KYREALTORFall09

Kentucky

REALTOR 速

FALL 2009

A publication of the Kentucky Association of REALTORS速

Managing Online Risk REALTORS速 Safety HVCC Update

www.kar.com

THE 11th ANNUAL EXIT REALTY INTERNATIONAL CONVENTION OVERLAPS THE TIMING OF THE KAR ANNUAL CONVENTION AND EXPO THIS YEAR. REGRETTABLY EXIT MIDSOUTH WILL NOT BE IN ATTENDANCE THIS YEAR FOR THE KAR EXPO. HAVE A GREAT EXPO! WE LOOK FORWARD TO SEEING YOU NEXT YEAR! IF YOU WOULD LIKE TO KNOW MORE ABOUT EXIT REALTY AS AN AGENT OR OWNER, PLEASE CONTACT REGIONAL OFFICE AT 615.523.3133 OR Inquiries@ExitMidSouth.com.

This powerful guest speaker lineup awaits EXIT Realty agents at the Gaylord National Convention Center in Washington, DC. Plus a cash draw of $100,000 or more.

Contents

Volume 2, Number 5, Fall 2009

IN THIS ISSUE Bylaws Changes A publication of the Kentucky Association of REALTORS®

President Jeffrey L. Smith Northern Kentucky Association of REALTORS® President-Elect John W. Smither, GRI Lexington-Bluegrass Association of REALTORS® Treasurer Kevin Farris Heart of Kentucky Association of REALTORS® Treasurer-Elect Ronald E. Hughes, ABR, CRS, GRI Paducah Board of REALTORS® Executive Vice President Susan W. Helm, RCE susiehelm@kar.com Communications/Education Director Hunt Cooper hcooper@kar.com Address letters and inquiries to: Kentucky REALTOR® 161 Prosperous Place, Suite 100 Lexington, KY 40509 TF 800.264.2185 T 859.263.7377 F 859.263.7565 www.kar.com email: hcooper@kar.com KAR members should always send address changes to their local board/association first.

Subscription rates: $10 per year (included in dues) for members, $25 per year for nonmembers.

Kentucky REALTOR® (USPS 024-933) is published quarterly (Fall, Winter, Spring, Summer) by the Kentucky Association of REALTORS®, 161 Prosperous Place, Lexington, KY 40509.

Periodicals postage paid at Lexington, KY. POSTMASTER: Send address changes to Kentucky REALTOR®, 161 Prosperous Place, Suite 100, Lexington, KY 40509.

All articles represent the opinions of the authors and do not necessarily represent the opinions of Kentucky REALTOR® or KAR and should not be construed as a recommendation for any course of action regarding financial, legal or accounting matters by KAR or Kentucky REALTOR® and its authors.

Reproduction prohibited without permission.

Copyright © 2009 Kentucky Association of REALTORS®, Inc. All rights reserved.

4

Managing Online Risk

10

2010 Legislative Session

14

Leadership KAR

17

Convention Education

19

HVCC

20

REGULAR FEATURES President’s Message

5

Tools You Can Use

6

From the Helm

8

REALTOR® Safety

13

KREC Information

18

Local Association News

22

Housing Stats

25

Community Profile

26

Legal Update

28

Up to Code

29

A Day in the Life of...

30

FALL 2009 KENTUCKY REALTOR® 3

KAR News Kentucky REALTOR® Wins Award

Sign Up Online

This past May, at the 2009 Thoroughbred Chapter Public Relations Society of America (PRSA) annual banquet, the Kentucky REALTOR® magazine took home the top honor in the category for “magazine for internal audiences.” The “Win” award was the first entry and first such recognition for the magazine during its illustrious 2 year time frame.

“It is an accomplishment for this publication to be recognized so quickly,” stated Susie Helm, KAR’s EVP. “The goal was create a benefit for our members across the state and this award confirms that we are making strides in the right direction. We already receive great comments from members but this is icing on the cake.”

About the Thoroughbred Chapter PRSA Awards: The Thoroughbred Chapter began an annual awards program in 2002 to honor the outstanding efforts of its members. The awards recognize exceptional work in the categories of media relations, newsletters, magazines, annual reports, brochures, special purpose publications, interactive communications, direct mail/direct response, video programs, PSAs, speeches, feature stories, editorials/OP-ED columns, advertorials, research/evaluation, creative tactics and complete campaigns.

The Kentucky Association of REALTORS® recently revamped the format and delivery method of its monthly newsletter, the Real Estate Report. This monthly update is sent to all Kentucky REALTOR® members who have a valid email address in the system with their local board/association. If you do not receive the newsletter, please check with your local board/association to see if they have your correct email address on file. If you do not receive the newsletter or would like the newsletter to be delivered to another email address, you can sign up online at www.kar.com > Media Center.

KAR Bylaws Amendments This serves as official notice of proposed Bylaws amendments to be voted on by the general membership of the Kentucky Association of REALTORS® at the membership meeting to be held in Louisville, Kentucky on October 1, 2009 immediately following the Delegate Body meeting (see www.kar.com for meeting details.) The following are the substantive changes to the Bylaws for the general membership’s consideration: (Strikethrough indicates item to be deleted. Underline indicates item to be added.)

Change #1 to the Bylaws Revise items as indicated below and add a new item A. Items have been re-lettered as appropriate.

Article VI: Board of Directors Section 9. Qualifications for Director are as follows: A. Being a member in good standing of the Kentucky Association of REALTORS® and B. Having been a delegate, either at-large or local association/board appointed, at least two (2) of the preceding five (5) years; or C. Having served on no less than two (2) KAR committees, work groups, task forces or service areas or other KAR affiliated organizations within the previous five (5) years; or D. Being a member in good standing in their local association/board for not less than two years, and having served 4 www.kar.com

Saving Trees by Going Green If you would like to receive this magazine, the Kentucky REALTOR®, by email (as a link to a pdf) instead of through the mail in hardcopy format, you can unsubscribe by sending an email to hcooper@kar.com.

In addition, past issues of the magazine (in pdf form) are located online at www.kar.com > Media Center > Kentucky REALTOR® Magazine for you to access past articles and information or for distribution to clients and friends.

on no less than two (2) committees, work groups, task forces, service areas or board of directors of their local association/board, and having been selected by their respective region to serve as region director to KAR. a. (Section Added 9/23/04)(Section Revised 11-28-07 to take effect 8-1-03) Change #2 to the Bylaws Revise items as indicated below, and add a new item D and E. Items have been re-lettered as appropriate.

Article VII: Officers Section 2. Qualifications for officer (other than Executive Vice President) are as follows: A. Having a principal office in Kentucky; B. Having been a member of KAR for a minimum of seven (7) five (5) years immediately preceding election; C. Having been a director for two (2) or more of the previous five (5) calendar years; (Revised 9/23/04) D. Having served as a member of no less than two of the following committees: Bylaws, Audit, Strategic Plan, Government Affairs, Legal Action/Risk Reduction, or KREEF Trustee within the previous seven (7) years; E. Having served as a member for at least one (1) year on the Finance Committee within the previous seven (7) years; and F. Not concurrently holding the office of president in any Member Board or Association.

President’s Message Gearing Up for a Great Event

L

ewis came to meet Clark. Will you come and meet me in Louisville?

The convention committee, under the guidance of Linda Gibson Cecil and Karen Bhatt, has done a tremendous job without any direction from yours truly.

Tuesday we will start off with our business meetings at 10am. Come and kick off your shoes as we take five at Fourth Street Live that evening as we will be hanging out with our REALTOR® family at this wonderful downtown attraction full of great restaurants and entertainment venues for all shapes and sizes.

The Convention will be hosting a trade show grand opening on Wednesday evening with tons of great entertainment at the Field of Bling RPAC fundraiser including food, drink and music by The Rumors. Then join us Thursday when we will install your 89th President John Smither from Lexington along with the rest of your officers and directors.

Or you can come only for the speakers and education – that alone is well worth the price of admission. We have two days worth of courses and how about this list of instructors – David Knox, Pat Zaby, Doug Devitre, Charles Cease, Charles Hinckley and Joyce Sterling. We will also have other short educational sessions on topics like HVCC, financing option through KHC and optimizing your website. In addition, if you are looking for a designation course, try out Pat Zaby and his Marketing with Microsoft course. It’s approved for 3 hours of CE along with CRS and GRI elective credit and group discounts are available. Check out the Convention page for all the details – you will be impressed.

Want to attend a KREC Meeting and find out how new regulations may affect the industry (i.e. you)?

Come and meet your Real Estate Commissioners on Wednesday afternoon.

On another note, I have enjoyed being your 2009 president but these past weeks have been quite a challenge with spending two days with LeadershipKAR in Lexington, two days in Frankfort at the Mortgage Bankers Association of Kentucky and back to Lexington for the 2010 budget meeting with the committee. Gotta make sure we keep the finances in check. Which brings me to another point. If you are interested in serving on a committee for KAR in 2010, fill out a committee selection form (online at

www.kar.com > Members > Committees). The appointment process will begin soon after the conclusion of the Convention.

The past several weeks have also had me serve on the janitorial staff at KAR (don’t ask), be present for the bill signing of the $5,000 new home tax credit (see page 14) and another visit to the Capitol for the “Homes for Everyone” calendar project.

I also attended the retirement luncheon of Norman Brown Executive Director of the Kentucky Real Estate Commission in Louisville. Norman is retiring after eleven wonderful years of service. Norman, we thank you for your integrity, commitment, dedication and understanding of the real estate business in the Commonwealth. I speak for over 10,000 REALTORS® of this Association and the wonderful staff you built over the years to say you will be truly missed and we wish you the very best.

Now let’s all go out and list and/or sell a house this week and help this Kentucky market continue to improve.

See you at the Convention!!!!

