We're Changing Our Name!
Saturday 27 June 2009
On July 1st, we will be changing our name from “Mid-Florida Regional Multiple Listing Service” to “My Florida Regional MLS.” With the recent expansion into Southwest Florida, we've outgrown our old name—literally. The new name will better reflect our direction and will be consistent with the name of our consumer website, MyFloridaHomesMLS.com.
Here's Our New Logo!
After analyzing several designs from different graphic artists, the Board of Directors and internal staff chose this logo as the favorite. The magnifying glass juxtaposed over the state symbolizes what we do— we focus on real estate. But that's not all… we focus on technology; we focus on products; we focus on Florida. Best of all, we focus on your success.
Newsletter gets Facelift, New Name
With our name change to "My Florida Regional MLS" it makes sense to brand our electronic newsletter accordingly. My Florida Focus is the new name of our newsletter publications. When considering the magnifying glass icon in our new corporate logo, the term "focus" is certainly appropriate.
In addition to our usual news and product upgrade announcements, you'll see new and relevant industry related articles.
Click on the image to view the latest edition of My Florida Focus.
Market Conditions (1004 MC) Report
Saturday 27 June 2009
We are pleased to announce that on July 1, 2009, MFRMLS will make available to all members a new Market Conditions (1004MC) report that can be accessed from MLXchange for no additional charge. The primary use of the report is for appraisers to complete the Market Conditions Addendum* to the Appraisal Report, now required on all appraisals performed beginning April 1, 2009. As a secondary use, members can use this report to gain a more detailed understanding of the overall market trends for properties and neighborhoods.
During the month of July, MFRMLS will offer webinars demonstrating how to use and interpret the market conditions report.
For additional information about the Market Conditions Addendum, please refer to the following Fannie Mae resources:
Official Fannie Mae Announcement – View Announcement 08-30 (.pdf)
Official Fannie Mae Form – Download PDF
Official Fannie Mae Training Session – View Recorded Training
Official Fannie Mae FAQs – FAQs (.pdf)
*The Market Conditions Addendum (Form 1004MC) is designed to enhance the transparency of the market trends and conditions conclusions made by the appraiser. The Market Conditions Addendum will be required for residential property appraisals performed on or after April 1, 2009. This requirement applies to loans delivered to Fannie Mae, whether the loans are underwritten manually or through Desktop Underwriter®:
The Market Conditions Addendum is intended to provide the lender/client with a clear and accurate understanding of the market trends and conditions prevalent in the subject neighborhood. The form provides the appraiser with a structured format to report the data and to identify current market trends and conditions. The appraiser's conclusions must be reported in the "Neighborhood" section of the appraisal report.
New Short Sale Field is postponed
Saturday 27 June 2009
MLXchange Update: Special Sale Provision
We recently announced the launch of a new Short Sale Field in MLXchange which was to take effect on June 30th. The leadership team has decided to postpone this launch pending review of the functionality of this initiative. We will keep you posted on any further developments.
You Spoke and We Listened!
Saturday 27 June 2009
Technical Updates Improve the System
In our daily encounters, whether in training sessions, on the phone with the Help Desk Technicians, or even in our feedback form on the website, we gather and evaluate your suggestions. We are pleased to announce the implementation of these suggestions:
- "Pool (Home) Y/N" – is changing to "Private Pool Y/N" (private pool versus community pool which is located in the Community Features field.)
- "Spanish" in the Architectural Style field is changing to "Spanish/Mediterranean"
- "Heating & Fuel" – is changing to "Heating and Fuel"
- "IDX Y/N" – from a radial button option to a drop down selection field
- "Originating Board" – is changing to "Office Primary Board ID"
Hot Fix 6 begins July 7th
Saturday 27 June 2009
On Tuesday, July 7, 2009, there will be a "Hot Fix" applied to MLXchange. There will be no down time for the system. This change will correct a few minor defects as well as offer a new option for agents to see all activity within their firm.
The most significant changes include:
1. Improved navigation menu behavior – The navigation menus have undergone a complete overhaul to improve their utility. Menus and sub-menus now consistently display when desired, and only when desired.
