Is Your REALTOR Using The Correct Forms?


By Travis Close, ABR, GREEN, GRI, e-PRO, President

Greater Chattanooga Association of REALTORS®

The last few years, I have served as a member of the Tennessee Association of REALTORS®’ (TAR) Residential Forms Committee. Currently, I serve as vice-chairman of the Committee, which is comprised of REALTORS® and attorneys from across the state. We meet several times a year to review and recommend changes in the verbiage in standardized forms and contracts used by Tennessee REALTORS®.

Especially after the annual release of updated forms, I often am asked whether REALTORS® are required to use the TAR forms. My response – it depends.

Neither the Tennessee Real Estate Commission (TREC) nor the TAR mandate the use of any forms or contracts. Rather, TAR provides these forms as a service to REALTORS®, who, by virtue of their local association membership, also are members of the state association.

There are times that TAR adds or deleted certain verbiage to reduce risk for REALTORS® using the forms and to protect the best interest of the clients and customers being served by a REALTOR® using these forms. Many times there changes to the TAR forms that are a result of changes in the market and how business is conducted. Many times changes in the law, TREC rules and/or policies or even case law result in changes to TAR forms.

To reduce risk, it is the responsibility of REALTORS® to use the most current version when using TAR forms. By using previous versions, the REALTOR® is voluntarily subjecting himself/herself to possible legal issues that may arise that changes to the forms may have fixed. Thus, many REALTOR® firms have adopted a policy requiring all their REALTORS® to use the most recent version of the TAR forms. Absent a state-wide mandate, what should a REALTOR® do when presented with an offer on an “old” form? Present the offer.

The Tennessee Broker’s Act (Tenn. Code Ann. § 62-13-404(3)(A)(ii)) states, “Unless the following duties are specifically and individually waived, in writing by a client, a licensee shall assist the client by receiving all offers and counter-offers and forwarding them promptly to the client.” In addition, TREC Rule 1260-2-.08 states, “A broker or affiliate broker promptly shall tender every written offer to purchase or sell obtained on a property until a contract is signed by all parties.” In short, a licensee must present all offers to the client unless the client has provided written instruction to the licensee not to do so.

Also, the REALTORS® Code of Ethics Standard of Practice 1-6, requires, “REALTORS® shall submit offers and counter-offers objectively and as quickly as possible.” Thus, one option is for the REALTOR® to communicate with the seller about the value in using current TAR forms. And if so directed by the seller, complete the buyer’s offer on the current forms and include any changes that the seller wants and send it back to the buyer’s REALTOR®. The buyer can then counter with any changes he wishes. This suggested course of action is exactly backwards from the norm in that a seller is, in essence, making the offer, but it is legal and ethical.

As REALTORS®, we pledge to “protect and promote the interests of their client.” At last count, nearly 80% of all Tennessee licensees also are REALTORS® and have access to the TAR forms. Despite variations across the state in local market practices, using current forms provides consistency and reduce risks for REALTORS® and their clients.

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