Jeff Smith 2009 KAR President

FALL 2009 KENTUCKY REALTOR® 5

Tools You Can Use Marketing Minute 360° Panoramic Views http://www.giroptic.com http://www.0-360.com In today’s real estate environment, consumers want photos. Not just any photo, but high quality, “show me the goods” snapshots. With virtual tours and 360 degree photos and videos, you can give potential buyers what they want. There are several do-it-yourself equipment options on the market including 360 degree cameras and lenses. Each tout features that require little or no experience and ease of use with just one click. And, you won’t have to “stitch” photos together ever again, giving you more time to focus on other aspects of your business. Check out these two options: Giroptic claims to be the world's first one-shot 360° panoramic digital camera and it looks impressive. The system helps real estate professionals by allowing the creation of full-motion interactive virtual tours of properties with just one click – using either photos or video. The Giroptic is simple, fast and uses a high definition 360° digital camera to capture the image of an entire room in a single shot. You then simply upload the image to their website and your interactive visual tour is automatically extracted from the initial shot and posted. You can share it with anybody on the web or download it on your laptop to share offline.

With the 0-360, you can capture an entire panorama (115 x 360 degree field of view) with one photo. The 0-360 Panoramic Optic says it has the highest field of view of any one-shot virtual tour lens system on the market. And the free software makes it easy to publish your image as a virtual tour on your website.

6 www.kar.com

Google Real Estate maps.google.com/realestate Google does it again. The most current move in real estate by the “king of the online world” is real estate search. By visiting maps.google.com/realestate, you will find it easier to locate the real estate information you are looking for and have it returned in a useful way.

Enhancements include the addition of markers that will show not only the ten most relevant listings with pins on the map, but also show a small circle on every other listing in that area using the search results layer, so you can get a really good idea of the distribution of properties for sale. You can click on each marker and each small circle to get more detailed information about the property. Google also added the address of a property to the headline of a listing rather than the number of beds and bathrooms as was previously the case.

If you enter a query on Google Maps, you'll see that it’s easy for you to see all your results on a map with a one-box that will take you to real estate listings.

Previously, you had to specify "real estate" from the search options menu, but now Google is making it easier to find available listings

Flickr www.flickr.com Flickr, by definition according to Wikipedia, is an image and video hosting website, web services suite, and online community platform. In addition to being a popular website for users to share personal photographs, Flickr is widely used by bloggers as a photo repository.

As of June 2009, the site claims to host more than 3.6 billion images.

With so many features and images, the site is a great way to promote yourself and your business if you incorporate it into your marketing mix the right way.

How, you might ask? Flickr helps increase your Search Engine Optimization (SEO). It does this by allowing search engines, especially Google, to find your titled and tagged photos and videos quickly. The words used with your content become searchable by consumers and potential clients.

To get started, visit Flickr and set up an account.

Customize your account as much as possible so people can search and find you. Make sure you include key words in your bio, like the towns you service, the type of real estate you specialize in and what you have a passion about. Once you set up your account, you can upload your content and explore other ways to use the service.

NAR Offers Free Webinars http://www.realtor.org/rmohome/webinars REALTOR® magazine is hosting sessions throughout the year to help you succeed in real estate.

Topics vary but are extremely timely to current industry issues. These “quick hit” webinars, offered about once a month, average about one hour in length and are easy to access. Sign up for upcoming webinars or download past recordings by visiting the website.

Past webinars include: • Use Social Media to Get Results • Out-of-the-Box Loans: Who's Buying Today?

• Getting Started in Social Media • Mortgage Finance: What's Really Available Today • Short Sales: Finding Income in a Tough Market - Part 2 • Build Your Business Using the Improved Home Buyer Tax Credit • Short Sales: Finding Income in a Tough Market Upcoming webinars will be: • Managing in Turbulent Times • Get the Facts About Lease-to-Own Deals

Apture Apture is a service that allows you to link and incorporate multimedia features into a layer above your blog or website pages. The program provides a communication platform that allows people to intuitively experience the web by quickly and easily turning flat pages of text into a compelling multimedia experience, basically creating a thumbnail web page, or pop-up, over a regular web page. It does this with just one line of code embedded into the page.

Visitors can then access these items without ever leaving the original page, providing them with what has been described as “a deeper and more meaningful web experience.” It works like this - whenever a reader moves his/her mouse over an Apture-linked term, a box is displayed on the page showing the related media you chose. Whenever a reader clicks on an item in the box, a new window opens, displaying the source of that media.

It's a great way to add more value to your blog posts and web experience.

Bits and Bytes

Google Voice www.google.com/voice There is a plethora of ways to reach someone nowadays. Through email, websites, blogs, social networks, fax, phone (land line, cell and VoIP) and even old reliable, the post office.

How about having one number that works anywhere, anytime and can be configured so that some people go to voicemail, others to your mobile phone and a select few to all of your telephone numbers? And it will be your number forever. And it’s from Google so it won’t cost you a dime. Introducing Google Voice, an application that helps you better manage your voice communications. Currently, the feature is available by invite only but the features are truly impressive: • • • • • • • • • • • • • • • • • •

Call screening – Announce and screen callers Listen in – Listen before taking a call Block calls – Keep unwanted callers at bay SMS – Send, receive, and store SMS Place calls – Call US numbers for free Taking calls – Answer on any of your phones Phone routing – Phones ring based on who calls Forwarding phones – Add phones and decide which ring Voicemail transcripts – Read what your voicemail says Listen to voicemail – Check online or from your phone Notifications – Receive voicemails via email or SMS Personalize greeting – Vary greetings by caller Share voicemail – Forward or download voicemails Conference calling – Join people into a single call Call record – Record calls and store them online Call switch – Switch phones during a call Mobile site – View your inbox from your mobile GOOG-411 – Check directory assistance

Check out more at www.google.com/voice or search for Google Voice on Wikipedia.

FALL 2009 KENTUCKY REALTOR® 7

From the Helm Five Traits of Great Leaders

by Susan W. Helm

W

hat are the traits of a great leader? The question has been asked for centuries. Whether they were leaders in government, combat, business, education or society in general, what were the traits that made George Washington, Abraham Lincoln, Franklin Roosevelt and Ronald Reagan great Presidents? What made Robert E. Lee and Dwight Eisenhower great military leaders? What made people like Henry Ford and Bill Gates great business leaders? And, what made Martin Luther King, Jr. and Mahatma Gandhi great leaders in championing societal change?

The one common thread is their ability to inspire people to work for the greater good and benefit of their organization or cause. To reach higher than they thought they could to reach their goals. Inspirational leadership can take many forms but I want to discuss five traits of successful inspirational leadership discussed in a recent REALTOR® magazine article.

The first trait of a successful inspirational leader is selfless leadership.

A selfless leader is one who gives of himself to benefit the larger portion of their organization’s membership.

As the first leader in the American civil rights movement, Martin Luther King Jr. would be at the front of marches selflessly guiding his membership’s cause for nonviolent participation in promoting civil rights. He would also give himself as the civil rights movement’s spokesperson and speak positively and forcefully of the need for change in this country to promote equal rights for all Americans. In our industry, there are many examples of selfless leadership. They are the ones who put the members first. They find ways to remove impediments to success and implement change for the benefit of all members.

They also give of themselves to work tirelessly as spokesperson for the real estate industry. A selfless leader also is one not afraid to tap the collective wisdom of volunteers whose input can be invaluable to the success of the organization. A selfless leader is also one who is not afraid to learn to gain even greater

8 www.kar.com

knowledge to benefit the organization. President John F. Kennedy once said “Leadership and learning are indispensable to each other.” Realizing the need for more knowledge benefits the entire organization.

The second trait of a successful inspirational leader is courage and optimism.

In challenging times every group needs a “cheerleader” and advocate to stress the strengths of their industry even in tough times. During the depths of the Great Depression President Franklin Roosevelt tried to inspire optimism in all Americans when he said “the only thing we have to fear is fear itself.” He said that if we remain optimistic and courageous we can weather tough times. During the tough economic times we experience today a great leader should demonstrate optimism and stress the positives going on in the industry. But while being optimistic a great leader should also remain realistic of the current economic times and to always tell their members the truth. If you remain optimistic about the strengths of the industry while telling the truth and not deny economic realities you can inspire people to be successful in difficult times. A leader should also have the courage to inspire people by continually giving them all the tools and services they need to be successful in their business.

The third trait of a great inspirational leader is to be action-oriented.

There is an old saying that if you are going to “talk the talk you should walk the walk.” A great leader should not be afraid to back up their talk with action even when it means taking a risk that could benefit the entire organization. One of the great military leaders in American History, Robert E. Lee

was not afraid to take a risk if success meant victory. At the battle of Chancellorsville Lee’s Army of Northern Virginia was badly outmanned by superior Union forces.

So Lee knew his best chance for victory was to take a risk. He implemented the unprecedented tactic of splitting his army in the face of a superior force. He delegated Stonewall Jackson’s Corps to do a nighttime flank march around the Union Army and surprise the Union Army with an attack at dawn the next morning.

The risk worked perfectly as Jackson’s forces pulled the surprise attack and helped Lee’s army win the battle. This further endeared Lee to his men as they knew he was not afraid to take a risk if it meant a good chance of victory if it succeeded. Successful leaders in the real estate industry today need to take appropriate action when necessary and not be afraid to take risks if it means success for the organization as a whole. Taking action in outreach to other organizations, community groups and government agencies can have a positive impact on furthering the mission and goals of their organization. Also, great leaders should not be afraid to “think outside the box” and take risks when appropriate for the betterment of their organization. Among those risks is delegating to people and allowing them to have a voice and control in the success of the organization.

The fourth trait of a great inspirational leader is a passion for people.

Or more so, the passion for helping people in need. Mother Theresa was a great example of a leader who inspired people through her work for the disadvantaged all over the world.

Successful leaders should have what is termed a “sense of altruistic urgency.”

Wikimedia-Commons When they see something that needs to User Túrelio be done they should be instrumental in leading and recruiting others to get involved. During these different economic times, leading the way to help other members in financial need is very important. It is also important to listen to members with their problems and attempt to help. General Colin Powell once said “The day soldiers stop bringing you their problems is the day you have stopped leading them. They have either lost confidence that you can help them or concluded that you do not care. Either case is a failure of leadership.” Great leaders also know people are their greatest resource and to treat them courteously and empower them with the knowledge and tools to be successful will endear you as a leader.

The fifth trait of a great leader is to inspire by example.