2. The home page Inventory Watch now includes a "My Firm" mode, in addition to the existing "Personal" and "My Office" modes – The same set of counts are displayed for My Firm as for My Office, but the numbers reflect all offices in the member's firm, rather than just the member's primary office.
3. IE 8 Compatibility – Upgrade Instructions: Microsoft recently started pushing Internet Explorer 8 as an automatic update. After IE8 is installed, members may receive an error message the first time they access. To alleviate any further error messages please follow these short steps after upgrading to IE 8:
a) Open Internet Explorer. Click on the Tools menu from the top of the page. Next click on Internet Options, then select Compatibility View Settings. Your screen should look like the screenshot below. Type "mlxchange.com" in the box and click Add, then Close.
Click to Enlarge the Thumbnail (A new Tab or Browser Window will open.)
b) Next click on Tools, Internet Options, click the Security tab, Trusted Sites, and finally click Sites. Type "http://mfr.mlxchange.com" into the box. Also ensure the checkbox that says "Require server verification for all sites in this zone" is UNCHECKED and then click the Add button before closing (see screenshot below).
Click to Enlarge the Thumbnail (A new Tab or Browser Window will open.)
Click to Enlarge the Thumbnail (A new Tab or Browser Window will open.)
4. Elimination of the Grid Field – Beginning Tuesday, July 7, 2009 the Grid field will be removed from MLXchange. The Grid field has always been a required field when entering listings; however, when searching by grid coordinates, inconsistencies are frequently found due to the lack of a single gridding system used by all boards and associations.
If you have saved searches where the Grid field is part of the search, the search will need to be redefined using another field for the location of the properties. If a search is not updated with a new location parameter (map area, zip code, subdivision, etc.) the search will generate a large number of results and will no longer be accurate for your customers. This will affect both prospecting as well as normal searches. MFR suggests using the map to outline the area(s) desired as you update your saved search and to create new searches in the future.
If you run into any issues please do not hesitate to contact our top-notch helpdesk and we will walk through the process together!
Thank you for your flexibility as we continue to improve the usability of our system.
Resources: First-Time Home Buyer Tax Credit
Saturday 27 June 2009
As part of the economic stimulus package to revitalize the housing industry, Congress passed legislation granting an $8,000 tax credit to first-time home buyers. To qualify, a "first-time home buyer" must not have owned a residence during the past three years and must purchase between January 1, 2009 and December 1, 2009. The credit can be used on primary residences, including single-family homes, condos, townhomes and co-ops.
The credit is determined by two factors—the price of the home and the buyer's income. The credit is equal to 10% of the purchase price of the home, up to $8,000. When considering income, the maximum credit of $8,000 is available for incomes up to $75,000 for singles and $150,000 for married couples. The credit will be reduced for incomes ranging between $75,000 and $95,000 for single buyers and $150,000 and $170,000 for couples. The credit can be calculated on the IRS Tax Form 5405 (PDF).
Other resources:
IRS: First-Time Home Buyer Tax Information>>
IRS Tax Form 5405: First-Time Homebuyer Credit>> (PDF)
NAR: "The Basics—2009 First-Time Home Buyer Tax Credit>>
FAR Flyer: What you should know about the $8k tax credit>> (PDF)
Special Edition: Short Sales
Friday 26 June 2009
It’s no secret that short sales can be enigmatic, if not problematic. As our members deal with the intricacies involved in successfully closing a short sale, navigate the layers of approval and strive to help both buyers and sellers, MFRMLS is tasked with maintaining an accurate MLS listing database to the benefit of all members.
This special edition of My Florida Focus™ will address policies, rules and procedures that affect the way short sale information is entered into the MLS. We will answer commonly asked questions, explain related rules, and even provide some helpful links. From a technology standpoint, continue reading and find upcoming changes in MLXchange that will provide consistency in disclosing short sales and improve the quality of short sale related data as it is entered with each new listing.
While the market is showing signs of improvement, it’s important to note that there have been over 11,000 listings entered in our system that indicate a potential short sale since January 1, 2009; 315 have been reported as sold transactions during that same period. It’s clear that short sales are here to stay for the unforeseeable future. The need for consistent application of rules and policies as they relate to short sales, fair disclosure to all parties, and accurate data is paramount. This ezine is a must read for all MFRMLS Participants and Subscribers. Much of the information included has been prepared by our legal counsel – to both explain rules and highlight specific practices that are in violation of those rules.
