First of all not all real estate licensees in Tennessee are REALTORS®. REALTORS® are real estate licensees who have made a professional decision to become members of the National Association of REALTORS ® through the Knoxville Area Association of REALTORS® and adhere to a strict Code of Ethics with Standards of Practice that promote the fair, ethical and honest treatment of all parties in a transaction in addition to the Real Estate Laws of Tennessee. The term REALTOR® and the familiar Block “R” logo are trademarked by the National Association of REALTORS® and can only be used by REALTORS®. REALTORS® improve their professionalism through education and designation programs.

Many homeowners and homebuyers are not aware of the true value a REALTOR® provides during the course of a real estate transaction. At the same time, regrettably, REALTORS® have generally assumed that the expertise, professional knowledge and just plain hard work that go into bringing about a successful transaction were understood and appreciated. Many of the most important services and steps are performed behind the scenes by either the REALTOR® or their brokerage staff and traditionally have been viewed simply as part of their professional responsibilities to the client. But, without them, the transaction could be placed in jeopardy.

REALTORS® routinely provide a wide variety of services that are as varied as the nature of each transaction. Some transactions may not require as many steps to be equally successful. However, most REALTORS® would agree that given the unexpected complications that can arise, it’s far better to know about a step and make an intelligent, informed decision to skip it, than to not know the possibility even existed.

Through out a transaction, the personal and professional commitment of the REALTOR® is to ensure that a seller and buyer are brought together in an agreement that provides each with a “win” that is fair and equitable. The motivation is easy to understand - for most REALTORS® will receive no compensation unless and until the transaction closes. By contrast, there are firms that offer “limited services” in exchange for an up-front flat fee, or perhaps offer a menu of pay-as-you-go or “a la’ carte” options. Some even offer a sliding scale ranging from limited to full service. In these cases, the compensation of the REALTOR® is based on these reduced service levels with the seller bearing full responsibility for all the other steps and procedures in the selling process. A new Tennessee Law that became effective July 1, 2006 now requires a “limited services” firm to make sure the seller understands and agrees fully to the services they will and will not receive. In short, the marketplace truism is that “you get what you pay for.”

Here are the typical actions, research steps, processes and review stages necessary for a successful residential real estate transaction and normally provided by a REALTOR® for which they are entitled to fair compensation.

Pre-Listing Activities

1 Make appointment with seller for listing presentation
2 Send seller a written or e-mail confirmation of listing appointment and call to confirm
3 Review pre-appointment questions
4 Research all comparable currently listed properties
5 Research sales activity for past 18 months from MLS and public records databases
6 Research "Average Days on Market" for this property of this type, price range and location
7 Download and review property tax roll information
8 Prepare "Comparable Market Analysis" (CMA) to establish fair market value
9 Obtain copy of subdivision plat/complex lay-out
10 Research property's ownership & deed type
11 Research property's public record information for lot size & dimensions
12 Research and verify legal description
13 Research property's land use coding and deed restrictions
14 Research property's current use and zoning
15 Verify legal names of owner(s) in county's public property records
16 Prepare listing presentation package with above materials
17 Perform exterior "Curb Appeal Assessment" of subject property
18 Compile and assemble formal file on property
19 Confirm current public schools and explain impact of schools on market value
20 Review listing appointment checklist to ensure all steps and actions have been completed

Listing Appointment Presentation

21 Give seller an overview of current market conditions and projections
22 Review agents and company's credentials and accomplishments in the market
23 Present company's profile and position or "niche" in the marketplace
24 Present CMA Results to Seller, including Comparables, Solds, Current Listings and Expireds
25 Offer pricing strategy based on professional judgment and interpretation of current market conditions
26 Discuss Goals with Seller to Market Effectively
27 Explain market power and benefits of Multiple Listing Service
28 Explain market power of web marketing, the MLS IDX program and REALTOR.com
29 Explain the work the brokerage and agent do "behind the scenes" and agent's availability on weekends.
30 Explain agent's role in taking calls to screen for qualified buyers and protect seller from curiosity seekers
31 Present and discuss strategic master marketing plan
32 Explain different agency relationships and determine seller's preference
33 Review and explain all clauses in Listing Contract & Addendum and obtain seller's signature

