Standards of Conduct

Purpose – The Tidewater Real Estate Investors Group, Inc. (“TRIG”) Board of Directors approves this Ethical Policy Statement as being the approved rules and standards of conduct by which our organizations members will properly interact with each other, with the volunteers serving TRIG as well as TRIG’s Officers and Board of Directors and in addition to paying dues when required will be the measurement of how a member will remain in good standing within the TRIG organization. Note – While a membership based organization like TRIG is primarily concerned with “member to member” relationships (as can be clearly seen throughout these provisions), TRIG is also concerned with how members deal with the public and special provision is also taken in these strictures in that regard.

Promulgation and Proper Notice policy – This policy statement will be prominently displayed on TRIG’s web site and will be a required signature item on the membership application for all new and renewing applicants and members. Once enacted this ethical policy statement will be sent out to each TRIG member via an e-mail notice of update. Members will be asked to respond if they cannot abide by the updated ethical policies. Current members not agreeing to abide by the updated standards of conduct will then be asked to attend the next regularly scheduled board meeting to explain their refusal and/or concern. If the Board hears and agrees with the refusing members concern the Board will make their decision accordingly. However, if the Board finds the members complaint or concern to be without merit or contrary to the purpose of the changes to the Standards of Conduct then the Board will advise the member to conform to the changes or be advised their membership will be terminated. Additionally, a copy of the standards of conduct will be maintained at the sign in table area at each TRIG meeting.

Violation and recourse procedure – Members charged with violating a standard of conduct will be notified as per the By-laws protocol and (assuming the issue is not resolved at an earlier point) will have an appointment set at the next regularly scheduled board meeting (assuming there is enough time to notify both parties). If the member then does not show for the meeting or at the hearing appointment the Board decides the complaint has merit, the member so charged can have their membership in TRIG immediately terminated without return of any unused portion of membership dues.

Specific ethical provisions –

1. Advertising policy (i.e., not limited to but to include signs, e-mail, meetings/flyer table, Newsletters, Directory, Message Board, Web site, etc…) – The advertising policy of TRIG must be adhered to (i.e., followed) for a member to remain in good standing (see advertising policy as attached at ____________________________).

2. Stealing deals – Members will not “steal deals” from other TRIG members and still remain a member of TRIG. No exceptions, no warnings.

3. Interfering with member’s deals – Members will not interfere with other member’s deals and contracts. The definition of “interfere” means that one member has now come into a 2 party situation as the 3 rd party and tries (in one manner or another) to cut out the initial TRIG member which otherwise means to get the initial TRIG member out of the deal without the compensation expected and/or due. This also includes the following:

• Members will not interfere with another member who has a valid contract with a seller.
• Members will not interfere with another member that has a property listed for sale.
• Members will not interfere with another member that has any other form of written contract with the seller/property owner including contractors, property managers and other service providers excepting institutional lenders.

4. Dues and member payment for TRIG services – Members and/or applicants who pays for a TRIG service or dues where the check or form of payment is refused by the applicant/members bank will be dealt with as follows:

• An applicant whose payment is refused by their bank will have their form of payment returned to them while also notifying the applicant that they will need to reapply and use certified funds as well as pay the NSF bank fee in addition to the membership fee.
• A member whose annual dues payment is refused by their bank will follow the same notice provision as in 4a. above but will not lose their membership benefits unless their annual membership period has already expired.
• A member in good standing whose payment for other services or TRIG events whereby their payment is refused by their bank will get one written/e-mail notice to sure the default and if not will have their membership good standing status reviewed by the board of directors at the next regularly scheduled board meeting for determination of continued membership status. The “in default” member otherwise in good standing will be notified to attend the meeting if they want to have their side of the issue considered or to pay the default amount with certified funds.