It’s not just about rules, but also about resources (including Fannie Mae) and answers that you’ve been looking for.
Please review all of the articles in this special Short Sale edition to bring MFRMLS rules, polices and system changes into Focus.
Special Edition: Short Sale - Table of Contents
1) Rules and Ethics Applicable to Short Sales
2) Enforcement Process
3) Seller Must be Owner in MLS
4) FAR Short Sale Addendum
5) Fannie Mae and Short Sales/Resouces
Rules and Ethics Applicable to Short Sales
Friday 26 June 2009
From MFRMLS Legal Counsel
The purpose of this section is to review the many issues which continue to arise with regard to listing ”Short Sales” in MFRMLS. Briefly, the Short Sale Rules and Regulations of MFRMLS (Article 4, Section1.C.) provide:
MANDATORY DISCLOSURE IS REQUIRED
1. A listing broker must clearly and promptly disclose “Potential Short Sale Circumstances” to all cooperating brokers.
2. A listing broker must obtain a seller’s written consent before disclosing the following “Potential Short Sale Circumstances:”
a. The sale price may be insufficient to pay the total of all liens and costs of sale.
b. The seller may not be able to bring sufficient assets to the closing to cure all deficiencies.
3. If applicable, the listing broker must also disclose that the sale of the listed property may be conditioned upon the approval of a court, a lender, or other third party.
HOW TO MAKE THE MANDATORY DISCLOSURES
The required Short Sale disclosures must be made in the Public Remarks and the Realtor Only Sections of the listing as follows:
1. Public Remarks Section. The first words in the Public Remarks Section must always be:
“Short Sale”
2. Realtor Only Remarks Section.
a. OPTION ONE: If the listing broker does not want to obligate cooperating brokers to accept a reduced commission which may be required by seller’s lender, the first words in the Public Remarks section must be:
“Short Sale”
b. OPTION TWO: If the listing broker does want to obligate cooperating brokers to accept a reduced commission which may be required by seller’s lender, the first words in the Public Remarks section must be “Short Sale” and the Realtor Only Remarks must begin as follows:
“Short Sale; approval of the seller’s lenders(s) may be conditioned upon the gross commission being reduced.”
*Editor’s Note: These are not new rules, but a revision that allows simply for the statement “Short Sale” instead of the longer verbiage that was required in the past. Identifying the listing in MLXchange as a short sale and the language noted above are both required. Additionally, be certain to pay particular attention to the Best Practice as described below.
Best Practice - Article 4, Section 1C.3
Although not mandatory, under Option Two MFRMLS considers it a best practice to disclose how any gross commission reduction will be apportioned between listing and cooperating brokers. If the broker elects not to disclose the apportionment, he or she will be obligated to pay the cooperating broker the compensation shown in the listing. Disclosure may be made either in the listing or provided to the cooperating broker prior to their producing an offer. (Refer to Article 4, Section 1.C.3 of the MFRMLS Rules to read the full text.)
THE LISTING BROKER’S OFFER OF COMPENSATION MAY BE CHANGED IN A SHORT SALE (Article 4, Section 1.C.4)
Generally, the offer of compensation made by listing brokers to cooperating brokers is unconditional. That means the amount of compensation cannot be unilaterally changed by the listing broker after a cooperating broker has produced a ready, able, and willing buyer. However, in Short Sale Circumstances, a lender is presented with a problem – whether to release its mortgage for a sum that is sometimes far less than what is owed to the lender. Faced with this decision, lenders quite often refuse to approve a short sale unless some additional amount is paid to the lender which will lessen the lender’s loss. Unfortunately, the financial concession most often discussed by the lender and the parties is a reduction of the brokerage commission.
When a lender refuses to approve a contract, the listing broker may sometimes be willing to accept less commission in order to obtain the lender’s approval. If the listing broker has used Option One above, the listing broker cannot require the cooperating broker to accept less commission than the cooperating broker was originally offered in the listing. Thus, any reduction in the overall commission to be paid may be borne solely by the listing broker. If Option Two was used by the listing broker, then the cooperating broker may be required to accept a reduced commission.