Once Property is Under Listing Agreement

34 Review current title information
35 Measure overall and heated square footage
36 Measure interior room sizes
37 Confirm lot size via owner's copy of certified survey, if available
38 Note any and all unrecorded property lines, agreements, easements
39 Obtain house plans, if applicable and available
40 Review house plans and make copy
41 Order plat map for retention in property's listing file
42 Prepare showing instructions for buyers' agents and agree on showing time window with seller
43 Obtain current mortgage loan(s) information: companies and & loan account numbers
44 Verify current loan information with lender(s)
45 Check assumability of loan(s) and any special requirements
46 Discuss possible buyer financing alternatives and options with seller
47 Review current appraisal if available
48 Identify Home Owner Association manager if applicable
49 Verify Home Owner Association Fees with manager - mandatory or optional and current annual fee
50 Order copy of Homeowner Association bylaws, if applicable
51 Research electricity availability and supplier's name and phone number
52 Calculate average utility usage from last 12 months of bills
53 Research and verify city sewer/septic tank system
54 Water System: Calculate average water fees or rates from last 12 months of bills )
55 Well Water: Confirm well status, depth and output from Well Report
56 Natural Gas: Research/verify availability and supplier's name and phone number
57 Verify security system, current term of service and whether owned or leased
58 Verify if seller has transferable Termite Bond
59 Ascertain need for lead-based paint disclosure
60 Prepare detailed list of property amenities and assess market impact
61 Prepare detailed list of property's "Inclusions & Conveyances with Sale"
62 Compile list of completed repairs and maintenance items
63 Send "Vacancy Checklist" to seller if property is vacant
64 Explain benefits of Home Owner Warranty to seller
65 Assist sellers with completion and submission of Home Owner Warranty Application
66 When received, place Home Owner Warranty in property file for conveyance at time of sale
67 Have extra key made for lockbox
68 Verify if property has rental units involved. And if so:
69 Make copies of all leases for retention in listing file
70 Verify all rents & deposits
71 Inform tenants of listing and discuss how showings will be handled
72 Arrange for installation of yard sign
73 Assist seller with completion of Seller's Disclosure form
74 "New Listing Checklist" Completed
75 Review results of Curb Appeal Assessment with seller and provide suggestions to improve salability
76 Review results of Interior Décor Assessment and suggest changes to shorten time on market
77 Load listing into transaction management software program

Entering Property in the Multiple Listing Service Database

78 Prepare MLS Profile Sheet – they are responsible for "quality control" and accuracy of listing data
79 Enter property data from Profile Sheet into MLS Listing Database
80 Proofread MLS database listing for accuracy - including proper placement in mapping function
81 Add property to company's Active Listings list
82 Provide seller with signed copies of Listing Agreement and MLS Profile Sheet Data Form
83 Take additional photos for upload into MLS and use in flyers.

Marketing The Property

84 Create print and Internet ads with seller's input
85 Coordinate showings with owners, tenants, and other REALTORS® Return all calls – weekends included
86 Install an MLS electronic lock box if authorized by owner. Program with agreed-upon showing time windows
87 Prepare mailing and contact list
88 Generate mail-merge letters to contact list
89 Prepare flyers & feedback faxes
90 Review comparable MLS listings regularly to ensure property remains competitive in Price, terms, conditions and availability
91 Prepare property marketing brochure for seller's review
92 Arrange for printing or copying of supply of marketing brochures or fliers
93 Place marketing brochures in all company agent mail boxes
94 Upload listing to company and agent Internet site
95 Mail Out "Just Listed" notice to all neighborhood residents
96 Advise Network Referral Program of listing
97 Provide marketing data to buyers coming through international relocation networks
98 Provide marketing data to buyers coming from referral network
90 Provide "Special Feature" cards for marketing, if applicable
100 Submit ads to company's participating Internet real estate sites
101 Price changes conveyed promptly to all Internet groups
102 Reprint/supply brochures promptly as needed
103 Loan information reviewed and updated in MLS as required
104 Feedback e-mails/faxes sent to buyers' agents after showings
105 Review weekly Market Study
106 Discuss feedback from showing agents with seller to determine if changes will accelerate the sale
107 Place regular weekly update calls to seller to discuss marketing & pricing
108 Promptly enter price changes in MLS listing database

The Offer and Contract

109 Receive and review all Offer to Purchase contracts submitted by buyers or buyers' agents.
110 Evaluate offer(s) and prepare a "net sheet" on each for the owner for comparison purposes
111 Counsel seller on offers. Explain merits and weakness of each component of each offer
112 Contact buyers' agents to review buyer's qualifications and discuss offer
113 Fax/deliver Seller's Disclosure to buyer's agent or buyer upon request and prior to offer if possible
114 Confirm buyer is pre-qualified by calling Loan Officer
115 Obtain pre-qualification letter on buyer from Loan Officer
116 Negotiate all offers on seller's behalf, setting time limit for loan approval and closing date
117 Prepare and convey any counteroffers, acceptance or amendments to buyer's agent
118 Fax copies of contract and all addendums to closing attorney or title company
119 When Offer to Purchase Contract is accepted and signed by seller, deliver to buyer's agent
120 Record and promptly deposit buyer's earnest money in escrow account.
121 Disseminate "Under-Contract Showing Restrictions" as seller requests
122 Deliver copies of fully signed Offer to Purchase contract to seller
123 Fax/deliver copies of Offer to Purchase contract to Selling Agent
133 Fax copies of Offer to Purchase contract to lender
124 Provide copies of signed Offer to Purchase contract for office file
125 Advise seller in handling additional offers to purchase submitted between contract and closing
126 Change status in MLS to "Sale Pending"
127 Update transaction management program to show "Sale Pending"
128 Review buyer's credit report results -- Advise seller of worst and best case scenarios
129 Provide credit report information to seller if property will be seller-financed
130 Assist buyer with obtaining financing, if applicable and follow-up as necessary
131 Coordinate with lender on Discount Points being locked in with dates
132 Deliver unrecorded property information to buyer
133 Order septic system inspection, if applicable
134 Receive and review septic system report and assess any possible impact on sale
135 Deliver copy of septic system inspection report lender & buyer
136 Deliver Well Flow Test Report copies to lender & buyer and property listing file if required
137 Verify termite inspection ordered
138 Verify mold inspection ordered, if required

Tracking the Loan Process

139 Confirm Verifications Of Deposit & Buyer's Employment Have Been Returned
140 Follow Loan Processing Through To The Underwriter
141 Add lender and other vendors to transaction management program so agents, buyer and seller can track progress of sale
142 Contact lender weekly to ensure processing is on track
143 Relay final approval of buyer's loan application to seller

Home Inspection

144 Coordinate buyer's professional home inspection with seller
145 Review home inspector's report
146 Enter completion into transaction management tracking software program
147 Explain seller's responsibilities with respect to loan limits and interpret any clauses in the contract
148 Ensure seller's compliance with Home Inspection Clause requirements
149 Recommend or assist seller with identifying and negotiating with trustworthy contractors to perform any required repairs
150 Negotiate payment and oversee completion of all required repairs on seller's behalf, if needed

The Appraisal

151 Schedule Appraisal
154 Provide comparable sales used in market pricing to Appraiser
152 Follow-Up on Appraisal
151 Enter completion into transaction management program
153 Assist seller in questioning appraisal report if it seems too low

Closing Preparations and Duties

154 Contract Is Signed By All Parties
155 Coordinate closing process with buyer's agent and lender
156 Update closing forms & files
157 Ensure all parties have all forms and information needed to close the sale
158 Select location where closing will be held
159 Confirm closing date and time and notify all parties
160 Assist in solving any title problems (boundary disputes, easements, etc) or in obtaining Death Certificates
161 Work with buyer's agent in scheduling and conducting buyer's Final Walk-Thru prior to closing
172 Research all tax, HOA, utility and other applicable prorations
162 Request final closing figures from closing agent (attorney or title company)
163 Receive & carefully review closing figures to ensure accuracy of preparation
164 Forward verified closing figures to buyer's agent
165 Request copy of closing documents from closing agent
166 Confirm buyer and buyer's agent have received title insurance commitment
167 Provide "Home Owners Warranty" for availability at closing
168 Review all closing documents carefully for errors
169 Forward closing documents to absentee seller as requested
170 Review documents with closing agent (attorney)
171 Provide earnest money deposit check from escrow account to closing agent
173 Coordinate this closing with seller's next purchase and resolve any timing problems
174 Have a "no surprises" closing so that seller receives a net proceeds check at closing
175 Refer sellers to one of the best agents at their destination, if applicable
176 Change MLS status to Sold. Enter sale date, price, selling broker and agent's ID numbers
177 Close out listing in transaction management program

Follow Up After Closing

178 Answer questions about filing claims with Home Owner Warranty company if requested
179 Attempt to clarify and resolve any conflicts about repairs if buyer is not satisfied
180 Respond to any follow-on calls and provide any additional information required from office files.

2. How do I safety proof my home for children? |Back to top

Whether your are just now guessing which color to paint your nursery or have a little one that is ready to crawl, taking preventive measures to childproof your home against unintentional accidents is essential. Even you don't want your children to get into something, it seems that they can always find a way to do so. Specialists in child safety recommend that parents get down on their hands and knees and take a look around the house from a child's viewpoint.

Consider the following room-by-room tips to help make your home safer for your children:

SAFETY MEASURES FOR ALL ROOMS

• Install child-resistant covers on all unused electrical outlets.
• Keep all mini-blind cords out of reach.
• Tape down the corners of area rugs or electrical cords that might trip children.
• Place furniture well away from all windows.
• Keep cigarettes, matches and lighters out of reach.
• Place screened barriers around fireplaces, radiators and portable space heaters.
• Keep firearms and ammunition safely locked away.
• Secure unsteady furnishings.
• Be vigilant about choking hazards. ( Anything that fits inside a toilet paper tube has the potential to choke a child. )

LIVING ROOM

• Secure bookcases to the wall, using shelf brackets attached to the side and/or top of the bookcase, and then screw into the wall.
• Secure or remove heavy or breakable items from tables, as children are likely to grab or shake them, causing whatever is on top to move or fall off.
• Use corner bumpers on furniture and fireplace hearth edges.
• Keep the houseplants high. ( The objective here is two-fold: to keep a falling plant from hurting your child and potentially poisonous houseplants out of reach. )

KITCHEN

• Install childproof latches on all cabinets and appliances within a child's reach.
• Keep knives, cleaning supplies, and plastic bags out of reach.
• On stoves, keep the handles of pots and pans turned toward the wall. Never leave cooking food unattended.
• If stove knobs are easily accessible to children, use protective covers to prevent kids from turningthem on.
• Keep chairs and step stools away from counters and stove.
• Keep syrup of ipecac on hand.

BABY’S ROOM

• Place infants under one year of age on their backs to sleep.
• Crib bar spacing should be no greater than 2-3/8 inches, smaller than the diameter of a soda can.
• Position the Crib away from all drapery, electrical cords, and windows.
• Be sure the crib sheet fits snugly.
• For crib bumpers, make sure it's firm ( not fluffy ) and secured tightly with at least six ties.
• Remove mobiles and other hanging toys from the crib as soon as a child can reach up and touch them.
• Never use an electric blanket in the bed or crib of a small child or infant.

STAIRS AND HALLWAYS

• Have two safety gates, one at each end of the staircase.
• Brighten dark hallways.
• Install carbon-monoxide ( CO ) alarms and smoke alarms in each room on every level of the home.

WINDOWS AND DOORS

• Mark sliding glass doors with colored tape or stickers to distinguish them from open doorways.
• Place sleeves on doorknobs to prevent toddlers from accessing dangerous areas of the house.
• Use doorstops to ensure that doors can't slam shut.

