
prior to a tender of the compliance with
the contract.
The Court found that the agreement
signed by the parties was, in substance,
actually an option agreement rather
than a “sale contract.” The Sellers had
signed the pre-printed “Multi-Board
Residential Real Estate Contract 4.0,”
but the Buyers never did sign the real
estate contract. Therefore there was
no enforceable real estate contract,
however, what the parties had was an
agreement that the Sellers would not sell
the property to any other person except
the Plaintiffs and that the option for the
Buyers to buy was supported by the
consideration of the Buyer’s payment
of $50,000 in September 2006 and then
paying a second installment of $50,000
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to extend the option to August 1, 2007
(the purported closing date). At that point,
the Buyers were not required to buy the
real property but had the “right” to buy
it pursuant to the option agreement and
under the terms of the real estate contract
at the agreed upon price of $1,750,000.
The Sellers were obligated for that specified period to keep the option open since
they had been paid $100,000; however,
the Sellers, since the contract was never
signed by the Buyers, could not require the
Buyers to take title to the property.
Despite the fact that none of the
agreements referred to the transaction
as an “option,” the circumstances and
the substance of the agreements were
construed by the Court to constitute an
option rather than an enforceable sale
contract. The agreement between the
parties was unambiguous in that once
the two $50,000 installments were paid
they were non-refundable. The Buyers
then argued that because the Sellers did
not provide a Residential Real Property
Disclosure Report, they could terminate
the option and receive a refund of their
earnest money. The Appellate Court dis-
agreed and stated that the Residential Real
Property Disclosure Act only applies to
transactions where there is an actual transfer of an interest in real property. Here,
because there was no transfer of an interest
in real property, but merely an option was
granted, the Real Property Disclosure Act
did not apply, and therefore, the Buyers
could not rescind the contract under the
provisions of the Act. The Buyers argued
that under the Act, an option is not specifically included in the list of exempted items
from the Act. The Court pointed out that
this argument missed the point because the
option contract does not involve a transfer of any interest in real property and is
therefore not subject to the Act in the first
place, and therefore need not be exempted
from it.
Taxpayer may not recover taxes he
voluntarily paid . . . [T]his true even
if the taxing body lacks the authority to impose the tax in question.
Sorce v. Armstrong, 2d.Dist No. 2-09-0478
(April 26, 2010). In this case the Plaintiffs
who had paid real property taxes on the
residence discovered that the Kane County
License Law Transition Question
Q: Since all licensees will be brokers soon could they just hang their
licenses in their homes?
A: After April 30, 2012, they could only do this if they are managing broker licensees
practicing as sole proprietors. In short, there must be a managing broker licensee for
every sponsoring brokerage “company” or sole proprietorship after April 30, 2012.
Learn more about changes to the Illinois Real Estate License Act of 2000 at IAR’s site dedicated
to the topic, www.IARlicenselaw.org. In Illinois no new salesperson licenses will be issued after
April 30, 2011 and the salesperson category disappears altogether in 2012. Licensees have from
May 1, 2011 through April 30, 2012 to make the transition from “salesperson” to “broker” license
or “broker” to “managing broker.”
Check out the IAR Legal Webinar Series,
www.illinoisrealtor.org/legal/webinars
Supervisor of Assessments had erroneous
measurements on the size of improvements
(namely homes) on certain residential lots.
These erroneous measurements inflated the
amount of real property taxes assessed and
paid by the homeowners on the property.
Evidence showed that the measurement
mistakes had been in the tax assessment
for the last 10 years. The Appellate Court
ruled, however, that the homeowners were
not entitled to a refund of the taxes. The
Court held that an error in calculation of
taxes is not an “overpayment of taxes”
thus their claims for refund were barred by
the statute of limitations. Additionally, the
Court determined that the taxes have been
voluntarily paid and this barred a refund.