A LISTING MUST BE REPORTED AS “PENDING” WHEN THE BUYER’S SHORT SALE OFFER HAS BEEN SUBMITTED TO THE LENDER FOR APPROVAL (Article 4.15)
Recently, there have been numerous attempts by some listing brokers to avoid changing a listing to “pending” when the buyer’s Short Sale offer has been presented to a lender for approval. MFRMLS’s Rule is very clear:
Article 4.15 of the Rules:
All listings with an executed contract must be changed to “pending” status within two business days, with the exception of Right of First Refusal. Properties with any other contingencies are not allowed to remain in active status. Pending status must be chosen and additional items may be selected under the Contract Status field. For example, if the sellers wish to solicit back up offers, this option is available under the Contract Status field.
Not only is the Rule clear, a listing broker’s failure to keep other Users of MFRMLS timely and accurately informed about the status of a listing may violate not only the purposes and intentions of the MFRMLS Rules, but also provisions of the NAR Code of Ethics. Fundamentally, the Rules and the Code of Ethics strive to ensure that all parties are treated honestly, that the market functions with complete and accurate information, and that misleading listing information is avoided. Of particular concern are the following ethical considerations:
Article 1 of the Code of Ethics:
When representing a buyer, seller, landlord, tenant, or other client as an agent, REALTORS® pledge themselves to protect and promote the interests of their client. This obligation to the client is primary, but it does not relieve REALTORS® of their obligation to treat all parties honestly. When serving a buyer, seller, landlord, tenant or other party in a non-agency capacity, REALTORS® remain obligated to treat all parties honestly.
Article 2 of the Code of Ethics:
REALTORS® shall avoid exaggeration, misrepresentation, or concealment of pertinent facts relating to the property or the transaction.
Standard of Practice 3-6
REALTORS® shall disclose the existence of accepted offers, including offers with unresolved contingencies, to any broker seeking cooperation.
Article 12 of the Code of Ethics:
REALTORS® shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations.
In light of the above ethical considerations, when a buyer’s Short Sale offer to purchase is submitted to a lender for approval, the listing must be reported as “pending” under MFRMLS Rules.
SELLERS AND BUYERS MAY NOT AUTHORIZE A LISTING BROKER TO VIOLATE MFRMLS RULES OR THE CODE OF ETHICS (Article 3.4)
A contract or any other type of “agreement” between buyer and seller – whether the parties wish to call it a “contract” or an “offer,” or simply an understanding – cannot be used by a member of MFR to justify the member’s non-compliance with the Rules or the Code of Ethics. For example, a provision in a contract which attempts to grant seller the “right” to “…continue to market the Property and advertize it through the MLS as available for sale…” (emphasis supplied), is not a valid basis for a member of MFR to violate the Rules or Code of Ethics. The listing of a property subject to such an agreement between seller and buyer must be reported as “pending” under MFRMLS Rules.
Article 3, Section 4: All Listings Subject To Rules and Regulations of MFRMLS: Any listing filed with MFRMLS is subject to rules and regulations of MFRMLS upon signature of the seller(s) and the Participant or authorized signatory. Listings that fall into the property types in Article 4, Section 1 must be filed with MFRMLS within two business days after obtaining all required signatures.
CONTRACTS, OFFERS AND RIGHTS OF FIRST REFUSAL – MFRMLS's Position
As explained by MFRMLS legal counsel
There are forms being used in the market today that do not comply with the plain meaning – much less the spirit – of the Rules and the Code of Ethics. Several of these forms expressly state that, despite execution by both the seller and buyer of the written “document,” the parties intend the document to be an “offer” and not a “contract.” Some of these forms provide that the “offer” will not be considered a “contract” unless and until the parties agree to changes which a third party – the seller’s lender – may require to be made to the “offer.”
Declaring that a writing between seller and buyer is an offer and not a contract does not necessarily make it so – especially if the essential elements of a contract are present. By definition, an offer is “made” by one party to another party who is capable of accepting or rejecting the “offer.” Generally, once the offer is accepted and the parties have fully executed it, the “writing” becomes a contract.