Taking the lead and setting the example for others to follow is a key component of a great leader. The quarterback of a football team is the leader of his team. He wants his teammates to follow him. But he leads by example by staying in the pocket against a withering pass rush and throwing the pass that could win the game. Colts Quarterback Peyton Manning inspires his team mates to work for the win by plugging away, like he does, every time: "We stuck to our plan and it worked. We just had to keep plugging and plugging …" The great leaders in our industry are not facing onrushing lineman with the intent of dishing out physical pain but they can lead by example all the same. Being at community events, RPAC fundraisers and legislative meetings shows your interest in being a leader by getting and staying involved and demonstrating your passion for the organization to others to set a good example for others to follow.

A great leader needs to be able to inspire people in their organization to attain their mission and goals through selfless leadership, courage and optimism, being action oriented and not afraid to take risks, a passion for people and inspiring by example.

I leave you with one last quote on great leadership by Lao Tzu, a Chinese Taoist Philosopher. He said “A leader is best when people barely know he exists, when his work is done, his aim fulfilled, they will say we did it ourselves.” What a testament to great leadership through the inspiration and empowerment of others to achieve their goals.

Susan W. Helm, RCE

Susan W. Helm is the Executive Vice President of the Kentucky Association of REALTORS®

FALL 2009 KENTUCKY REALTOR® 9

Feature Story

Managing Online Risk: Your Reputation is at Stake

By Amy Chorew

I

t’s 10 o’clock Monday morning – do you know where your company’s reputation is?

As sites like LinkedIn, Twitter and Facebook become intertwined with business uses, real estate companies need to establish guidelines and best practices to manage their online risk.

Whether we want to admit it or not, companies are learning that social networking, when used properly, can be an effective business tool. We know by experience that having your sales associates involved in the community can enhance your company’s reputation and bring in more business. We are now embracing the concept that our sales associates who blog, tweet and participate in forums and social sites can also increase business – so long as it’s done right.

First, let’s define what we are talking about. The definition of Web 2.0, according to Wikipedia, is this: "Web 2.0" refers to the second generation of web development and web design that facilitates information sharing and collaboration on the World Wide Web. The advent of Web 2.0 led to the development and evolution of web-based communities, hosted services, and web applications. Examples include social-networking sites, video-sharing sites, wikis, blogs, mashups and folksonomies.

Although the term suggests a new version of the World Wide Web, it does not refer to an update to any technical specifications, but rather to cumulative changes in the ways software developers and end-users utilize the Web. It is not software or hardware, but the ability for anyone to create content on the web to communicate with their niche. You can become a friend who recommends products and services that solve problems.

Some of the tools that can help you provide this information depends on your adaptability to technology and your willingness to use them. Web 1.0 websites are static where changes are only made occasionally and where the consumer has little opportunity to engage, ask questions or interact. Web 2.0 websites are blogs and sites like Facebook and Trulia. Consumers can set up

10 www.kar.com

their own account on these sites and within minutes start communicating with their sphere. The consumer demands more interaction with companies from which they purchase products. They want to comment, ask questions and have a conversation online. Don’t you?

But how do you monitor the conversation? You need a social media policy that explicitly lays out what is and isn’t permissible, both within the company’s network and externally if sales associates are presenting themselves as representatives of the company.

If you do decide to take the “easy” way out and just block social networking sites with the company firewall, remember that what people post from home can still affect your company’s reputation.

How to get started Consider creating a task force with people in your company who understand policy and procedures and others who are responsibly using social media. Together they can create a company platform. As always, before you can develop a policy, you need to define the company’s overall attitude toward social networking. A well executed social media strategy helps consumers and licensees follow an online dialogue protocol that shows promise of a successful outcome for consumers in real estate transactions. Create a statement that reflects the company’s mission statement and commitment to the consumer.

The social media policy has a lot of areas to cover.

Social media covers all of the following topics:

Logos and company names – who has the authority to start an online group using a registered trade name?

• • • • • • • • • •

There are numerous groups appearing on social networks using registered trademarks to name groups.

Who is allowed to start a group? If there is a group with your company name, make sure the principal broker is aware, approves, has administrative rights and authority to manage the group online. Who makes the decision to limit a group's membership or open it to the public?

Make sure you create a company policy dealing with logos and company names.

Blogs Podcasts Video Social Networks Mapping Real Estate Search Engines and Aggregators Real Estate Communities Instant Communication Syndication Reviews

Do you know what your agents are doing on the web?

Review data and information delivery in property listings (real estate search engines), blogs (real estate communities) and question-and-answer platforms (reviews). Set up a task force to monitor specific sites.

You will want to create a form that all sales associates fill out with a list of sites that they are participating on along with the web address. In turn, you should prepare a list to share with your sales associates so they can market to the consumer all the sites where they can find your company. Make sure to run in house training sessions on the dos and don’ts of posting on these sites.

Remember to cite good examples and examples that can get someone in trouble.

Do you know where your agents are placing their listings and what other listings they are claiming?

Outline property listing syndication methods and systems for updating listings and keeping them current on all platforms. The best practice is to implement a company wise distribution making it easy for everyone to maintain consistency. Some MLS systems will do this for you as well. Again, create a list of all the sites that you as a company submit listings to so your agents can include in their marketing plans.

Copyright dos and dont’s Copyright law applies to articles written by other authors, photographs and images, videos, and music.

Avoid severe financial consequences that follow unauthorized use of another person's intellectual property. Review copyright and creative commons laws and host in house training. Visit www.copyright.gov and www.creativecommons.org for more information.

Q & A platforms – are they generating leads in the discussion thread, or are you putting your real estate license at risk?

Sites like Trulia Voices are a great way to answer questions and generate leads. Last time counted, there were over 85,000 questions asked by consumers on Trulia. Make it very clear to your sales associates what can and cannot be answered on these sites, even if they are authentic consumer questions. Make it a practice to review answers that other agents have posted on these sites and point out correct and incorrect use. We see a lot of fair housing and advertising law violations and agents answering questions from consumers in other states. On sites like Trulia, you can set up a search for every town your represent and have them delivered by email. You can then watch when questions are asked and follow the answers.

Some sites to visit: http://www.trulia.com/voices/ http://answers.yahoo.com/ http://www.zillow.com/advice/ http://www.realtown.com

Social media tools to monitor and maintain reputation management controls Educate agents in the correct use of tools to avoid problems and pitfalls and ways to engage consumers in a fashion that will BUILD and ENHANCE a company's reputation online. Remember to always reward responsible interaction on line. If you can show examples of online fires doused as well as positive examples of building reputation online, your sales associates will be better informed.

(Continued on page 12)

FALL 2009 KENTUCKY REALTOR® 11

Feature Story Consider hiring a social media director for your association or your company As we know, reputation is a key factor in choosing a REALTOR®. The two reasons cited for choosing a REALTOR® in the 2008 NAR Home Buyers and Sellers Survey center around reputation. The first is the agent’s honesty and trustworthiness followed by overall reputation. It makes sense for REALTORS® to figure out a way to share these important elements with consumers any way they can. Over time, social media sites will only continue to grow. Consumers are looking for better ways to choose their REALTOR® other than just referrals. They are looking online for objective feedback to verify the level of quality service they will receive when they buy or sell a home. We want to keep our reputations outstanding online.

Brokers and agents need to learn how to use tools to MONITOR their online presence Google or Yahoo Alerts are a good way to start. Set up alerts based on your companies name, principal’s names, etc. These alerts will send you an email every time one of your search words is found by search engines. http://www.google.com/alerts http://alerts.yahoo.com/

Twitter Search http://search.twitter.com http://www.twilert.com

StepRep Field Guides available through NAR:

http://myfrontsteps.com

Social Networking http://www.realtor.org/library/library/fg125 Blogging http://www.realtor.org/library/library/fg910 Online Marketing http://www.realtor.org/library/library/fg203 Test your social networking IQ with a quiz: http://www.realtor.org/RMOQuiz2.nsf/Social Networking?OpenForm

Yelp http://www.yelp.com

Here are some other reputation management tools to look at. They charge a fee but will do the time consuming work for you.

Privacy Gurus http://www.privacygurus.com/firm.php

Quality Service Certified Amy Chorew is a national real estate trainer highly experienced at helping managers and agents maximize the infinite opportunities that technology offers them. Her knowledge of the industry and the latest technologies available along with her unique ability to translate it all into easy to understand language allows students to learn in a stress free and enjoyable environment.Visit her blog at www.amychorew.com and sign up for her free e-newsletter and check out her website at www.techbyte.com

12 www.kar.com

http://www.qualityservice.org

Incredible Agents http://www.incredibleagents.com

Real Estate Ratingz http://www.realestateratingz.com

REALTOR® Safety Calling All Cars: How to Safely Use a Cell Phone Behind the Wheel

When it comes to cell phone safety, the best tip of all is: Don’t make or accept cell phone calls while you’re driving. This has been proven to be a distraction and, in fact, many states and cities have laws prohibiting using a cell phone while driving.

But if you must, and are legally permitted to, use your phone while driving, follow this advice for best safety practices: 1. Keep your hands on the wheel, not on your phone.

2. Keep your eyes on the road. Learn how to operate your phone without looking at it. Memorize the location of all the controls, so you can press the buttons you need without ever taking your eyes off the road.

3. Practice off-road. If your phone is new, practice using it – including the voice mail system – before you use it while driving.

7. Never dial while driving. If you must dial manually, do so only when stopped. Pull off the road, or have a passenger dial for you.

8. Take a message. Let your voice mail pick up your calls in tricky driving situations. It's easy to retrieve your messages later on.

9. Know when to stop talking. Keep phone conversations brief so you can concentrate on your driving. If a long discussion is required, if the topic is stressful or emotional, or if driving becomes hazardous, end your call and continue when you're not in traffic.

10. Know when to pull over. If you need to make a call or answer an incoming call that requires your attention, stop driving. Pull over in a safe and convenient location before taking your eyes off the road.

4. Use a hands-free unit. A hands-free unit lets you keep both hands on the wheel while you talk on the phone. Attach the microphone to the visor just above your line of vision, so you can keep your eyes on the road.

11. Keep the phone in its holder. Make sure your phone is securely in its holder when you’re not using it.

5. Stay in your lane. Don't get so wrapped up in a conversation that you drift into the other lane. Pull into the right-hand lane while talking, so you only have to worry about traffic to the left.

(Sources: Canada Safety Council; the Washington Post; Spybusters.com)

6. Use speed dialing. Program frequently called numbers and your local emergency number into the speed dial feature of your phone for easy, one-touch dialing. When available, use auto answer or voiceactivated dialing.

12. Don't take notes while driving. If you need to jot something down, pull off the road.

For more safety advice and related information from NAR, visit www.realtor.org/safety or check out the REALTOR® Safety Field Guide at www.realtor.org/library/library/fg201.

FALL 2009 KENTUCKY REALTOR® 13

Government Affairs

by Anetha Dunn Sanford, Governmental Affairs Director

Sneak Peak: Issues for the Upcoming 2010 Legislative Session

Appraisal Management Company (AMC) Legislation

As you might imagine, keeping abreast of the important and relevant political developments in Kentucky is a significant and continuous task. Here are a few matters currently being discussed for the 2010 legislative session:

The Kentucky Real Estate Appraisers Board will be introducing legislation that would regulate AMC’s.

NAR’s Board of Directors adopted policy that supports the regulation of AMC’s, primarily through FIRREA and the existing regulatory infrastructure. NAR President Charles McMillan hinted at such a policy in March when he testified before the House Financial Services Subcommittee on appraiser independence.

NAR’s rationale is AMC’s are not currently regulated at the federal level and regulation at the state level varies.

Regulation would ensure AMC’s operate within the same basic guidelines and standards as independent appraisers. This allows AMC’s to be regulated within the existing appraisal regulatory structure, which avoids the need to create additional levels of government bureaucracy. KAR’s Governmental Affairs Committee will be reviewing the proposed legislation closely to be sure you, the REALTOR®, will be protected in this process.

This is a Budget Year!

The unparalleled state of fiscal problems has been brought on by the worst decline in tax receipts in decades and there is no sign of this letting up. Kentucky is trying to close the shortfall they face with a combination of federal stimulus dollars, revenue increases and funds from reserves.

The Kentucky General Assembly did hear legislation on alcohol and cigarette tax as well as legalizing slots at horse tracks. The alcohol and cigarette tax passed the general assembly but slots at the horse tracks did not although it’s probably not going away. Kentucky, as well as other states, will continue to struggle to find the revenue needed for the next few years.

Kentucky’s $5,000 New Home Tax Credit

Tax on Services A tax on services bill was introduced during the 2009 legislative session and there is a possibility this bill may be reintroduced with added services to be taxed.

Members of KAR’s Quick Response Team & LBAR’s Governmental Affairs Committee met with Representative Bill Farmer to gather information regarding this proposed legislation. The intent is to repeal the state income tax and levy service taxes including real estate transactions and commercial rents (there are a few exemptions). Fortunately, the bill did not gain any traction during the June 2009 special session. Farmer suggested that in order for the bill to move, there would need to be another special session no later than November 2009 in order for the legislature to act on tax reform prior to the 2010 budget session, adding that you can’t logistically do both in the same session. This subject is very high on KAR’s watch list.

14 www.kar.com

This past July, Representative Tommy Thompson, Glen Perkins, president of the Home Builders Association of Kentucky, Kentucky Governor Steve Beshear and Jeff Smith, president of the Kentucky Association of REALTORS® sign into law Kentucky’s $5,000 New Home Tax Credit.

The Kentucky General Assembly passed legislation that gives first-time home buyers up to a $5000 tax credit for new homes purchased as a primary residence.

The tax credit is provided July 26, 2009 through July 25, 2010. See the how-to’s below:

Does Your Buyer Qualify?

A Buyer Can Claim the Credit if All of the Following Apply: • Your qualified principal residence is a single family dwelling; • Your qualified residence is purchased to be the principal residence of the qualified buyer(s) for a minimum of two (2) years; • You purchase a new home after July 25, 2009 and before July 26, 2010; and, • You meet qualifications and receive approval from the Department of Revenue.

A Buyer Cannot Claim the Credit if: • Your application is not received via FAX within seven (7) calendar days from the purchase date. Any application submitted via mail will be denied.

• Your new residence has been previously occupied.

• Your application is received after the New Home Tax Credit cap has been reached.

• You are eligible for first time homebuyer credit under Section 36 of Internal Revenue Code.

How to Apply To Apply For the Credit: • Submit a Kentucky Form 40A103 Application for New Home Tax Credit application via fax within seven (7) calendar days of the escrow closing between the buyer and the seller.

• Kentucky Form 40A103 may be accessed by visiting the Department of Revenue via http://revenue.ky.gov • FAX to the Department of Revenue at (502) 564-3706 The Department of Revenue will notify taxpayers in writing if their application has been approved or denied.

Using the Credit Approved Buyers • Qualified buyer(s) approved for the credit will receive a credit allocation letter with a four (4) digit approval code from the Department of Revenue.

This letter must be attached to the income tax return filed for the taxable year during which the qualified principal residence was purchased.

• Electronic filers: Information from the credit

allocation letter and the New Home Tax Credit Worksheet D (for electronic filers only) must be included with any electronic return submitted.

Make sure the software used to submit the return can meet these requirements.

Use of Credit Against Tax Liability • Credit is claimed on page 1 of your Kentucky tax return.

• Approved credit, up to $5000, applies to Kentucky tax liability, after applying any allowable credit for Family Size Tax Credit, Education Tuition Tax Credit, and Child and Dependent Care Credit. For example, if your Kentucky tax liability, after allowable credits, is $7000, then you would be allowed the full $5000 credit and only owe the remaining $2000.

New Home Tax Credit is Nonrefundable • A nonrefundable credit means that any unused portion will not be refunded and may not be carried back or forward to another tax year. For example, if your Kentucky tax liability, after allowable credits, is $2000, then your credit would be limited to the $2000 liability and the remaining amount lost.

For more information, visit revenue.ky.gov.

Revised Truth in Lending Disclosure Requirements Lenders will be subject to new disclosure requirements for mortgage loans under the Federal Reserve Board Truth in Lending Regulation (Reg Z).

The new requirements apply to loan applications filed on or after July 30, 2009.

The new rules are complex and compliance will be a challenge for lenders. REALTORS® will want to learn the basics so they can advise clients of potential delays and the new procedures.

Here are key highlights of the changes: • The new requirements apply to all mortgages secured by a borrower's home, including primary and second homes and refinancings. Investor loans continue to be exempt.

• Lenders must give good faith estimates of mortgage loan costs within 3 business days after the consumer

FALL 2009 KENTUCKY REALTOR® 15

Government Affairs applies for a loan (early disclosure). The lender may not collect any fees before the disclosure is provided, except for a reasonable fee for obtaining a credit report.

• The closing may not take place until expiration of a 7 day waiting period after the consumer receives the early disclosure.

• If the annual percentage rate (APR) increases by more than 0.125 percent, the lender must provide a corrected disclosure to the borrower and wait an additional 3 business days before closing the loan.

The APR includes not only the interest rate on the loan but certain other costs related to settlement, so it will be important for any fees that affect the APR to be as accurate as possible, as early as possible, to minimize the need for a corrected TILA disclosure.

• The consumer may modify or waive both waiting periods for a documented personal financial emergency, but must receive the disclosures no later than the time of the modification or waiver.

Mortgage Credit Certificate (MCC) This 25 percent credit means additional take-home pay, making your buyer’s mortgage more affordable!

What is a Mortgage Credit Certificate?

A Mortgage Credit Certificate (MCC) from Kentucky Housing Corporation (KHC) reduces the amount of federal income tax a buyer pays, giving the buyer more available income to qualify for a mortgage loan. MCCs are NOT mortgages. They are tax credits that put extra cash in the buyer’s pocket each month, so they can more easily afford a house payment. That means fewer tax dollars will be withheld from their regular paycheck, increasing their take-home pay. The federal government allows every homeowner an income tax deduction for all the interest paid each year on a mortgage loan. But an MCC gives a tax credit of 25 percent (not to exceed $2,000). A buyer can still deduct the remaining 75 percent interest on your income taxes.

A tax credit is not the same as a tax deduction. A tax deduction reduces the portion of your income that is taxed, so you pay less. A tax credit is a direct, dollar for dollar reduction in the total tax you owe. The MCC is effective for the life of the loan as long as the buyer lives in the home. If the home is sold in the first nine years of ownership, the owner may be subject to Federal Recapture Tax.

16 www.kar.com

Who Can Apply?

A buyer may qualify for the program if: • They are purchasing their first home.

• They have not owned a home in the last three years.

• The home is located in an area of the state which is exempt from the first-time home buyer rule. (Your local lender can determine those “targeted areas.”)

• Maximum home sales price is $258,000.

• Maximum income limits: o 1-2 person household: $52,800-$83,040 o 3-4 person household: $60,720-$96,880 KHC, FHA, VA, RHS, Fannie Mae, and/or Freddie Mac standards for creditworthiness must be met and the buyer must occupy the property. It cannot be used for business, commercial, or rental purposes. Applicants need a sales contract with a legal description of the property, a $500 MCC fee, and copies of federal income tax returns for the past three years.

How to Apply?

Applications are accepted on a first-come, first-served basis by a statewide network of local lenders. MCCs are available with FHA, VA, RHS, Fannie Mae, and Freddie Mac Conventional 30-year mortgages at a fixed-rate.

MCCs cannot be used with KHC’s Mortgage Revenue Bond program, but may be used with KHC’s Fannie Mae Cash Window program. A local lender will submit the loan application and notify you as to whether the application has been accepted.

For MCC approved lenders and for more information, visit KHC’s website at www.kyhousing.org or call toll-free in Kentucky at (800) 633-8896 or (502) 564-7630, extension 291.

RPAC has raised $90,972 as of July 31. Our goal for 2009 is $159,270. This is 57 percent of goal with a deadline of October 30.

Upcoming fundraisers across the state: • September 30, 2009: Field of Bling at Convention – take a chance at winning a 1 carat loose diamond. $50 per jar and you don’t have to be present to win.

• October 9, 2009: RPAC Statewide Coordinated Phone-athon – from 10:00am to 2:00pm EST, this event will help raise as much money for RPAC as possible in the time allotted. All offices and boards with the KAR Regions will compete to see which Region can raise the most contributions for RPAC!

