SIAR Service Corporation Suggested Guidelines
(aka Pink Sheets)
These are SIAR Board approved guidelines. These are not rules or regulations, just Best Practices. If you would like to contribute to these guidelines, please submit a copy to the board for review and approval.
Appraisals (revised July, 2017)
Closing Certification (revised August, 2017)
Inspection Responses (revised July, 2017)
Selling HUD Properties (revised June, 2017)
Showing Etiquette (revised August, 2017)
MLS Data Entry Guidelines (revised August, 2017)
Sellers Residential Real Estate Sales Discloser – State Form 46234 (revised October, 2017)
There’s a Form for That (revised August, 2017)
Cyber Security for REALTORS® (revised February, 2018)
NAR Logos and Trademark Rules (revised May, 2017)
GENERAL GUIDELINES
Appraisals (Back to Index)
Appraisal Guidelines (revised July, 2017)
Measuring a home:
Local appraisers utilize the American National Standard Institute (ANSI) standards for measuring a home.
http://krec.ky.gov/legal/Legal%20Forms%20%20Contracts/calc_sqfootage.pdf
While Fannie Mae or Freddie Mac may utilize a different method for calculating square footage of certain styles of homes (bi-level, tri-level, etc.) local market precedent then supersedes any edict from Fannie/Freddie. Lower level of these types of homes do have their square footage included in the livable area if there is a portion, with windows, still above grade. A tri-level or quad-level with a subterranean basement would not have that square footage included in the livable, however. It would then be counted as basement square footage. Fannie Mae Appraiser Independence Requirements: https://www.fanniemae.com/content/faq/appraiser-independence-requirements-faqs.pdf
Q53 addresses whether an appraiser can speak to a Broker.
The main key to take away here is to not try to influence the appraiser. Any attempt to influence the appraiser can be constituted as a violation and is a cause for the appraiser to stop working on the file immediately.
Freddie Mac Appraiser Independence Requirements: http://www.freddiemac.com/singlefamily/appraiser_independence_faq.html
Freddie Mac guidelines are very similar to Fannie Mae, but there are some different questions answered with their FAQ.
Reconsideration of Value or omission of pertinent facts:
Whenever there is a discrepancy with the appraised value there are certain steps that should be followed. If there are factual errors where a bedroom or bath, etc. was left out, or if there are good comparable sales within close proximity that were not utilized the lender should be contacted. Any other omission or error should be reported to the lender, as well.
The buyer should contact the lender and let them know there was an error and what the error was. If it has an impact on value the lender should follow up with the appraiser and allow time for a response.
If a value reconsideration is requested the buyer should contact the lender and provide evidence of superior sales that they believe should have been utilized. Don’t just submit sales, as most appraiser will discard without analysis. Provide sales and an analysis of each one provided and why that sale is superior to the ones utilized in the appraisal. DO NOT CONTACT THE APPRAISER AT THIS TIME! Any calls made directly to the appraiser at this time could or may be considered an attempt to influence value which will stop the appraiser immediately. Provide all evidence to the lender at let them forward to the appraiser. Merely calling and berating the appraiser will accomplish nothing except create animosity and most likely shut down any chance for meaningful dialogue.
Closing Certification (Back to Index)
Closing Certification (revised August, 2017)
For all properties, whereby a SRRESD (Sellers Residential Real Estate Sales Disclosure – State Form 46234 is required, the seller must re-certify the known condition of the property at closing. If the condition is un-changed the seller may simply sign at the bottom of the original SRRESD in the place provided and this completes the process. The seller, or listing broker, may elect to use a separate Closing Certification form. There are two versions of this form, one states the condition of the property is un-changed, the other discloses material change(s) of defect(s).
If the seller provides an amended SRRESD or a closing certification which disclose previously undisclosed defect(s), the buyer has a 48 hour right of rescission of the Purchase Agreement. The Buyer may waive such right and sign the closing certification accepting the property.
The seller, or listing side of the transaction is responsible for providing the certification. Buyers should not sign a closing certification until AFTER the seller has certified the condition of the property.
Inspection Responses (Back to Index)
Inspection Responses (revised July, 2017)
Inspection response(s) can be the most challenging aspect of the entire process. This process can be less contentious if clients are well informed of their duties and responsibilities under the Agreement, all time frames to respond are reasonable, communication is good, and procedures are adhered to.
There is no list of items that qualify as defects. However, the Indiana Real Estate Commission defines a defect as: “a condition that would have a significant adverse effect on the value of the property, that would significantly impair the health or safety of future occupants of the property, or that if not repaired, removed or replaced would significantly shorten or adversely affect the expected normal life of the premises.”
If a buyer reserves the right to have inspections as part of the Purchase Agreement, there are two choices for the inspection response form. While the language in the Agreement indicates that failure to respond by a designated date indicates acceptance, it is preferable that a response be submitted by the appropriate party (buyer or seller).