5. Prohibition against a member borrowing money to buy, maintain or fix-up real estate or mobile homes or real estate related businesses but then uses it for other than the stated and/or intended purpose. This provision is not intended to say that members that enter into a lending arrangement that then fails to work out due to market forces beyond the control of the members are somehow unethical. However, even when a deal does not work out where everyone makes money, a member can still act honorably by spending the loan money on the property fix-up and/or payments (in the manner it was intended) rather than using the money for “living expenses” or other properties, etc… Members that find themselves in this situation should also be willing to:

• Sign over a deed in lieu of foreclosure rather than force a lender to foreclose.
• Turn over to their lender (at point of deed transfer) any tenant security deposits, pro-rated tenant rents and anypaid for but unused building materials incidental to the loan/rehab, etc…
• Otherwise cooperate with their lender in any reasonable manner requested.

Summary – It is noted that members will continue to borrow money and that from time to time deals will not always work out as planned but members are cautioned that they must take care to not breach the trust of the member individual lenders and to a lesser degree other institutional lenders. Additionally, it is noted that a straight forward foreclosure in itself is not considered a breach of ethics but is part and parcel of active investors taking risks for greater rewards.

6. Meeting protocol – As the By-laws and Board Resolutions determine how meetings and events will be operated, the Standards of Conduct determine how members treat each other and to a lesser degree, treat the public. Of particular note, members need to be aware that TRIG is run by volunteers, not paid staff and accordingly, these hard working volunteers deserve members and guests courteous and respectful treatment. Specifically:

• Guests and Visitors may be refused entry by the authorized officer, chairperson or volunteer in or at/around the meeting sign-in table especially if the guest or visitor is rude or disrespectful or will not follow directions.
• Additionally, if a member or guest/visitor is showing the signs of being under the influence and acts in a disruptive manner then member or not they may be refused entry to the meeting.
• All officers, chairpersons, board members and sign-in table members are volunteers working for you for free and therefore deserve your courtesy and thanks for their service.
• Guest Speakers Protocol – Guest Speakers have graciously agreed to come and speak to the membership and therefore deserve your courteous behavior and polite questions. Members will not “compete” with the Guest Speaker on the subject the speaker is speaking on that meeting night.
• The Advertising Policy will be adhered to at all meetings .

7. Dealing with homeowners, Sellers and the public – When a member does business with a member of the public, another investor, or a seller, the ethics of the situation merely state that you should do what you have said you will do. This provision does not mean that buying a property “subject to” is or will be an ethical problem for a TRIG member as long as the TRIG member keeps the loan current and otherwise performs as per the agreement with the seller. However, if the member subsequently finds that they cannot keep up the property, the loan, etc… due to extenuating market forces or even poor decision making on the member-buyers part, this still does not make the member unethical as long as they quickly transfer the property back to the subject to or owner financing seller, so the seller’s credit does not suffer further damage and so the public perception of real estate investors as well as TRIG is maintained to the highest possible degree. Other ethical issues include:

•  Not providing full written disclosure to sellers of:

1. Your qualifications as a licensed real estate agent, attorney, CPA or lender/lending employee or contractor.
2. Your intention to actually buy the property.
3. Your intention (if applicable) to have the loan remain in the sellers name as a subject to purchase.

• Purchasing a property and allowing the sellers to remain in the property with the right to repurchase the property.
• Lending money to homeowners on their principal residence especially with the intention of then acquiring the property via a subsequent foreclosure.
• Using deceptive and unfair trade practices (i.e., bait and switch tactics) that advertise “foreclosure rescue scam” type wording such as “Save your home/house”, “Keep your house”, “We will rescue/save you”, “Foreclosure Rescue” or some other similar language that is not straight forward such as “We Buy Houses”, “I Buy Houses”, “Cash for your House”, etc…
• Acting or inducing others in the transaction to act in a fraudulent manner as part of the purchase/sale process.

8. Other member to member issues – Members will not spam other members in any regard whether this is by telephone, fax, e-mail, letter, etc… UNLESS they have first established through personal contact at meetings or via other public information showing the member was openly soliciting such “bring me a deal or bring me training/information” type advertising. In no case will members use the TRIG Directory (or otherwise allow the Directory to be used) for spamming and/or advertising to the membership.

Agreed to and voted into being by a majority of a quorum of the Board of Directors regularly scheduled meeting on January 7th, 2008.