Leadership KAR LeadershipKAR: Growing the Leaders of Tomorrow

Would you like to join the ranks of some of the most successful REALTORS® from around the state?

You can by becoming part of the LeadershipKAR program, offered by the Kentucky Association of REALTORS® since 2002.

The program allows participants to work together in a training course which combines individual study, group sessions and actual project experience in using leadership skills. Training sessions include identification of leadership skills, team-building exercises, goal setting, personal profile analysis, network building and improving communication skills. In total, there are six (6) sessions – three (3) KAR business meetings and three (3) retreats.

LeadershipKAR is open to all REALTOR® members of KAR, however, a maximum of 15 individuals will be appointed to participate in the program. Participants will be chosen from a crosssection of the profession and will reflect the diversity of the organization. Tuition for the program is $600, however, several of the local boards/associations will cover most, if not all, of this cost. Check with your local board/association for details. KAR also offers a scholarship to cover the cost for one participant.

Objectives of the LeadershipKAR Program are: • To identify Kentucky REALTORS® who have demonstrated leadership potential through job-related and community activities.

• To train participants by developing leadership skills.

• To motivate participants by: - Increasing awareness of real estate and association management issues and challenges.

- Involvement in problem-solving activities on issues of current interest; and - Providing a network of leaders across the state who is actively involved in improving our profession and their local and state Associations.

Please note: attendance at all sessions (retreats and KAR meetings) is mandatory. The dates for all sessions are listed on the application.

Apply now for the 2010 LeadershipKAR program www.kar.com > Education > LeadershipKar

FALL 2009 KENTUCKY REALTOR® 17

KREC Information Mortgage Fraud Issues

By Lee B. Harris

I

n recent years, issues involving mortgage fraud have become rampant in the real estate industry throughout the nation. These schemes have played a huge role in the current foreclosure and mortgage crisis in our nation. Real estate professionals should protect themselves and their clients from falling into a fraudulent lending scheme by becoming aware of the laws and knowing where to turn if a problem arises.

Mortgage fraud can take many forms. There are, among others, dual contracting, phantom second mortgages, false appraisals, incorrect closing statement and deeds. The key to eliminating this problem is educating both consumers and licensees about these types of scams. If a licensee is representing a client, for instance, and that licensee believes that the transaction involves a mortgage fraud situation, there are numerous agencies the licensees and the clients can turn to for advice.

First of all, the Mortgage Broker Licensing Division of the Department of Financial Institutions regularly monitors banks and other financial institutions to ensure compliance with state laws. In addition, the Department of Housing and Urban Development (“HUD�) has numerous programs to educate consumers about home purchases and financial issues. The Attorney General’s Office has a Consumer Protection Division that regulates consumer fraud in this state. Finally, many cities and counties have local complaint processes to advise buyers and sellers about financial decisions and even investigate complaints.

If a real estate licensee is in a situation that is either unlawful or predatory in any way, he or she should seek

18 www.kar.com

advice from the Kentucky Real Estate Commission or one of the above-named agencies. If indeed the company is defrauding a consumer or the government, or both, the real estate licensee should refuse to participate. In addition, the licensee should report the wrongdoer to the appropriate law enforcement agency.

The only way to stamp out these practices, once and for all, is to take action and report them.

The number of Suspicious Activity Reports (SARs) for mortgage fraud tracked by the Federal Bureau of Investigation could skyrocket by nearly 300 percent this year.

Compared to 2007, mortgage fraud SARs in 2008 had already increased by more than 36 percent to over 63,000. In just the first two months of 2009, the FBI had already documented nearly 29,000 mortgage fraud SARs. At that rate, some 174,000 SARs, a 276 percent increase, could be filed by the end of the year.

NAR has a field guide to mortgage fraud on its website.

Check it out at www.realtor.org/library/library/fg330.

Lee B. Harris General Counsel Kentucky Real Estate Commission

Education

Convention Education Schedule If you need a great reason to attend the KAR Convention in Louisville this year, check out these outstanding, and truly beneficial, education programs.

All sessions are open to members with paid registration.

Wednesday, September 30 Negotiating Skills for Tough Situations – David Knox – 3 hours CE Thursday, October 1 Blogging Effectively – Doug Devitre – 3 hrs CE Short Sales – Charles Cease – 3 hrs CE Power Prospecting w/ Social Media – Doug Devitre – 3 hours CE The Savvy Agent – Joyce Sterling – 3 hours CE (law approved) One hour education sessions on Thursday, October 1 include: MCC and Financing – Kentucky Housing Corporation Detoxing Toxic People – Charles Hinckley HVCC – The Good, Bad & Ugly – Panel Discussion Website Optimization – Mission Data Also available for 3 hours CE, CRS and GRI elective credit: Marketing w/ Microsoft Office – Pat Zaby – Thursday, October 1 Separate registration is required and group discounts are available – as low as $75.

Still Need a Core Course?

KAR is holding a last chance Core Course on December 30, 2009 at the Crowne Plaza in Lexington.

The cost is $75. This course not only meets KREC’s Core Course requirement but also provides 6 hours law CE credit. You don’t have to wait until the next to last day of the year – KAR has other courses scheduled and they are only $50. Check www.kar.com for times and dates.

For a copy of all CE courses scheduled for 2009, please visit www.kar.com.

Join KAR on Facebook, LinkedIn, ActiveRain and Twitter Join now and become a member of the KAR groups! If you are not currently on these sites, getting started is easy. Just log on to www.facebook.com, www.twitter.com, www.linkedin.com or www.activerain.com and set up a profile. Joining is free and once you become a member, you can request to be added to the KAR groups. That’s all there is to it.

To locate the KAR groups, use the site’s search feature or go directly to the group: Facebook www.facebook.com/group.php?gid=9244727021 Twitter twitter.com/kyrealtors LinkedIn www.linkedin.com/groups?gid=1323837 ActiveRain activerain.com/groups/kar 2009 GRI Scehdule Sept. 16 Elective: Sales Contracts Bowling Green, KY Oct 29-30 GRI 5: Systems for Success Elizabethtown, KY Nov 5-6 GRI 5: Systems for Success Ashland, KY Nov 11-12 GRI 1: Professionalism in Real Estate Ivel, KY Dec 3 Elective: Understanding RE Investments Bowling Green, KY GRI courses 1 -5 are $149 ($99 early bird when registered at least two weeks in advance). GRI elective courses are $75 ($50 early bird when registered at least two weeks in advance). To find out more about the GRI program and to register for these courses, go to www.kar.com > Education > GRI. Additional GRI courses may be added to the schedule. Check the website for more details.

FALL 2009 KENTUCKY REALTOR® 19

Appraisal Issues

Home Valuation Code of Conduct (HVCC): Navigating the New Landscape

T

he Home Valuation Code of Conduct (HVCC) establishes standards for solicitation, selection, compensation, conflicts of interest and appraiser independence. It became effective May 1, 2009, for any mortgage that will be sold to Fannie Mae or Freddie Mac. Federal Housing Administration (FHA) and Federal Home Loan Bank (FHLB) mortgages are not covered in the agreement.

Mortgage brokers and real estate agents are prohibited from selecting appraisers. Lenders are permitted to use “in house” staff appraisers to conduct appraisals. However, the loan production staff is prohibited from (1) selecting, retaining, recommending, or influencing the selection of an appraiser for an appraisal assignment or for inclusion on an appraisal roster and (2) having any substantive conversation with an appraiser or appraisal management company regarding valuation, including ordering or managing an appraisal assignment.

The requirements are having a significant impact on appraisal practices as lenders must now comply with the new requirements of the Code in order to sell their mortgages to the government-sponsored enterprises (GSPs).

Below are some frequently asked questions from NAR to help our members navigate this new appraisal landscape.

Does this agreement concern only mortgages in New York State?

No, this agreement applies to mortgages across the country. Starting May 1, 2009, the GSEs will not purchase single-family loans from mortgage originators in any state that do not agree to adopt the Code.

20 www.kar.com

Does this agreement apply to all lenders?

Lenders not selling their loans to Fannie Mae or Freddie Mac are not obligated to adhere to the HVCC. GSEs may exclude lenders that meet the definition of “small bank” according to 12 USC§ 2908 and which the GSE determines would suffer hardships from provisions of the HVCC. However, excluded lenders must otherwise comply with the other provisions of the Code and meet appropriate standards of appraiser independence.

Who is responsible for applying the HVCC? The GSEs apply the new code to lenders selling mortgages on the secondary mortgage market.

What does this agreement mean for the independent appraiser?

Independent appraisers, appraisal companies, and appraisers managed by lenders or settlement companies must continue to meet appropriate standards of appraiser independence, including following Uniform Standards of Professional Appraisal Practice (USPAP) and maintaining relevant state licenses or certifications.

What does this agreement mean for REALTORS®?

Individual REALTORS® and licensed real estate agents cannot serve as a third party between a lender and appraiser. This includes selection, retention, and compensation of an appraiser.

Broker REALTORS® that offer services as a lender or affiliated lender and appraiser services must comply fully with the HVCC if there is an expectation that their loans will be purchased by Fannie Mae or Freddie Mac after May 1, 2009.

Is this agreement federal law?

No. This is an agreement signed by two governmentsponsored corporations, Fannie Mae and Freddie Mac, and the New York State Attorney General, Andrew Cuomo. The federal regulator of Fannie Mae and Freddie Mac, the Federal Housing Finance Agency (FHFA) also signed the agreement. No legislation was passed or signed into law with respect to this agreement.

Are real estate agents prohibited from communicating with appraisers?

No. A third party, including REALTORSÂŽ and real estate agents, can still ask appraisers for additional information, provide additional information to an appraiser, or ask for corrections of factual errors.

Are lenders required to work only through appraisal management companies?

No, lenders may order appraisals directly from an individual appraiser. Lenders that utilize in-house appraisers can still order appraisals as long as they are independent of the loan production staff and do not ultimately report to an officer who manages loan production.

Can appraisals be adjusted by in-house appraisal staff during an appraisal review or quality control process?

Yes, the HVCC does not prohibit in-house appraisers from adjusting an appraisal during the review process.