If the buyer, having reserved the right to have inspections, either decides not to have inspections, or, decides to accept the property in the condition reported in the inspection report(s), a Buyers Inspection Response Acceptance of Property Condition form should be used. This is a straight forward document. Buyer will check the appropriate box and sign the form. No seller response is required.
If, having had inspections, the buyer wishes to ask for repairs or other remedies, a Buyers Inspection Response form should be used. Since it is possible that multiple responses and counter responses may be necessary, the response form should be numbered on the line provided. Space is provided to itemize or explain necessary repairs or remedies. An Addendum to Inspection Response form is available for those instances where additional space is required. Buyer will indicate how much time the seller has to respond. Seller should be given adequate time to procure professional opinions or estimates if applicable. The seller will respond back to the buyer on the same form, either by accepting the buyer’s response, or by indicating a Seller’s Response to Inspections is forthcoming.
A form to request additional time (Request for Extension of Time for Inspection Response/Reply) is available for either the buyer or seller to utilize as necessary.
A Sellers Response to Inspection form is used by the seller to respond back to the buyer regarding inspection repairs/remedies etc. It provides the buyer with a similar opportunity to accept or respond back with another Buyer’s Response form.
For instances when the property is being sold As-Is, an “AS-IS” Addendum to Purchase Agreement should accompany the offer to purchase. This form sets out the buyer’s right to terminate the Agreement in the event inspections are not satisfactory.
Selling HUD Properties (Back to Index)
Selling HUD Properties (revised June, 2017)
HUD Properties are advertised for sale on HUDHomestore.com. This is a public accessible web site with a secure broker login side for submitting bids etc. Brokers must be registered with HUD in order to submit bids. There are tabs and links on this site with information and resources on how to register to become a HUD registered broker.
In order to sign a HUD sales contract and submit bids on HUD properties Principal Brokers must first obtain an NAID number and register on Hudhomestore.com. To start this process, click on the “NAID Application” tab.
Once the Principal (Managing) Broker is registered agents may register as eligible bidders. There is a link to “Register” as a “Bidder” in the top right corner of the HUDHomestore home page.
Starting May 2017 HUD is transitioning to E-Signatures on contract packages utilizing Docusign.
There are numerous help and training tools on the HUDHomestore site including videos and FAQs.
HUD properties have a property case number (example 151-123456). The case number is important in the bid process and is required on all contracts and communications.
To submit a bid, first search for and locate the property. You can start the search from the HUDHomestore home page by either clicking on the state on the map, or completing the search dialog box below. Once you see the property in the search results, click on the Property Case number. This will take you to the Property Details. There are useful tabs here containing various addendums and contact information for the asset manager and listing broker. From the Property Info tab, click on the “Submit an Offer” button. Note, you will need your NAID number in order to continue and submit the bid. Please check the eligible bidders and bid submission information on the Property Details page.
Agents who are registered bidders must keep their profile information up to date. This includes changing their real estate license expiration date upon renewal. To do this you must log-in and then click on the “Manage Profile” tab.
Showing Etiquette (Back to Index)
Showing Etiquette (revised August, 2017)
Always check the “Showing Instructions” AND “Agent Notes” section of the data sheet for complete showing instructions. Basic showing information may be located in the “showing instructions” field on the data sheet but further explained in the “Agent Notes” section of the data sheet. Items such as instructions for Alarm Systems, pets, Showing Times allowable, or time requested for advanced notice may be included here. If in doubt call/email/text the listing office/agent.
Do not contact an owner directly unless the data sheet indicates otherwise.
Always knock, ring the door bell and, or announce as you enter a property.
Do not tamper with equipment (thermostats, alarms, etc.).
Do not leave clients unattended, especially in an occupied property.
Use common sense when showing properties during wet weather. Remove shoes when appropriate. Where requested to use booties or remove shoes always do so.
Please be courteous to homeowners and, unless otherwise instructed, leave the property as you find it. If lights are on in the house when you arrive, you should leave them on when you leave. The owner may have left them on for security purposes or there may be another showing after yours.
If there is a pet in the house, be careful not to let it out.
ALWAYS secure the property upon leaving, even if you find it unlocked upon arrival.
If a home owner has requested a showing agent to sign a register or leave a business card you should do so. Otherwise please do not.
Showing reports are a courtesy to your fellow Realtors and should be readily forthcoming upon request.
Always report any damage or other adverse condition discovered during a showing to the listing agent as soon as possible.
Listing agents should suggest that their client not be present during showings. Buyer agents should limit their contact with a seller and never attempt to negotiate with the seller (of a listed property) directly.
No smoking, drinking, or eating in home or on grounds.
