By Gary Thomas, 2013 NAR President
REALTOR® University is one of finest examples of the innovative thinking NAR is doing to meet the needs of REALTORS® in a rapidly changing industry.
REALTOR® University fosters lifelong learning. It is the only institution of higher education focused exclusively on real estate. Entirely online, REALTOR® University is geared toward busy schedules of REALTORS®.
As REALTOR® University begins the second year offering its Master of Real Estate degree program, it is well on its way to meeting its goal of creating the highest standard of professionalism and competency in the real estate industry. Find out more about getting your degree from REALTOR University in my video below.
By NAR 2013 Vice President Leslie Rouda Smith
Before the year 1500, real estate transactions were sealed by “livery of seisin”—the ceremony surrounding conveyance of a property. Closing the deal required the physical transfer of a piece of ground, twig, key, or other symbol on the premises in the presence of witnesses.
Following that custom, paper became the modus operandi and the wet ink signature has been the standard for more than 500 years.
That is until now—the era of technology—when electronic signatures promise easier, speedier, safer transactions for REALTORS® and consumers.
Congress tried to help this along by passing the ESIGN Act of 2000. Its purpose was to support and promote electronic commerce through the use of electronic records and signatures by ensuring the validity and legality of contracts entered into electronically, while preserving consumer protection laws.
Since then, electronic signatures have become much more widely accepted by most financial and lending institutions. E-vendor DocuSign reports 65,000 new users per day (not just in real estate) and expects that number to be one per second by the end of the year. ZipLogix is reporting a 102 percent increase in 2012.
Yet, despite huge growth, many REALTORS® continue to experience problems submitting forms with electronic signatures to servicers of Fannie Mae and Freddie Mac loans, particularly relating to short sales and Real Estate Owned, or REO, properties.
In markets where distressed properties are emerging as the dominant share of the market, completing a transaction under threat of possible default or foreclosure is not unusual. In these instances, the speed and flexibility provided by electronic documents is critical.
I recently took part in a summit, hosted by NAR in Washington, DC, to examine obstacles to increased acceptance of electronic signatures. The meeting brought representatives from government, banking, lending, real estate, and electronic signature providers together for an open discussion.
It was a great opportunity to exchange ideas, and our goals moving forward are twofold. One is to enact government policies that will facilitate implementation of the ESIGN Act. The other is to continue the dialog among all sectors to promote examples of best practices and find additional strategies for eliminating obstacles to full acceptance of E-signatures.
In addition to hosting the summit, NAR has also requested the Acting Director of the Federal Housing Finance Agency, Ed DeMarco to clarify and align Fannie Mae and Freddie Mac’s policies on the broad acceptance of electronic signatures.
The ability to reduce records and documents to digital form and transfer them electronically, when coupled with the Internet, is transforming the commercial world in general, including the real estate world. Not only have electronic sources provided better data faster, but they are an indicator of the need to reduce all documents to digital form.
We believe that, if done correctly, E-signatures can do more than ease transactions. They also offer greater protection against fraud than traditional wet ink signatures.
We’ve come a long way from exchanging dirt and twigs. There is no doubt that electronic signatures are the wave of the future. Catch the wave!
By NAR 2013 Vice President Bill Brown
“Whatever the cost of our libraries, the price is cheap compared to that of an ignorant nation.” That sentiment from Walter Cronkite is being tested as the cost of an education soars ever higher.
The College Board Advocacy & Policy Center’s Trends in College Pricing 2012 report found that overall the average cost of tuition and fees has risen for both public and private schools by over 4 percent, reaching up to $60,000 per year.
A college education helps people get better jobs and gives them a leg up in climbing the economic ladder. But with the high cost of a college education these days, many students have to take out loans to afford tuition.
The result is that students are piling up debt. The New York Federal Reserve reports that total U.S. student debt has almost tripled over the past eight years to reach a total of $966 billion.
The overall number of borrowers past due on their student loan payments has also grown, from less than 10 percent in 2004 to 17 percent in 2012.
The Consumer Financial Protection Bureau (CFPB) raised the issue of whether this debt will have a domino effect on the economy. Their concern is that young people are using a larger portion of their paycheck to pay off debt than for other purposes. This could keep them out of the economy, particularly the housing market.
While approximately 85 percent of student loans are backed by the federal government, the rest are held by private lenders. Now, there is an issue with these private loans. The Fed’s report says the growth in student debt is caused by a combination of more students attending college, more parents taking out loans for their children’s education and a lack of available options for discharging the debt.
While government student loans have options for modifying the loans, (i.e., deferment or making payments a percentage of income) private loans do not. According to the CFPB, they’ve heard from thousands of private student loan borrowers who are willing to make good on their debt, but are seeking a more affordable payment.
The CFPB has issued a “Request for Information” to gather feedback from borrowers, lenders, schools and everyone with a stake in the success of the lending market. As REALTORS®, you’re on the front lines of this issue and will be impacted by whatever the CFPB’s decides.
Please share your stories with us about how student loan debt is impacting sales in your area and, in particular, the impact on individuals. We want to hear from you.