In fact, the Code does not prohibit a lender’s due diligence in originating a loan.

Does the Code apply to all mortgages?

No, the code applies only to 1-4 unit single-family loans sold to Fannie Mae and Freddie Mac by mortgage originators.

Does the HVCC apply to FHA loans?

No. Only Fannie Mae and Freddie Mac have agreed to adopt the code. The HVCC does not apply to FHA loans and the Federal Home Loan Banks are not participating.

Are lenders prohibited from requesting a second appraisal?

No, lenders are only prohibited from ordering a second appraisal if attempting to influence the outcome of the first appraisal. Section I.B.(9) of the HVCC addresses the issue of second appraisals.

More than 70% of NAR Appraiser members reported that consumers were paying higher fees since the HVCC rules went into effect.

Does the HVCC prohibit borrowers from providing payment directly to appraisers?

Yes, only the lender or a third party authorized to select and retain the appraiser can provide compensation to the appraiser.

Are settlement service firms permitted to order appraisals?

Yes, settlement service firms may order appraisals assuming they comply with the HVCC. Does the borrower get a free copy of the appraisal?

Yes, the Code requires the lender to provide the borrower a free copy of the appraisal report. The lender must provide the copy of the appraisal no less than three business days prior to closing.

Are lenders required to use a pre-approved appraiser list or panel?

No. Lenders may choose to use a pre-approved list or panel but are not required to do so by the Code.

Lenders choosing to use a pre-approved list or panel must ensure that (1) employees of the lender tasked with selecting appraisers are independent of the loan production staff and (2) loan production staff is not involved with selecting appraisers from the list for particular assignments.

Appraiser misconduct action will be conducted by state licensing agencies. What is new?

The code is primarily directed at regulating banks and other mortgage lenders and promoting appraisal independence.

New Resources on HVCC that can be found at www.realtor.org/hvcc FHFA New Guidance Notice Fannie Mae and Freddie Mac FAQ NAR Research: The Impact of HVCC HVCC Myth and Fact Flyer Complete Language of the HVCC

FALL 2009 KENTUCKY REALTORÂŽ 21

Local Association News Local boards/associations are encouraged to submit information for this section.

Pictures must be at least 300dpi. Send all association news to hcooper@kar.com.

NKY REALTORS® Present Check to Holly Hill Children’s Services

Northern Kentucky REALTORS®

NKY REALTORS® and their Affiliate members recently presented a donation of $6500 to Holly Hill Children’s Services. Connie Wong, Executive Director of Holly Hill Children’s Services accepted the donation from John Hodge, president of the Northern Kentucky Association of REALTORS®, along with members of the Association’s Public Relations committee who participated in golf outings and other fundraising events to benefit the charity. Holly Hill Children’s Services, an all-girls facility, is a social service agency.

After the check presentation, committee members traveled to Holly Hill’s California, KY campus to meet the girls in residence there and distribute gift bags to everyone. In a recent statement, Hodge said, “The members and Affiliates of the Association are proud to help out the wonderful Holly Hill organization. Their contribution to “at risk” children is a valuable service to our community.”

Paducah Board of REALTORS® Honors Several at Dedication The past presidents of the Paducah Board of REALTORS® purchased a flag pole for the board office, something they have never had before, and it was dedicated in their honor by Board President Leslie Heath.

The American flag, donated by Jesus’ Menendez, was flown over the U.S. Capitol in 1991 and was presented by Past Congressman Carol

22 www.kar.com

Hubbard. The Board held a dedication service to honor all their past presidents and the flag was raised in honor of all active and inactive military and Veterans.

“The flag will be flown daily in honor of our active military and the Veterans living and deceased who are fighting and have fought to protect the USA and to continue the freedoms we cherish to this day,” said Heath. “The Board would like to demonstrate to the public, as they pass our office, our pride in the men and women of the military service, who help us further the American Dream.”

The Board also has a REALTOR® flag, donated by a close REALTOR® friend, which will be flown under the American flag.

Lexington Named Ambassador City for 2009

Lexington was named a 2009 Ambassador City by NAR and the U.S. Conference of Mayors for the success of two homeownership programs, Repair Affair and the Remodeling for Access and Mobility Program (RAMP). The programs help low-income homeowners make much needed repairs and modifications.

RAMP and Repair Affair are initiatives of the REALTOR®-Community Housing Foundation of the Lexington-Bluegrass Association of REALTORS®. The foundation helps individuals achieve their dreams of homeownership “REALTORS® build communities and care as much about keeping families in their homes as they do about getting them into homes,” said NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth. “The home repairs and modifications done by the RAMP and Repair Affair programs are crucial to helping area homeowners live

independently and remain in their homes. These two programs have been incredibly successful and could be easily replicated in cities and towns across the country.”

Somerset-Lake Cumberland Association Contributes to Gary Schroeder Memorial Scholarship REALTOR® members lost a good friend and colleague when Gary Schroeder, then president of the Somerset-Lake Cumberland Association of REALTORS®, died suddenly on October 9, 2007. Now, Somerset-Lake Cumberland is proud to be a part of the Gary Schroeder Memorial Scholarship program, which his family created as a continuing legacy. A donation was presented to the Schroeder family in Gary’s memory.

Gary had a love of all sports but both of his sons played soccer, therefore, the scholarship was established to honor a Somerset-Pulaski County area soccer player based on academics, achievements on the soccer field, and community involvement. In July, Gary's son, Brian announced the 2009 scholarship recipient, Brandon Schleter, a Southwestern High School graduate, who will begin his college career at the University of Kentucky this fall.

Donations can be made to "Gary Schroeder Memorial Scholarship" and mailed to Craig Schroeder, 603 Lane Allen Road, Lexington, KY 40504.

Heart of Kentucky Association Gives Back The Heart of Kentucky Association has been busy this year as the community service committee assisted with several charities in the area. They participated in the American Cancer Society Relay for Life, bought 10 startup kits for persons in the local domestic violence shelter “Spring Haven,” sponsored the annual Children’s Fair, volunteered at the local soup kitchen “Warm Blessings and donated to North Hardin Hope and Helping Hands.

In addition, HKAR made a donation and members participated in the county wide Repair Affair in June and the New Horizon’s group participated in the “Hooray for Heroes” honoring the military and families living in the area.

GLAR Hosts Carnival Day for Camp Quality In July, members of the Greater Louisville Association of Realtors® Community Relations Committee headed to Camp Lukon to host the annual Carnival Day that GLAR hosts for the kids of Camp Quality. Carnival Day, one of the campers’ favorite experiences during their week, is an entire day devoted to fun for the Camp Quality Kids. Campers participate in an array of games, relays and sports as well as play on inflatable slides, bounces and obstacle courses. Goodie bags stuffed full of prizes were given to each camper, and the committee also hosted a giant cookout that fed over 200 people.

“Our goal is to help these children experience true happiness in an environment where they can ignore their overwhelming troubles,” said Dennis Miller, project chair. “This is the third year we have done this event for Camp Quality, and every year it just gets bigger and better!”

Camp Quality is a non-profit organization that provides a week long camping experience and year round support to children with cancer and their families.

Kudos Steve Lewis, with the Cave Run Association of REALTORS®, was inducted into the National Auctioneers Association’s (NAA) prestigious Hall of Fame at the 60th annual conference in Overland Park, Kansas in July. Steve, a REALTOR® member since 1973, has served as president for the Kentucky Auctioneer’s Association and has served on the Kentucky Board of Auctioneers Licensing Board since 1985.

Sharon Stubblefield, with the Madison County Board of REALTORS®, was the winner of a Prudential Cares Volunteer Grant to Habitat for Humanity for $250, the only such award given in Kentucky. The grant was received for Home Meals Delivery, a non-profit hot meal work day service to the disabled. Sharon, a REALTOR® member for 28 years, serves on the Madison County Habitat for Humanity Board of Directors and received the 2008 REALTOR® of the Year award from the Madison County Board of REALTORS®, an honor she also received in 1997.

FALL 2009 KENTUCKY REALTOR® 23

By The Numbers

According to the Census Housing Vacancies Survey, homeownership rates have fallen this much in Kentucky from 2000 (73.4%) to 2008 (72.8%).

Kentucky, is however, above the national average in 2008, which was 67.8%

-0.6%

56%

According to a study by JD Power and Associates, the proportion of first-time home buyers has increased to 56% in 2009 from 44% in 2008.

10x

According to an article in RISMedia, homes with 20 or more photos received almost 10 times the number of leads and more than 15 times the number of showings as homes with only one online photo. And Zillow.com found that over a seven-day period, listings with at least one photo were likely to be viewed 41 percent more times than listings with no photos.

23.6

According to Trulia as of June 2009, the percent of current homes on the market in the United States that have experienced at least one price cut, totaling $27.4 billion in reductions. The average price-reduced home has seen a listing price reduction of 10.6%.

The percent of NAR members were involved in a foreclosure transaction between July 2007 and June 28, 2008, according to results from the NAR 2009 Member Profile.

40

77.2

The percent of the online community who uses social networking sites, including Facebook, MySpace and LinkedIn. This is up from 27% a year ago according to The Conference Board and TNS. More than half of social networkers log on at least once a day, and the majority log on several times a day.

million

23

The median price of a vacation home fell by this percent in 2008 from 2007, according to the National Association of REALTORS速, and sales have dropped nearly 31% from 2007.

5,000

It is estimated that each American is exposed to well over this many advertising messages per day, and that children see over 50,000 TV commercials a year.

24 www.kar.com

3 out of 4 According to Kelton Research in 2005, this many Americans (72 percent) stated that when looking at available property, the neighborhood was more important than the house itself. The survey also revealed that on average, homebuyers spend 11.5 hours per week online researching potential homes to buy, a number that is even higher for women.

Housing Stats Kentucky Has Optimistic Second Quarter U.S. records positive numbers as well

I

t seems as though positive news has been all around us the past few weeks. Nationally, even though prices aren’t shooting through the roof just yet, the number of homes sold, both new and existing, is seeing some positive movement and breaking industry expectations.

Sales of previously occupied homes in the U.S rose for the third month in a row back in June.