LISTINGS
MLS Data Entry Guidelines (Back to Index)
MLS Data Entry Guidelines (revised August, 2017)
It is important to provide complete and accurate information. Appraisers need details and features in order to be able to provide an accurate opinion of value. Missing, or incomplete entries may also result in the listing not being included in the search results. For example, if a person’s search includes a subdivision name and the entry is “not applicable”, the listing will not show up in the search results. Fill out entire MLS report, including type of financing, (not just "other") basement room count, and provide photo of inside and outside house and any outbuildings. Comments on recent improvements, including flooring types, type of counter tops, roof, windows, or other updating. If pre-sold, please still fill out the MLS report and provide photos and comments. Do not type remarks is all caps.
Follow American National Standards Institute (ANSI) for Gross Living Area. Gross Living Area includes finished and heated space above grade. Enclosed porches which are finished to the same quality of construction as the rest of the dwelling and are heated or have a separate HVAC unit, can be considered in the Gross Living Area.
Finished living space below grade in the basement should not be included in the gross living area, and should be separated out as basement area and finished basement area. Identify rec room, legal bedroom, bathrooms, and other rooms. Typically finished basements have at a minimum of finished drywall / panel walls and finished ceiling and some type of floor covering or stained / coated / finished concrete.
Bathrooms and bedrooms below grade should not be included in the room count above grade, and should be described in the basement room count section.
If there is a homeowners association, lake maintenance dues / fee, or if the property is accessed by an easement or a private road, please indicate that in the comments. If possible please list what the homeowners association dues cover. Same with condos and condo associations.
Sellers Residential Real Estate Sales Discloser – State Form 46234 (Back to Index)
Sellers Residential Real Estate Sales Discloser – State Form 46234 pdf
Sellers Residential Real Estate Sales Discloser – State Form 46234 (revised October, 2017)
I.C. 32-21-5-1 generally requires sellers (including FSBOs) of 1-4 residential units of property to provide a disclosure form to buyers covering known, significant defects in the major systems of a home. It applies to transfers by sale, exchange, installment sales contract, or lease with option to buy residential real estate. This form is not applicable to un-improved property (land).
Sellers should complete the form to the best of “their current actual knowledge”. Each question should be answered individually.
Since the law does not exempt an investor who has never lived in the home, the Sales Disclosure Form IS required in such a situation. Further, even though the seller has never lived in the home, seller does have knowledge regarding the home. The seller must answer the questions to the best of his/her ability, even though the seller may need to check “do not know” on some of the questions. Striking a line through multiple answers or across the entire form is not acceptable.
If a buyer receives a disclosure form or an amended form after offer acceptance which discloses a defect, such buyer has two business days to rescind the offer and receive any deposits made.
REALTORS® should not attempt to complete the disclosure form for the seller. In other words, REALTORS® should not give a seller the opportunity to drag them into court for non-disclosure of a defect or an allegation of misrepresentation.
Exempt from SRRESD:
COMPLETING FORMS
There’s a Form for That (Back to Index)
There’s a Form for That (revised August, 2017)
MLS subscribers are strongly encouraged to use the appropriate form from the IAR State Forms Library for all purposes. In most instances “There’s a Form for That”. Below is a list of some of the forms, addenda, and amendments available from the forms library (Zipforms). This is not a training document. For questions regarding the use of forms, and guidance on office policy, subscribers should consult with their manager.
In most cases, it is wise to reference any addendum or attachment that is part of the Purchase Agreement. The recommended place for this reference is in “Further Conditions”.
Agreement Regarding Personal Property
This form may be used as an alternative to the space on the Purchase Agreement specifying personal property to be included in the sale.
As-Is Addendum to Purchase Agreement
If the property is being purchased and sold “as-is” the addendum provides the purchaser the opportunity to have inspections and to terminate the Agreement if the inspections are not satisfactory. It is recommended not to check either of the boxes pertaining to inspections and to note in further conditions, “Property being purchased and sold as-is, see attached As-Is Addendum to Purchase Agreement”.
Back-Up Offer Addendum
If there is already an accepted offer on a property and a buyer wishes to have their offer held as a “backup” offer, this is the form to use. The backup offer should be negotiated to acceptance between the parties and the back-up offer addendum should be referenced in the offer or on a counter offer form if applicable.
Escalation Clause Addendum to Purchase Agreement
This form is likely to be utilized in situations where multiple offers are present or anticipated. It allows buyers to automatically increase (escalate) their offer to a pre-determined amount should a competing offer exceed their initial offer.
Financing Addendum to Purchase Agreement
In the “Method of Payment” section, when either box E of F is marked, this form should accompany the Purchase Agreement. The purpose of this form is to spell out the general parameters of a contract sale. An attorney would be engaged to draft the actual land contract.
First Right Addendum to Purchase Agreement
For a “contingent offer” whereby the purchaser has the means to purchase the property without necessarily selling their present property. Per MLS rules, if a property has an accepted Purchase Agreement with a First Right Contingency this must be disclosed in the Agent Notes section of the MLS data.
FSBO/Builder Compensation Agreement
If selling a property not subject to a Listing Contract, this form may be used to establish compensation paid to the selling broker.
Limited Purchase Contingency Right
For a “contingent offer” whereby the subject property remains on the market and the buyer removes the contingency upon accepting an offer on their present property.
Multiple Offer Notification
Just like it sounds, a seller may elect to use this form to notify buyers of the existence of multiple offers and to formally request “highest and best” offers from said buyers. Sellers should not make a counter offer to more than one buyer at a time.
Removal of Contingency
Either buyers or sellers may use this form to remove a variety of contingencies. In some cases the removal of a contingency is time sensitive and it’s delivery should be carefully documented and receipted.
Request for Extension of Time for Inspection Response
This is a special purpose form to allow either buyers or sellers to request more time to respond to inspections. This may come into play when inspectors or repair contractors are unable to meet the contractual deadline.
Short Sale Addendum to Listing Contract
For use when listing a property that may be subject to a “short sale” whereby proceeds from a resulting sale may not be sufficient to pay off the mortgage loan obligation.
Short Sale Addendum to Purchase Agreement
For use when submitting an offer on a listing that is known to be subject to approval of a short sale by a third party.
Signature Page Addendum
Ever have more than two buyers or sellers that are a party to an agreement? This form allows you to add signors to an agreement.
Withdrawal of Offer / Counter Offer
In the event an offer or counter offer is withdrawn by a buyer or seller. The withdrawal only applies prior to receipt of written acceptance of said offer or counter offer.
TECHNOLOGY
Cyber Security for REALTORS® (Back to Index)
Cyber Security for REALTORS® pdf
Cyber Security for REALTORS® (revised February, 2018)
Disclaimer
The following are suggested practices to aid with cyber security. The problems and concerns with Internet security are constantly evolving and there is no complete solution or guarantee regarding cyber security. Southwestern Indiana Association of Realtors assumes no liability for any breach of security whether or not the guidelines are implemented. Always consult an expert.
Email Accounts
Your email account is a primary target for hackers and those with nefarious intentions. The following practices will make it more difficult for those types of attacks being successful.
Phishing
Phishing is defined as the attempt to obtain sensitive information such as usernames, passwords, and credit card details (and money), often for malicious reasons, by disguising as a trustworthy entity in an electronic communication (email).
Phishing is typically carried out by email spoofing or instant messaging, and it often directs users to enter personal information at a fake website, the look and feel of which are identical to the legitimate one and the only difference is the URL of the website in concern. Communications purporting to be from social web sites, auction sites, banks, online payment processors or IT administrators are often used to lure victims. Phishing emails may contain links to websites that distribute malware.
The following are good practices to avoid becoming the victim of a phishing type email:
It is a good practice to change your password for your email account periodically. While inconvenient, this may interrupt any nefarious activity associated with your account.
Wire Fraud
There have been many consumers that have fallen victim to wire fraud in Indiana. Hackers use a variety of methods lure victims. These include email phishing, bogus text messages and, in some cases, phone calls. One common scenario involves a hacker sending out a phishing type message to someone involved in a real estate transaction. If the recipient clicks on the link or attachment the hacker gains access to the recipient’s email and is able to monitor communications without being detected. A hacker may lay dormant for any length of time. The hacker may learn who the parties and agents involved in a transaction and will intercept lender and title company information. They will witness negotiations, gain a wealth of personal information, see preliminary settlement statements and, potentially, wiring instructions. This enables them to create and send spoof communications and alternative instructions etc. Keep in mind, even if you employ safe practices, someone else in the transaction may have been hacked or otherwise infiltrated. Keep your guard up at all times.
The following are some steps to follow to minimize the risk of you or your client becoming a wire fraud victim:
General Recommendations
NAR Logos and Trademark Rules (Back to Index)
NAR Logos and Trademark Rules pdf
NAR Logos and Trademark Rules (revised May, 2017)
The National Association of Realtors has strict rules on the use of the term Realtor and the associated trademarks (marks). Many members unknowingly misusing the marks in their business.
A common misuse is using descriptive terminology along with REALTOR to distinguish one member from others. Examples include, “two REALTORS for the price of one”, “number one REALTOR”, “your Horse Property REALTOR”. NAR’s rules prohibit using REALTOR in this manner.
You cannot use REALTOR, or REALTORS in your business name.
You cannot alter the R logo.
The links below provide information regarding the marks and their use:
REALTOR Logos and Trademark Rules
Pocket Reference for Realtors