Landlord’s right to a lien on personal property to pay unpaid rent
was superior to bank’s secured
interest in the same property of tenant where the bank failed to perfect
its lien. Southwest Bank of St. Louis v.
Poulokefalos, 2010 Ill.App.LEXIS 547
(1st Dist. 2010). Tenant abandoned a lease
on commercial premises and defaulted on
a $1,000,000 bank loan which was secured
by a commercial security agreement.
When the tenant vacated the property, they
left behind plastic extruding machines and
three silos that were bolted to the floors,
ceilings, and duct work. Under Illinois
law, the landlord filed a complaint and a
distress warrant. The distress warrant is
a procedure that allows a landlord to keep
tenant’s personal property and trade fixtures for payment of past due rent. This
is commonly referred to as a “landlord’s
lien.” The bank that had loaned the money
to the tenant filed an action to recover the
equipment that the landlord had seized.
The bank had filed a UCC Financing
Statement and had a Security Agreement
in place that covered personal property.
However, the bank’s lien was perfected by
a UCC filing with the Secretary of State.
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The bank did not file a fixture filing statement with the county recorder that covered
items considered to be fixtures. The Court
held that the landlord’s lien was perfected
once the distress warrant was filed. The
distress warrant was filed thus perfecting
the landlord’s lien interest in the fixtures
and trade fixtures, and therefore, it was
superior to the bank’s lien on fixtures since
the bank had failed to perfect by filing a
fixture filing. As to personal property that
was not considered a fixture or trade fixture and thus were easily removable from
the property without causing substantial
damage, it belonged to the bank because
the bank had filed a UCC Financing
Statement and perfected its interest in the
removable personal property prior to the
landlord perfecting its interest. Therefore,
the Court clearly stated, that the priority between a landlord’s lien and a lien
under the Uniform Commercial Code is
based upon which lien is perfected first.
Because the UCC Financing Statement
covering personal property that was filed
with the Secretary of State perfected the
bank’s security interest in said property
prior to the landlord perfecting its lien by
filing a distress warrant, that bank had the
right to removable property. However,
the landlord had priority over the fixtures
and trade fixtures because its distress warrant was filed before the bank filed a UCC
Fixture Filing with the county recorder.
Another case under the Illinois
Home Repair and Remodeling Act
is decided; Public Act 96-1023
amend the Act effective July 12,
2010. Since Illinois legislature passed the
Home Repair and Remodeling Act (815
ILCS 513/5 et seq.) there has been much
litigation over this legislation. Not all of
the Courts in Illinois have agreed on the
outcome. Most of the litigation has been
centered on homeowners raising a defense
in a mechanics lien action against them
by a contractor. A typical case is where a
contractor does repair or remodeling work
for a homeowner and then is not paid for
one reason or another. The contractor
then files a mechanics lien under Illinois
statutory law. Buyers then raise a defense
to the Mechanics Lien Act saying that a
contractor cannot take advantage of the
Mechanics Lien Act if they are in violation of the separate Home Repair and
Remodeling Act which provided:
It is unlawful for any person engaged
in the business of home repairs and
remodeling to remodel or make
repairs or charge for remodeling or
repair work before obtaining a signed
contract or work order over $1,000
and before notifying and securing the
signed acceptance or rejection, by the
consumer, of the binding arbitration
clause and jury trial waiver clause
as required under Section 15 and
Section 15.1 of this Act. This conduct
is unlawful but is not exclusive nor
meant to limit other kinds of methods,
acts or practices that may be unfair or
deceptive.
815 ILCS 513/30. Over the past few
years the D.R. Exclusive has reported
on many of these cases. Some Courts
have held that this language in the Home
Repair and Remodeling Act prevented a
contractor from enforcing a mechanics
lien. However, some Appellate Courts
in Illinois held otherwise. In the most
recent case that was decided on June 30,
2010, the Appellate Court of the First
District of Illinois reversed a Trial Court’s
opinion and found in favor of the contractor and allowed him to proceed with
his rights under the mechanics lien law
even though he had failed to follow all of
the procedures, such as providing a consumer rights brochure, under the Illinois
Home Repair and Remodeling Act. In
Universal Structures Ltd. v. Buchman
(210 Ill.App.LEXIS 656) the contractor
submitted numerous work orders totaling
$1,339,042.04 for remodeling services.
The homeowners paid all but $104,497.65.
The contractor filed a mechanics lien and
brought an action to foreclose their lien.
The homeowners defended the mechanics
lien action by arguing that the contractor
had failed to present a written contract or
work order for them to sign and had failed
to provide the consumer rights brochure
required under the Home Repair and
Remodeling Act. The Appellate Court
held that the failure to provide the consumer rights brochure and failure to have
a written contract in accordance with the
Home Repair and Remodeling Act did
not preclude the contractor from asserting
rights under the separate Mechanics Lien
Act.
In the wake of litigation over the last
few years, the General Assembly passed
and the governed signed Public Act
96-1023 which became effective July 12,
2010. The Act deleted language stating
that it was unlawful for any person to
engage in a business of home repairs and
remodeling before obtaining a signed contract. (The language quoted above). The
Act replaced that language with the right
for a homeowner to bring an action pursuant to the Consumer Fraud and Deceptive
Business Practices Act for any actual damage suffered as a result of a violation of
the Home Repair and Remodeling Act. It
is anticipated that this Act will put an end
to the litigation over whether the Home
Repair and Remodeling Act precludes a
mechanics lien action. The Public Act
makes it clear that the Home Repair and
Remodeling Act is not a way to preclude a
contractor from bringing a mechanics lien
action. n
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Housing Statistics
Illinois Second Quarter Home Sales Gain 27.7 Percent
Statewide Median Price Stable at $160,000
Second quarter Illinois home sales figures reflected the continued positive impact of the tax
credit and strong buyer market conditions while the statewide median price showed stability
over the entire second quarter. According to the Illinois Association of REALTORS® (IAR)
second quarter 2010 report, Illinois home sales (which include single-family homes and condominiums) totaled 35,628 in the second quarter, up 27.7 percent from 27,890 home sales in
the same period a year ago.
The last quarter when sales totals were higher than second quarter 2010 was third quarter
2007 when home sales reached 39,904. The second quarter statewide median home sale price
was $160,000, up 0.3 percent from $159,500 in the second quarter of 2009.
“The first half of the year has solidly placed the Illinois housing market in a better position
compared to a year ago with year-to-date sales up 26.3 percent through June and the year-to-date
median price improved from a year ago. Buyers will find affordability levels very high at this
time before the inevitable uptick in mortgage interest rates, which are currently at their lowest
level in decades,” said REALTOR® Mike Onorato, GRI, president of the Illinois Association
of REALTORS® and broker-owner of Onorato Real Estate in Coal City. “We are looking to the
economy now for more positive signs in terms of jobs and consumer confidence. These factors
and foreclosures will have the biggest impact on housing in the second half.”
In the Chicagoland Primary Metropolitan Statistical Area (PMSA) total home sales (singlefamily and condominiums) jumped 34.7 percent in the second quarter of 2010 to 23,735 homes
sold compared to 17,620 home sales in the second quarter of 2009.
Similar to statewide data, the last quarter when home sales for the region were higher than
second quarter 2010 was third quarter 2007 when home sales reached 26,257.
The Chicagoland PMSA second quarter 2010 median price was $196,000, down 2.5 percent
from $201,000 in the second quarter of 2009. n
Market Perspectives
The outlook for the economy and housing does remain unusually uncertain. But let’s keep in mind
that even in the worst possible case, there will be some level of home sales. Remember that back in
1982 mortgage rates averaged 18 percent; there were 40 million fewer jobs back then compared to
now. – NAR Real Estate Insights, 8/10
Now it is the economy that is pulling down housing. Without sustained job growth the housing market
likely won’t improve. That in turn will ricochet across manufacturing, retail and other trades heavily
dependent on home building and consumer spending. – The Wall Street Journal, 7/21/10
Illinois
Forecast
“I believe
the housing
market that
really led the
growth rates
in the early
part of this
century are now very much
tied to job growth. Most people
are going to feel much better
about making major purchases
if they can have a sense that
the private sector job growth
is going to continue,” said
Dr. Geoffrey J.D. Hewings,
director of the Regional
Economics Applications
Laboratory (REAL) of the
University of Illinois. “As a result
we will see a very strong relationship between home sales
and job growth over the next six
to 18 months, much more than
we’ve seen in the past.”
• Forecasts for sales for the
next three months (AugustOctober) indicate a continuation of the July experience
with declines in the 14-38%
range statewide and 13-24%
for Chicagoland.
• The “hangover” from the
expiration of the tax credit
in April may extend into fall.
Prices continue their downward trend.
> Find market talking points,
county data and REAL forecasts in the IAR members
only section of Market Stats,
www.illinoisrealtor.org/
membermarketstats.
Foreclosed homes permeate the American landscape. According to data from the Massachusetts
Institute of Technology (MIT), they make up about one in 12 houses with under $1 million left on the
mortgage. These foreclosures drive down home prices, and MIT gives two reasons for their depreciating effect: Foreclosed homes add to the housing supply and the financial firms that acquire the
houses want to unload them promptly. - MIT, 7/20/10
Employment stability and job growth are keys to a housing recovery. In addition to alleviating workers’
fears about losing their next paycheck, improving employment measures help boost the confidence of
households that are considering buying a home. - National Association of Home Builders, 7/9/10
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IAR Quarterly Housing Sur vey by County
Interest Rates*
Total Home Sales 2Q 2010
County
Q2 2009
Q2 2010
%Change Q2 2009 Median Q2 2010 Median
% Change
ADAMS 208 218 4.8 % $100,750 $94,500 -6.2 %
BOONE 169 215 27.2 % $127,000 $119,000 -6.3 %
CHAMPAIGN 575 702 22.1 % $141,000 $141,750 0.5 %
CHRISTIAN 95 86 -9.5 % $79,900 $70,000 -12.4 %
CLINTON 69 86 24.6 % $116,900 $112,000 -4.2 %
120 146 21.7 % $87,000 $86,000 -1.1 %
10,074 13,528 34.3 % $204,000 $200,000 -2.0 %
265 -3.3 % $163,000 $150,000 -8.0 %
-4.2 %
COLES COOK DE KALB 274 DU PAGE 2,039 2,754 35.1 % $240,000 $230,000 EFFINGHAM 80 125 56.3 % $114,250 $105,000 -8.1 %
FRANKLIN 65 82 26.2 % $63,000 $49,250 -21.8 %
FULTON 63 94 49.2 % $65,000 $62,650 -3.6 %
GRUNDY 116 160 37.9 % $162,950 $158,500 -2.7 %
JACKSON 116 135 16.4 % $101,500
$115,000 13.3 %
JEFFERSON 79 90 13.9 % $82,000 $78,950 -3.7 %
KANE 972 1,588 63.4 % $200,000 $175,000 -12.5 %
KANKAKEE 419 400 -4.5 % $135,000 $123,950 -8.2 %
KENDALL 346 480 38.7 % $186,352 $175,500 -5.8 %
KNOX 135 123 -8.9 % $63,900 $79,000 23.6 %
-7.1 %
LA SALLE 248 284 14.5 % $105,000 $97,500 1,531 2,114 38.1 % $195,000 $202,000 3.6 %
139 100 -28.1 % $107,500 $90,000 -16.3 %
LIVINGSTON
89 85 -4.5 % $93,000 $101,500 9.1 %
LOGAN 70 89 27.1 % $82,950 $77,000 -7.2 %
MACON 261 303 16.1 % $92,900 $95,500 2.8 %
LAKE LEE MACOUPIN MADISON
MARION 79 107 35.4 % $79,000 $84,900 7.5 %
785 847 7.9 % $115,800 $116,250 0.4 %
86 100 16.3 % $57,500 $77,100 34.1 %
MCHENRY 706 918 30.0 % $190,000 $170,000 -10.5 %
MCLEAN 583 645 10.6 % $150,000 $160,500 7.0 %
MONROE 72 99 37.5 % $183,500 $171,000 -6.8 %
MORGAN 91 109 19.8 % $85,500 $90,000 5.3 %
OGLE 122 197 61.5 % $134,501 $125,000 -7.1 %
PEORIA 587 664 13.1 % $119,000 $116,950 -1.7 %
ROCK ISLAND 310 405 30.6 % $99,900 $95,000
-4.9 %
SAINT CLAIR 631 767 21.6 % $124,500 $127,000 2.0 %
SANGAMON 709 844 19.0 % $117,900 $126,375 7.2 %
STEPHENSON 130 141 8.5 % $78,500 $84,000 7.0 %
1.9 %
TAZEWELL 443 534 20.5 % $127,500 $129,950 VERMILION 145 162 11.7 %
$66,000 $68,250 3.4 %
WHITESIDE 258 152 -41.1 % $82,000 $81,450 -0.7 %
-1.6 %
1,562 1,928 23.4 % $181,838 $178,950 WILLIAMSON WILL 185 196 5.9 % $96,000 $104,000 8.3 %
WINNEBAGO 779 1,121 43.9 % $111,100 $107,500 -3.2 %
WOODFORD 88 85 -3.4 % $156,000 $155,500 -0.3 %
Chicagoland PMSA 17,620 23,735 34.7 % $201,000 $196,000 -2.5 %
Total 35,628 27.7 % $159,500 $160,000 0.3 %
27,890 (www.freddiemac.com)
*average for the North Central
Region which includes Illinois
4.94 – 2Q10
5.07 – 2Q09
5.03 – 1Q10
Homeownership Rates
(www.census.gov)
2Q10 U.S. 66.9% Midwest 70.8% Illinois 69.9% 2Q09
67.4%
70.5%
69.2%
View the video forecast series
with Dr. Hewings at
www.illinoisrealtor.org/
marketstats.
•
•
•
Illinois Housing Market
Outlook
Jobs and the Illinois
Housing Market
Positive Factors for the
Housing Market
Sales and price information
is generated from a survey of
Multiple Listing Service sales
reported by 37 participating Illinois REALTOR® local
boards and associations. The
Chicago PMSA, as defined
by the U.S. Census Bureau,
includes the counties of Cook,
DeKalb, DuPage, Grundy,
Kane, Kendall, Lake, McHenry
and Will.
Only counties reporting 50 or more sales in 2Q 2010 appear in the chart above.
Get the full report at www.illinoisrealtor.org/membermarketstats.
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Industr y News
IAR Calendar
Fall Fundraising Push for RPAC. Although
October 31, 2010, is the official end of the current fundraising
year for the REALTORS® Political Action Committee (RPAC),
contributions must be received by IAR by October 15, 2010
in order for members to receive recognition from the National
Association of REALTORS® for this fundraising year. www.illinoisrealtor.org
Look for details at
September 27 – Real Estate
Educational Foundation Golf
Outing, Pheasant Run Resort,
St. Charles
www.illinoisrealtor.org/rpac
Homebuyer Tax Credit Still Available to U.S. Service MemberS.
Members of the uniformed services, Foreign Service and employees of the intelligence
community serving outside the United States were given more time - on or before April 30,
2011- to qualify for the federal homebuyer tax credit. IAR has created a consumer handout on
the military tax credit. www.yourillinoishome.com/militarytaxcreditflyer.pdf.
Learn more from www.IRS.gov.
• REMINDER - The tax credit closing deadline is September 30, 2010 for other qualifying
homebuyers who had ratified contracts in place by April 30, 2010.
GRI in One Location This Winter. The Illinois Graduate REALTOR® Institute will
again be held in one location, Nov. 29-Dec. 2, 2010, at the Doubletree Hotel in Bloomington.
The early-bird registration deadline is Nov. 3. www.illinoisrealtor.org/GRI.
IAR Designation Guide. A comprehensive list of real estate professional designations
can be found in the new Illinois Association of REALTORS® Designation Guide.
www.illinoisrealtor.org/files/Education/IllinoisDesignationGuide.pdf.
Issues on the National Front
•
Rural Housing Funding Restored - The Section 502 Rural Housing Service Single-Family
Housing Guaranteed Loan Program now requires a 3.5 percent (up from 2 percent) guarantee fee
paid at closing. The higher fee, which can be rolled into the loan with no PMI, is aimed at making the popular rural housing program self sustaining. In Illinois, the Illinois Rural Development
Program, administered by the Partnership for HomeOwnership, helps low-income, first-time buyers
in rural areas of Illinois finance a home.
•
National Flood Insurance Program Extended Until September 30, 2010 While the National Flood Insurance Program (NFIP) was extended short-term through the end of
September 27 - 29, IAR
Business Meetings, Pheasant
Run Resort, St Charles
September 29 - Oct 1, IAR
Annual Convention, Pheasant
Run Resort, St Charles
September 29, Illinois YPN
Speed Networking Session,
Pheasant Run Resort, St.
Charles
October 19-20 - IAR Leadership
Conference, East Peoria
November 3-8, REALTORS®
Conference & Meetings, New
Orleans
November 29-December 2, GRI
Institute, Bloomington
December 1-2, GRI Grad
Course, Bloomington
January 4, Professional
Standards, Springfield
January 5, Professional
Standards, Oakbrook
January 25-27, IAR Public
Policy Meetings, East Peoria
January 26, RPAC Auction, East
Peoria
September, NAR continues to work with Congress for a longer-term solution that would include
reauthorizing the program until September 30, 2015.
•
Enforcement Delayed Until October 1 for Lead-based Paint Rules - With contractors and renovators having difficulties getting the required certification training required under
the lead-based paint rules regarding renovation, repair and painting (RPR) that went into effect
in April, the U.S. Environmental Protection Agency (EPA) will not take enforcement actions until
October 1, 2010.
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> < > <
Industr y News continued
The National Association of REALTORS® Right Tools/Right Now
Program Soon To End. Take advantage of the deals before they are gone.
Right Tools, Right Now offers hundreds of products, publications and services for free
or at-cost, but act quickly as the popular REALTOR® program comes to an end this year.
www.realtor.org/prodser.nsf/righttools/toolshome?opendocument.
Don’t Miss the IAR Convention & Expo.
It’s a new location and a lineup of sought-after industry educators and
speakers at the 2010 IAR Convention & Expo, September 29-October
1, at Pheasant Run Resort and Spa in St. Charles. Speakers include
negotiation pro Steve Harney, coach and columnist Bernice Ross,
social media expert Doug Devitre, memory coach Tom Weber and top
trainers Kim Daugherty, Lynn Madison and Kevin Stahle. www.illinoisrealtor.org/convention.
Digital Magazine on Droid, BlackBerry and iPhone
The digital version of Illinois REALTOR® is now
viewable on BlackBerry, Android and iPhone
smartphones as well as on iPads.
http://digitalmag.illinoisrealtor.org
Get the latest
industry news
and views with
IARbuzz
Sign up to receive IAR blogposts by e-mail at www.iarbuzz.
com. The IAR blog keeps you
up-to-date with industry trends
and issues—from homebuyer
trends and home sales statistics
to technology tips and useful
Discipline Cases
content on illinoisrealtor.org.
Following are recent disciplinary actions taken by the Real Estate Division of
the Illinois Department of Financial and Professional Regulation, www.idfpr.com.
See what your
IAR memberGO
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UN
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ship offers you
IRS
and share this
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resource with
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p. 15 | D.R. Le gal N e w s | S e p t e m b e r 2 0 1 0 | © I L L I N O I S A S S O C I AT I O N O F R E A LTO R S ®
Download the
IAR Member
Benefits Guide
FA
> A real estate broker license was placed in refuse to renew status for dishonorable, unethical
or unprofessional conduct of a character likely to deceive, defraud or harm the public.
> A real estate broker license was placed in refuse to renew status and fined $800 for failure to
fulfill continuing education requirements.
> A real estate salesperson license was indefinitely suspended for failure to file and/or pay
Illinois state income taxes.
> An unlicensed person was ordered to pay a $10,000 civil penalty for unlicensed appraisal practice.
> An unlicensed company was ordered to cease and desist the unlicensed practice of real estate
brokerage, sales and leasing.
> A certified general real estate appraiser license was revoked and fined $3,000 after submitted a false
certification to the Department that he completed the required 28 hours of continuing education.
> A certified residential real estate appraiser license was placed in refuse to renew status for
USPAP violations and for failure to respond to Department inquiries.
> A certified residential real estate appraiser license was reprimanded and fined $1,000 for
using inappropriate comparable properties.
> A certified residential real estate appraiser license was revoked after the licensee completed
an appraisal that indicated an incorrect zoning classification of the building and for failure to
respond to the Department inquiries. n
ion of REALTOR
S®: Member
Benefits Guide
2
www.illinoisrealtor.org/
memberbenefits
> < > <
September
2010
WE’D LIKE TO
HEAR FROM YOU
Send comments
and story ideas to
> i arnews @iar.org
© Copyright Illinois
A s sociation of REALTORS ®
5 2 2 South Fifth Street
P. O. Box 19451
S p ringfield, Illinois
6 2 794-9451
2 1 7/52 9-2 600
FAX 217/529-3904
www.illinoisrealtor.org
www.IARlicenselaw.org
www.YourIllinoisHome.com
www.IARbuzz.com
find us on
> f acebook.com
> t witter.com/ILREALTOR
> l inkedin.com
D.R. Legal News
Illinois Association of REALTORS®
2010 Convention & Expo
> <
Build
your business!
Sept. 29 - Oct. 1
Pheasant Run Resort &
Spa, St. Charles, IL
Learn from top trainers
about the latest in business planning, social media,
technology tools, timetested marketing trends and
memory power. And earn up
to six continuing education
credit hours included in the
cost of full registration.
REGISTER ONLINE!
www.illinoisrealtor.org/
convention
#IAR2010
IARbuzz.com
RPAC: Your Best Investment in Real Estate
Some call the REALTORS® Political Action Committee
an insurance policy for their real estate business. Why?
Because RPAC exists solely to elect candidates for public
office who understand and support our interests.
Now is the time to make RPAC
your monthly business expense.
a
The new fundraising year begins November 1.
Set up a monthly plan to break your contribution
into 12 monthly installments by calling
Joni Bergschneider at 217/529-2600.
Learn more and make a donation at any level at www.illinoisrealtor.org/RPAC.
RPAC Contributions, either state or federal, are not deductible as charitable contributions for federal income tax purposes.
Contributions to RPAC are voluntary. Refusal to contribute does not affect membership rights. All personal contributions will
be credited to the IAR Federal PAC and will be charged against your contribution limits under 2 U.S.C.441a. All other contributions will be credited to Illinois RPAC. Copies of reports for Illinois RPAC are filed with the State Board of Elections and are
(or will be) available for purchase from the State Board of Elections, Springfield, Illinois.
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