NAR reported that home sales rose 3.6 percent to a seasonally adjusted annual rate of 4.89 million in June, from a downwardly revised pace of 4.72 million in May. In comparison, home sales haven’t risen for three straight months since early 2004, during the national housing boom. Prices, however, are expected to keep falling well into next year because of a backlog of foreclosures that have yet to come on to the market. The median sales price on the national level was $181,800 in June, down 15 percent from year-ago levels but up slightly from $174,700 in May. New U.S. home sales jumped 11% in June, the largest amount in more than eight years, as buyers took advantage of bargain prices, low interest rates and a federal tax credit for first-time homeowners. The last time sales rose so dramatically was in December 2000. New home sales have risen for five straight months. The median sales price of $206,200, however, was down 12 percent from $234,300 a year earlier and down nearly 6 percent from $219,000 in May. “It’s a good sign when you start seeing headlines that indicate the bottom has ended and the market is heading north,” says Jeff Smith, KAR president. “Hopefully, we continue to see improvement nationally and state-wide through the remainder of the year.”

Around Kentucky, the real estate industry has also taken a turn for the better. Median home prices for the second quarter saw an increase of just over a percent compared to the second quarter of 2008. In contrast, prices were down over 2.5 percent in the first quarter of 2009 versus 2008. As for homes sold, the second quarter of 2009 saw a decline of 11

Second Quarter 2009 vs. 2008 Board/Association

# Sold # Sold 2Q 2009 2Q 2008

# Sold %

Median Price 2Q 2009

Median Price 2Q 2008

Median Price %

Region One Henderson-Audubon BOR

73

80

-8.75%

74250

78500

-5.41%

Hopkinsville-Christian BOR

104

107

-2.80%

114920

111500

3.07%

84

72

16.67%

98000

116000

-15.52%

121

112

8.04%

96500

97500

-1.03%

Kentucky-Barkley Lakes BOR Madisonville-Hopkins BOR Mayfield-Graves BOR

54

77

-29.87%

67500

72834

-7.32%

Murray Calloway County BOR

94

67

40.30%

112500

98000

14.80%

Owensboro BOR

265

274

-3.28%

111450

113000

-1.37%

Paducah BOR

166

170

-2.35%

119900

119000

0.76%

Pennyrile BOR

86

99

-13.13%

89300

104000

-14.13%

Central Kentucky AOR

130

149

-12.75%

90250

110000

-17.95%

Heart of Kentucky AOR

405

441

-8.16%

128750

135000

-4.63%

Old Kentucky Home BOR

114

118

-3.39%

144150

113500

27.00%

REALTOR® Assn of SKY

355

520

-31.73%

125750

128000

-1.76%

Region Two

Russellville-Logan BOR

17

45

-62.22%

86500

107200

-19.31%

100

114

-12.28%

136500

144000

-5.21%

61

74

-17.57%

87500

102750

-14.84%

2882

3347

-13.89%

129000

135500

-4.80%

2067

2379

-13.11%

138000

145000

-4.83%

1280

1432

-10.61%

125000

133000

-6.02%

169

218

-22.48%

94500

93950

0.59%

42

29

44.83%

115000

77000

49.35%

Cumberland Valley BOR

123

150

-18.00%

106250

90500

17.40%

Eastern Kentucky AOR

121

122

-0.82%

117500

96750

21.45%

Madison County BOR

595

594

0.17%

124200

135000

-8.00%

42

60

-30.00%

70000

74625

-6.20%

Shelbyville BOR South Central Kentucky AOR Region Three Greater Louisville AOR Region Four Lexington Bluegrass AOR Region Five Northern Kentucky AOR Region Six Ashland Area BOR Cave Run AOR

Pioneer Trace BOR Somerset-Lake Cumberland BOR Totals

169

162

4.32%

100000

117000

-14.53%

9719

11012

-11.74%

111975

110750

1.11%

* Based on information from local REALTOR associations/MLSs for the periods of April 1 –June 30, 2008 and 2009. ®

percent when compared to the same time last year. This, however, is a dramatic change from the first quarter of this year, when numbers were down over 25 percent versus 2008. In June, homes sold in the state were down only 2.5 percent compared to 2008.

FALL 2009 KENTUCKY REALTOR® 25

Community Profile A Spotlight on ... Haunted Landmarks in Louisville

by Frankie Harris

L

ouisville, Kentucky is rich in tradition and history.

The Kentucky Derby, the Louisville Slugger, bourbon, and the iconic Muhammad Ali are some of the images brought to mind visiting this city. But behind the walls and within the corridors of some of the city’s most attractive and well known landmarks, a darker past is hidden. In the early 1800s Louisville’s nickname was “the graveyard of the west” due to the countless deaths caused by Indian wars, malaria, bacteria and especially the flooding from the Ohio River. Even early native Americans recognized the region as haunted and unsafe as the word “Kentucky” means “dark and bloody ground” in the Iroquois language. These are but a few reasons that researchers around the world recognize Louisville as one of the country’s most haunted cities.

The Seelbach Hotel

One of Louisville’s best known ghost stories can be discovered at the spectacular Seelbach Hotel. Since opening its doors in 1905, this four-diamond hotel has hosted countless guests of fame and infamy. Nine presidents, the Rolling Stones, Mikhail Gorbachev and Al Capone are but a few of the notable guests at the hotel. F. Scott Fitzgerald was a frequent guest of the hotel, and was so impressed with the building he used the Seelbach as his inspiration for the wedding scene between Tom and Daisy in his book The Great Gatsby.

With the hotel’s fascinating past and preserved architecture it is no wonder a few of the Seelbach’s guests have decided to remain forever.

The most well known spirit is known as the Lady in Blue. For decades her identity was a mystery. Repeatedly staff members and hotel guests would report sightings of a distraught looking woman wandering the upper floors and the mezzanine of the hotel, sometimes walking right

26 www.kar.com

through the elevator doors as if they aren’t even there.

Always described as having dark hair, wearing a blue dress and seeming to be in a state of misery, the hundreds of eye-witness accounts became impossible to ignore. Who was this mysterious woman, and why had she chosen to haunt the Seelbach for so many years?

No one knew for sure.

In 1987, a couple of employees took it upon themselves to discover the origin of this ghost story and spent a few hours at the public library. They made a remarkable discovery in an old newspaper article from 1936. The article described the tragic death of a woman named Patricia Wilson. According to the article, Patricia had moved to Louisville a year earlier. At the age of 24, she had separated from her husband. Days before her death, she had been in touch with her estranged husband hopeful to repair their marriage. Full of hope for the future, they had arranged to meet at the Seelbach Hotel. Patricia waited anxiously for him to arrive.

Hours passed, but he never made it. Finally, a hotel employee told her of the horrible news that the man she was expecting had died in a car accident en route to the Seelbach Hotel. Devastated, Patricia ran from the man and was missing for days. Friends and family were concerned about her, but there were few clues about her whereabouts.

A few days after her husband had died in the car accident, Patricia’s body was discovered in one of the hotel’s elevator shafts. It could have been an accident, but most believed she threw herself down the shaft in a desperate state of grief. According to the newspapers, the woman was wearing a blue dress when her body was found.

The Lady in Blue is apparently still actively haunting the hotel today.

“We have had several guests capture her image on film on the mezzanine level,” said Frankie Harris of Louisville Ghost Tours, “Sometimes people will comment on catching a scent in the air around the elevators like the aroma of a woman’s perfume.”

This ghost has been the topic of discussion in several magazines, books and newspapers. The Lady in Blue was even on Jeopardy once. She was one of the answers to a question on an episode aired on Halloween of 2003.

Although this is the best known ghost in downtown Louisville, she is hardly the only one. The Old City Jail was once famous for being one of the worst facilities in the country, not for its design or architecture, but for the brutal treatment of the prisoners there. Today, the criminals once housed there appear to still be tortured souls due to the way their ghosts wail and scream throughout the building.

Other stories like the rocking cradle in the Brennan House, the mysterious names drawn in sawdust at the Palace Theatre, the image of a cigar smoking man at the Brown Hotel, and the pale, thin figures witnessed in the windows of the oldest home in the downtown area are parts of a tapestry that make Louisville a truly haunted city.

The Palace Theatre

The Brown Hotel

Louisville Ghost Tours is a subsidiary of Timeline Ghost Tours. Timeline has been conducting tours for over six seasons and has successfully developed a reputation for providing entertaining, historically accurate tours. Our tours, tour guides and stories have been featured on the Travel Channel, TLC, NBC, CBS, FOX, PBS and more. If you would like to take Louisville Ghost Tour, call (502) 339-5445 or visit www.louisvilleghosttours.com. Mention the KAR Convention and receive $3 off each adult admission.

The Brennan House

Other Kentucky Hauntings One of the most well-known haunted places in Kentucky is the Waverly Hills Sanatorium located in Louisville. Literally thousands of people died here during the tuberculoses epidemic, as well as a suicide or two, and some untimely deaths at the hands of doctors who practiced experiments on their patients.

Liberty Hall, a historic mansion in Kentucky’s capital and formerly owned by the family of John Brown, one of Kentucky’s first senators, is said to be haunted by at least three different ghosts.

Supposedly, the prim and proper apparition of “The Gray Lady” has been reported dozens of times, but she is not alone. There have also been reports of a young unknown soldier peering in from outside the windows, as well as the image of an Opera singer who wondered into the garden while attending a party at Liberty Hall, and never returned.

The Clay Estates (Ashland and White Hall), located in Lexington and Richmond, are said to be visited by their previous owners. Henry’s white-haired ghost is often seen leaning against the fireplace mantel in the parlor of the Ashland estate. As for White Hall, the entire family seemingly decided to stay on, including some of the family’s servants.

Bardstown has its fair share of haunted hotels. The Jailers Inn, which was formerly a jail house and is now a bed and breakfast, has had numerous reports of disembodied footsteps and sounds of crying. The Old Talbott Inn supposedly has guests who never checked out.