BATHROOMS

• Turn down the hot water heater temperature to a maximum of 120 degrees.
• As in the kitchen, lock or tie cabinet doors, and move all soaps and shampoos to higher surfaces ( especially colorful ones, or varieties that have tempting scents like vanilla or strawberry ).
• Place a non-slip mat or stickers on the bottom of your bathtub.
• Put locks on medicine and cleaning supply cabinets.
• Cover the bathtub waterspout with a soft, protective cover.
• Install toilet lid locks.
• Install ground-fault circuit interrupters on outlets near all sinks and bathtubs.

If you are unsure about any of the items listed, ask a professional. Professionals may come to your home to "child or baby-proof" it by installing protectors and locks, while looking for hazards that might go unnoticed. Your family doctor or pediatrician may be a great resource for locating reliable, inexpensive professionals that may perform these services in your area.

3. What does “As Is” Mean? |Back to top

Words in a contract intended to signify that no guarantees whatsoever are given regarding the subject property and that it is being purchased exactly as it is found. An "As Is" indicator is intended to be a disclaimer of warranties or representations. The recent trend in the courts to favor consumers tends to prevent sellers from using " As Is " wording in a contract to shield themselves from possible fraud charges brought by neglecting to disclose material defects in the property.

Even though an "As Is" clause may give some protection to the seller from unknown defects, the clause is inoperative when the seller actively misrepresents the condition of the property. It does not shield the seller who fails to repair a readily observable defect, basically saying "You take it as you see it." The idea is that the buyer takes the visible condition into account when making an offer and setting the purchase price. Therefore, if a buyer should be expected to discover a defect upon a reasonable inspection, the buyer will be charged with notice; otherwise, the broker and/or seller have the affirmative duty to inform the buyer of the defect, preferably in writing.

Sellers can protect themselves by being specific in the contract, for example, about recurring plumbing problems, a cracked foundation, leaky roof, den built without a building permit, all in "As-Is" condition. If for example, the roof defect was not obvious and the buyer did not know of this material defect, but the seller did know, then a general "As-Is" clause is probably worthless.

Many contracts contain standard language that must be evaluated in light of an "As-Is" clause. For example, the seller may still be required to provide a termite report even though the property is sold "As- Is". In such a case, the seller may want to affirmatively delete the standard termite clause. Also, "As Is" does not normally cover title encroachment matters unless specifically noted.

Even where an "As-Is" clause can protect a seller, many courts hold that a broker cannot use the "As-Is" clause to avoid liability for misrepresentation, because the broker is not a party to the contract in which the "As-Is" clause is contained.

In appraisals, "As Is" is an indication that the value estimate is made with the property in its current condition, which may not be the highest and best use or may include needed repairs.

Protecting the Seller in an “As Is” Sale

For those Sellers who desire to sell real estate "As Is," with no obligation to make any repairs to the property either before or after the closing. ("As Is" transactions tend to be prevalent in a resale of foreclosed properties, auctions, sales of commercial and industrial, sales of residential landlord properties and many seniors selling their residence. )

The following should occur in order to protect the Seller in an "As Is" Sale.

• The contract cannot state that the Seller has any obligation to make repairs, several contract drafting areas must be addressed.

• All warranty language and all provisions that may require the Seller to make repairs must be removed. The obvious "Seller warrants the condition" clauses must be deleted. Also any repair language clauses for termite, septic, and home inspections.

• Insert an omnibus disclaimer addendum to the contract such as the following in a conspicuous type font (bold/all caps):

“THIS SALE IS MADE AS IS WITH NO WARRANTIES EXPRESS, AND/OR IMPLIED, ALL OF WHICH ARE HEREBY DISCLAIMED. NOT WITHSTANDING ANY PROVISION IN THIS CONTRACT AND RELATED ADDENDUM TO THE CONTRARY, THE SELLER SHALL HAVE NO LIABILITY FOR PROPERTY CONDITION MATTERS AND/OR ANY REPAIR OBLIGATIONS OF ANY NATURE WHATSOEVER”.

• Always have your Principal Broker review the contract.

Protecting the Buyer in an "As Is" Sale

If the Buyer likes the location of the property and wants to proceed with caution on an “As Is “property, the contract must contain an inspection contingency that gives the Buyer a reasonable length of time to have the property inspected by qualified personnel and then allows the Buyer to “Opt Out” of the contract without liability if the condition of the property is not satisfactory to the Buyer.

“As Is” and the Tennessee Property Disclosure Law

If a Seller decides to sell a property "As Is", Agents still have to deal with all disclosures required under the Tennessee Property Condition Act. If the property is exempt under the Act, the Seller is not required to fill out a Property Disclosure Form. If the property is not exempt, the Seller has two options:

1. Fill out a Property Disclosure Form, and still sell the property "As Is" with an appropriate "As Is" contract. The Property Disclosure form is not a contract or a warranty and filling it out does not require the seller to make any repairs.

2. Sell the property by "disclaimer." The Property Disclosure Act allows the Seller to inform the buyer in writing that he does not intend to fill out a Property Disclosure Form. The Seller must secure the Buyer’s signature on an appropriate disclaimer form.

Using an Appropriate Disclaimer to Disclaim any Uniform Commercial Code Warranties

The Uniform Commercial Code in Tennessee governs the sale of items of personal property in Tennessee and creates two types of implied warranties:

1. on implied warranty of fitness for a particular purpose

2. an implied warranty of merchantability. The Uniform Commercial Code also governs disclaiming express warranties on the sale of personal property.

To the extent any personal property is being conveyed with a sale of real estate and/or the Uniform Commercial Code otherwise applies to a transaction, in order to have a true "As Is" sale the Uniform Commercial Code requires that any disclaimers or limitations of express and implied warranties must be in conspicuous type font and contain certain words. In an addendum to the contract the pertinent language must be in the contract, and be in "conspicuous" type font and size. ( See language example above. )

4. What questions should I ask a Mortgage Lender? |Back to top

It is important that you understand how each loan program differs before making the loan application. We would like to suggest you ask these questions.

1. What fixed and adjustable loan programs are available?
2. What are the origination fees and points on these loans?
3. What will the closing costs be?
4. What prepaid items will I be expected to pay?
5. How long does the loan application to approval process take?
6. Will there be a prepayment penalty on the loan?
7. Is there an interest rate lock-in policy?
8. Does the loan have a call provision?
9. Are escrows required for taxes and insurance premiums?

5. Interest Rate vs APR |Back to top

Confusing and mysterious is "annual percentage rates" for mortgage loans. The interest rate and APR don't always make sense.

Interest rate is simply the percentage rate that a lender applies to your mortgage balance to determine the amount of interest due.

The annual percentage rate (APR) includes the interest rate, plus other charges and fees. These can include "points", mortgage insurance, prepaid interest, origination fees, tax service fee, and any buy-down funds.

The lender is required to disclose both the mortgage interest rate and annual percentage rate. If you have a choice of several loan programs, the APR is a good indicator of the true costs of both.

Best suggestion is to go to Fannie Mae http://www.HomePath.com website. Then access the true cost calculator from the calculator link at the top. The system will give you before-tax and after-tax cost of your loan.

6. How do I cancel my P.M.I.? |Back to top

If your down payment on your existing loan was less than 20% of the purchase price or value, you are paying a "private mortgage insurance premium" as part of your mortgage payment.

These premiums are not tax-deductible. But thanks to the 1998 Homeowners' Protections Act as well as measures instituted by Fannie Mae and Freddie Mac, there are now 2 basic instances where your PMI can be cancelled.

First, if your mortgage is now less than 80% of the current value of the home, you can request that the PMI be cancelled. Usually the loan must be at least 2 years old to request PMI termination.

Second, if your mortgage was originated after July 29, 1999, the lender is required to automatically terminate your PMI when your equity is scheduled to reach 22 percent using the original amortization table for your loan.

Request to terminate PMI premiums must be in ! writing to your lender. Additionally, most lenders will require additional proof of value; such as an appraisal.