Of course, the performance of the “contract” may be subject to a third party’s approval – such as seller’s lender. If the lender approves the parties’ “contract” without change, then the contingency will have been satisfied. In that circumstance there is no further acceptance needed by either seller or buyer – the parties simply continue to fulfill their respective contractual obligations. The “contract” does not simply spring into existence at that point – it already was in existence.
Other forms in use today have attempted to use the “right of first refusal” exception of the Rules to avoid reporting a listing as “pending.” These forms have generally been used to submit multiple “offers” or “contracts” to seller’s lender and to then characterize lender’s right to approve one of the “offers” or “contracts” as a right of first refusal. Simply stated, under MFRMLS Rules this is not a right of first refusal. A right of first refusal exists when a third party has the right to acquire a property by replacing – or stepping into the shoes of – another buyer. The lender is not stepping into the shoes of the buyer – it is simply approving or disapproving the amount it will accept to release its mortgage lien.
CONCLUSION
When dealing with Short Sales remember the fundamental purpose and intent of the MFRMLS Rules and the NAR Code of Ethics: to ensure that all parties are treated honestly, that the market functions with complete and accurate information, and that misleading listing information is avoided. Ask yourself whether your conduct will assist other MFRMLS members in their efforts to honestly, accurately, and truthfully advise customers interested in a property as to the status of such property or will your conduct prevent them from being able to do so.
Next Short Sale Article:
The MLS Enforcement Process
Friday 26 June 2009
MFRMLS is focused on member service – and one of the most valuable services we can provide our subscribers is to ensure accurate and current listing content. An MLS is tasked with providing a framework for cooperation and compensation among licensed real estate professionals, the organization adopts bylaws, procedures, rules and regulations aimed at ensuring subscribers can rely on the information in each other’s listings.
We do this through a combination of processes and procedures that include MLXchange software features and “business rules,” an automated database checking system, manual database searches, agent reports, and courtesy notices and fines for violations, if necessary.
Here’s a brief description of some of the steps we use to ensure you have accurate, reliable data:
1. Our ICheck software program automatically compares critical fields in each new listing against a table of acceptable entries based on our current Rules & Regulations and sends an automatic courtesy e-mail notice to those not in compliance.
2. MFR staff regularly searches the active database for those fields ICheck is not designed to process, e.g. inappropriate or missing verbiage in the REALTOR-Only and Public Remarks as well as changes from Active to Pending status that were not made in a timely fashion.
3. Through the MLXchange program, subscribers can alert MFR staff to possible violations. These are reviewed and researched during the workweek and notifications are sent where applicable. Depending on the workload, these reviews may take 5-7 business days.
4. In cases where subscribers or companies experience recurring violations, the Director of Administration personally contacts the broker to discuss and recommend corrective measures.
While it may be uncomfortable for members to report errors, using the correction reporting feature does help keep the database clean. MFR staff appreciates your understanding if you receive a notice requesting a correction. Please call or email us for assistance.
Next Short Sale Article:
Seller Must Be Owner in MLS
Friday 26 June 2009
A very important MLS rule states that the SELLER of a property listed on the MLS must be the OWNER. This may seem obvious, but circumstances often arise where it seems reasonable to assume ownership, and such situations can easily lead to trouble.
For example, frequently in cases of new construction, the CONTRACTED BUYER will approach an agent to list the property. However, until the CONTRACTED BUYER actually closes, the DEVELOPER owns the property, and the property cannot be listed on the MLS on behalf of the CONTRACTED BUYER.
Another re-emerging instance involves a 3rd party (often an investor) wanting to list a home for sale as soon as they enter into a sales contract on the property. Typically the goal of the investor is to find a buyer to purchase the property and have a simultaneous closing – also known as “flipping.” Likewise, an “option” to purchase (recorded or otherwise) is not accepted as “ownership” by MFRMLS. Imagine the trouble that could arise if there were two contracts and three parties entangled in a real estate transaction when the first contract fails to close, or the potential of a foreclosure if a short-sale is a part of the picture. It’s easy to see the legal implications that could expose both brokers and the MLS to liability. This rule was adapted in July of 2007; in light of an increase in inquiries from members, this friendly reminder of the rule seems prudent.
Next Short Sale Article: