Last week, Fannie Mae announced that as of
March 1, 2009, the approval and closing of short sales will not be conditioned on the willingness of the listing firm to alter its fee arrangement with the borrower – as long as the total commission does not exceed 6%. This provision is welcome news to the real estate industry, especially in Michigan, where short sales and foreclosure deals account for a significant percentage of real estate transactions.
Short-sale lenders have been accustomed to the practice of conditional contract approval of closings contingent upon the willingness that the listing firm will drastically lower its own commission. However, as REALTORS® are more than aware, negotiating commissions for short sales is often burdensome and unfair. Getting a short sale to closing requires intensive work over many months, often requiring working with numerous buyers. Fannie Mae’s announcement is an excellent and equitable step forward, considering the integral role those agents play in the short sale process.
It is important to note, however, that Fannie Mae still holds the position that third party approvals (i.e., private mortgage insurers) may still be required and can affect commissions. NAR has asked both Fannie Mae and Freddie Mac to strengthen their policies against reducing short sales commissions, welcomes Fannie’s announcement, and has urged Freddie to follow Fannie’s lead.
For additional information on Fannie Mae’s announcement, please click the link below.
https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0903.pdf
As REALTORS® in uncertain times, searching for solutions to help us in our daily efforts can be a time consuming and trying process. Luckily, our local, state and national associations have been taking the initiative to build programs and provide tools to help us. As your MAR Director, I would like to introduce an exciting program - “Right Tools, Right Now,” brought to you from the National Association of REALTORS®. I had an opportunity to attend a presentation about this program and can personally assure that you will be truly impressed by the wide array of discounted or free products offered in “Right Tools, Right Now.”
Each month NAR will provide a package of benefits for free, or at a reduced cost. Products discounted include educational publications for our buyers and sellers, online training, convention & events, and research and technology tools. Also, in the “Right Tools, Right Now.” program NAR will develop a monthly toolkit. This month’s toolkits include information on FHA, Foreclosure, and Short Sales, which will provide resources to help you with these specific areas of our industry.
Visit the MAR and NAR
Web sites to take advantage of these member only benefits. MAR will send updates as new tools are provided to help keep us on top of our game.
This year’s Broker Summit features nationally renowned industry speakers including Jeremy Conaway, Debra Asher, NAR’s Paul Bishop, and MAR’s Legal Counsels Greg McClelland & Gail Anderson. April 22-23, 2009 marks the seventh annual Broker Summit, the largest broker event in Michigan, which will provide the knowledge, perspective and insight into the issues facing your brokerage in the market today.
The speakers will be presenting knowledge sessions that will provide real solutions to the real challenges that Brokers are facing. Jeremy Conaway is a recognized and leading expert in the field of real estate brokerage, association and MLS design. His session “Building Profitable and Sustainable Brokerages in the New Market” will provide immediate ideas to implement at the office today. Debra Asher will open the Summit as well as present “Recruitment and Retention”.
“Broker Legal Issues” will be presented by MAR’s very own Legal Counsels Greg McClelland & Gail Anderson, and will address the many legalities that Brokers are now facing. This a can’t miss session for Brokers.
Learn more about these speakers, sessions and the variety of networking opportunities that the Summit will offer this year at the Broker Summit
Web site. For only $119 before March 26, you can’t afford to miss this educational opportunity.
Register Today!
With the help of McClelland & Anderson, we are taking the most commonly asked questions from our legal hotline and putting them in e-news. We will be featuring a different question each issue.
QUESTION: I am a REALTOR® representing a seller of a home that is in foreclosure. We are attempting to arrange a short sale. It is my understanding that a seller disclosure statement must be provided despite it being a short sale. Is this true?
ANSWER: YES. There is no exception in the Seller Disclosure Statement Act for short sales.
View legal update videos covering hot topics in the Mirealtors.com Legal Update Center.
WASHINGTON – The Internal Revenue Service announced today that taxpayers who qualify for the first-time homebuyer credit and purchase a home this year before Dec. 1 have a special option available for claiming the tax credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year.
Qualifying taxpayers who buy a home this year before Dec. 1 can get up to $8,000, or $4,000 for married filing separately.
“For first-time homebuyers this year, this special feature can put money in their pockets right now rather than waiting another year to claim the tax credit, “ said IRS Commissioner Doug Shulman. “This important change gives qualifying homebuyers cash they do not have to pay back.”
The IRS has posted a revised version of Form 5405, First-Time Homebuyer Credit on IRS.gov. The revised form incorporates provisions from the American Recovery and Reinvestment Act of 2009. The instructions to the revised Form 5405 provide additional information on who can and cannot claim the credit, income limitations, and repayment of the credit.
This year, qualifying taxpayers who buy a home before Dec. 1, 2009, can claim the credit on either their 2008 or 2009 tax returns. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.
The amount of the credit begins to phase out for taxpayers whose adjusted gross income is more than $75,000, $150,000 for joint filers.
For purposes of the credit, you are considered to be a first-time homebuyer if you, and your spouse if you are married, did not own any other main home during the three-year period ending on the date of purchase.
The IRS also alerted taxpayers that the new law does not affect people who purchased a home after April 8, 2008, and on or before December 31, 2008. For these taxpayers who are claiming the credit on their 2008 tax returns, the maximum credit remains 10 percent of the purchase price, up to $7,500, or $3,750 for married individuals filing separately. In addition, the credit for these 2008 purchases must be repaid in 15 equal installments over 15 years, beginning with the 2010 tax year.
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*See Card Program Details