FALL 2009 KENTUCKY REALTOR® 27

Legal Update Say What? A Guide to Legalese Part I - Ownership Rights

by Doug Martin

ardly a day goes by that I am not asked to translate legalisms for clients. You know what I mean – legalese, jargon, mumbo jumbo, gibberish, gobble-degoop, double speak, babble! As REALTORS®, you also decipher these terms for clients nearly every day. This section of Kentucky REALTOR® presents Part I of A Guide to Legalese to help you navigate these terms. Part 2 and beyond will come in future issues of the magazine.

the same time, and held by one and the same undivided possession. (These are known as the four unities of joint tenancy.) The most notable feature of joint tenancy is survivorship, whereby the entire interest of a deceased joint tenant passes equally at the time of death to the surviving joint tenants, and ultimately passing to the last surviving joint tenant. For this reason, joint tenants are frequently referred to as “joint tenants with right of survivorship.”

General Warranty & Special Warranty Deeds

Tenancy by the Entirety

H

A general warranty deed is an instrument conveying legal title to real estate, in which the seller binds herself and her heirs to warrant and forever defend title to the land conveyed against the claims of “all other persons.”

By contrast, in a special warranty deed, the seller only binds herself and her heirs to warrant and forever defend title to the land conveyed against the claims of the seller and persons claiming by or through the seller. Thus, a special warranty is much more limited than a general warranty, and does not warrant against defects arising earlier in the seller’s chain of title.

Quitclaim Deed A quitclaim deed is an instrument conveying an interest in real property by way of release. A quitclaim deed transfers all right, title or interest that the grantor may have in real property, if any, but the grantor does not warrant that his claim in the property is valid or that he in fact actually owns the property at all. In contrast to a general warranty or special warranty deed, a quitclaim deed contains no warranty or covenant of title at all.

Dower & Curtesy Dower is the common law right of a widow to certain lands or tenements upon the death of her husband, for her support and the nurture of her children. Curtesy is a similar common law right to certain lands or tenements to which a husband is entitled upon the death of his wife.

Joint Tenants Joint tenancy is an estate in land that arises by a purchase or grant to two or more persons. Joint tenants have one and the same interests, accruing by one and the same conveyance (such as a deed), commencing at one and

28 www.kar.com

Tenancy by the entirety is a form of joint tenancy that is created solely between a husband and wife. Tenants by the entirety together hold title to real property with right of survivorship, so that upon the death of either, title to real property passes to the spouse, even to the exclusion of heirs listed in the decedent’s will. The main difference between tenancy by the entirety and joint tenancy is that joint tenants may deal with the property as they wish. In tenancy by the entirety, each tenant effectively owns the entire property, and neither can deal with the property without the other. One effect is to prevent the judgment creditors of one spouse from enforcing liens against the subject property during the lifetime of the other spouse.

Tenancy in Common Tenancy in common is a relationship between owners where each owner holds an undivided interest in and an equal right to use and possess the subject property. Unlike joint tenancy or tenancy by the entirety, the interest of a tenant in common does not terminate upon his or her death, and there is no right of survivorship. Thus, upon the death of a tenant in common, their rights in the subject property pass to their estate or heirs, but not to the other tenants in common.

Doug Martin is Legal Counsel for the Kentucky Association of REALTORS® and maintains his private law practice in Lexington, KY.

The previous discussion should not be viewed as legal advice. Please consult your attorney.

Up to Code To Mediate, or Not to Mediate, That is the Question

By Y. Denise Payne Wade

T

he door to the Commission’s informal resolution process is opened whenever the Commission orders a case to proceed to an administrative hearing. Once opened, the parties are free to enter and explore the settlement possibilities that lie within, which may or may not involve mediation. This article will describe the Commission’s informal resolution process and the role that mediation plays in it.

After reviewing and considering all available information pertaining to its pending complaints, the Commission determines, by majority vote, which ones will proceed to a formal evidentiary hearing, identified as either a non-recovery fund case or a recovery fund case. A non-recovery fund complaint case involves allegations of one or more license law violations for which discipline could be imposed. In these cases, the parties are the real estate agent(s) complained against and the Commission, represented by one of its staff attorneys. In a recovery fund complaint case, the parties are the real estate agent(s), the Commission, and one or more consumers, alleging that they have suffered monetary losses as a result of the agent violating one or more license law provisions while engaged in fraud.

To initiate the hearing process, the Commission issues a Notice of Hearing and Charges, in accordance with the requirements of KRS Chapter 13B, which governs the process. Thereafter, Commission staff contacts the Attorney General’s office to schedule a telephonic prehearing conference with the parties and the assigned hearing officer, who is employed by that office. The purpose of the conference is to explore settlement and mediation possibilities, as well as other matters that will promote the orderly and prompt conduct of the hearing.

The Attorney General’s office provides hearing officer and/or mediation services for the Commission, and other administrative agencies in Kentucky, upon request.

During mediations in the Commission’s non-recovery fund cases, it is my responsibility to ensure that I have access to all the available information I need to reach a fair and equitable settlement agreement. This could mean that an individual with firsthand knowledge about the facts in a mediated case involving a swearing match, for example, might be invited to attend and participate in the mediation, to help clarify the facts only. Under those circumstances, the individual will not have party status.

During mediations in the Commission’s recovery fund cases, I have the additional responsibility of ensuring that the consumer parties understand that I represent the Commission only and that it is their personal responsibility to decide whether they need private legal advice. In these cases, my role is also to protect the Commission’s recovery fund against improper claims by having the facts clarified, to the fullest extent possible.

Finally, the role that mediation plays in the Commission’s informal resolution process has changed over the years. Specifically, the Commission’s former staff attorneys, exercising their Commission-granted discretion, routinely requested mediation for each case that the Commission ordered to hearing. Exercising that same discretion, I have deviated from that practice because it is my belief that mediation should not be the “first step” in settlement discussions. For me, the first step should be offering the parties a proposed settlement agreement.

While a right to a hearing exists, a right to mediation does not. Consequently, none of the parties, including the Commission’s representative/staff attorney, is “ordered” to participate in mediation. Nonetheless, I agree to participate in it if an impasse has been reached during the parties’ initial “good-faith” settlement discussions. I emphasize “good-faith” because it takes more than a “we have it and we reject it” response to a settlement offer (or worse: mere silence) for me to agree to participate in mediation, which is strictly a voluntary process.

To conclude, mediation is more beneficial when it is timely and properly used. Moreover, if mediation is truly warranted in a particular case, it will likely be more productive and efficient if the parties have engaged in good-faith settlement discussions beforehand. By doing so, the parties increase the odds that they will be able to identify and address the issue or issues that caused them to deadlock and seek mediation.

Y. Denise Payne Wade, Staff Attorney, Kentucky Real Estate Commission

FALL 2009 KENTUCKY REALTOR® 29

A Day in the Life of...

A GRI Designee Earleene Woods Murray, KY Held GRI designation for almost 2 years

When did you receive real estate license and when did you begin working toward your GRI designation?

I received my real estate license in June of 1988. I took my first GRI class years ago and completed the program in January 2008.

What influenced you to get the GRI designation?

There was a 3 day class offered close to me back when it was very rare that a GRI class was offered in the area. When the time limit (there is a 5 year limit on start to finish on the GRI designation) was placed on completing the designation, I decided to go on and finish because I didn't want to lose my credit. I am so glad I did now because not only did it teach me a lot, it spurred me on to further my education.

How has holding the GRI designation helped your business?

I think more than anything, it has increased my confidence and given me better tools to do my job.

What is the most important aspect of education that all REALTORS® and licensees should keep in mind?

As a residential agent, I think we can lose sight of the fact that the home is the largest single investment most clients make. Most of the time, we are helping them make a very life changing decision. There is a fine line that has to be walked - it needs to be a professional and insightful process, but it needs to be fun too.

What kind of clientele do you most often work with?

Average income. I do not get many high end buyers or sellers.

What other designations do you hold?

I have my CRS (Certified Residential Specialist). I also have the ASP (Accredited Staging Professional) designation and am a graduate of the LeadershipKAR class of 2008.

From the perspective of a GRI designee, what advice would you give your fellow real estate agents?

Don't pace yourself by everyone else. Just strive to be a better agent with each and every transaction.

30 www.kar.com

Above all else, what is your favorite thing about being in the real estate business?

Definitely the people. I have made so many friends in this industry. The REALTORS® I work with everyday, the agents I have met going to meetings across the state and clients and customers I have been able to assist.

What is the funniest or most embarrassing situation you have been in as a REALTOR®?

Probably one of the more "interesting" moments was when I showed a house several years ago. There was no door on the front of the house and the house had been added on to numerous times. We went in thru the carport and "meandered" all the way through to the far bedroom. We were discussing how far it was to get to an outside door from that bedroom when I opened the closet door and in the floor laid a 6' long snake skin. I informed my customers to be prepared because the house was going to have a front door soon if the owner of that skin came in looking for it.

Do you have any future plans in furthering your education?

Definitely. I am planning to start on another designation the first of next year. Not sure which one yet, but I think it will be ABR. Outside of business, what is your favorite past-time?

I enjoy cooking. My favorite is baking cakes and cookies. I also like to read and I love to travel. Taking pictures is also a big hobby (and necessary for business) – I love my camera.

What is the best advice you have ever received?

It came from Mike Gooch, an instructor of the GRI 2. He told us he just didn’t understand the mentality of REALTORS® in the industry. Seventy-five percent of our business comes from other REALTORS® and yet most of us try to make everything one-upmanship and try to prove how smart we are. He said we need to use the golden rule and treat other REALTORS® with respect. I think if we all did that, not only would we be winners, our buyers and sellers would be too.

SPECIAL ANNOUNCEMENT FROM NAR: FOR OUR MEMBERS ®

The NATIONAL ASSOCIATION OF REALTORS has carefully considered how we can best support you, our members, in these uncertain times. NAR is here to assist you and your business with the RIGHT TOOLS, RIGHT NOW. Effective immediately, NAR is offering members over 300 NAR products, publications and services for FREE or AT COST so you can easily take advantage of the timely tools, tips and strategies you and your business need.

NAR IS HERE TO SUPPORT OUR MEMBERS— NOW.

Get these valuable products and resources RIGHT NOW at www.REALTOR.org/RightTools

RIGHT TOOLS, RIGHT NOW offers hundreds of business building NAR products and resources FREE or AT COST, including information on The Homebuyer’s Tax Credit, Webinars, Downloadable eProducts, and much more—all aimed at your success.

www.REALTOR.org/RightTools