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Weekly Membership Newsletter
November 28, 2017 • Stay Connected!
         

QUESTION:  I have noticed that some listing brokers are issuing the allowed notices on the financing addendum pertaining to "Seller's Request for Loan Information" and the "Right to Terminate Notice" prior to the agreed upon time periods, usually the 10 days or 30 days. One broker issued the notice for loan information the day after mutual acceptance even thought the default period of 10 days was agreed upon. This is causing confusion, concern, and worry with buyers who want to comply as well as selling brokers. If the notice is issued and delivered to the buyer early is it a valid notice? If valid I assume the time period for the buyers to respond starts after day 10 or 30 assuming the defaults were left in place?



ANSWER: Seller's early delivery of the "Seller's Request for Loan Information" and/or "Seller's Notice of Right to Terminate," pursuant to paragraphs 2 and 3 of the Form 22A, Financing Addendum, is contrary to the terms of the Purchase Agreement and renders delivery of the form meaningless. Both paragraphs 2 and 3 of Form 22A say that the relevant form, from seller, will be delivered AFTER the triggering date. Using the default time periods, buyer and seller agree that seller will not deliver the request for loan information until 10 days AFTER mutual acceptance and that seller will not deliver the Notice of Right to Terminate until 30 days AFTER mutual acceptance. Seller's delivery of those forms prior to the date on which seller is allowed to deliver the forms likely makes delivery of the form ineffective.
 
Why is early delivery ineffective? With respect to the Request for Loan Information, the parties agreed that seller will not deliver the form until ten days after mutual acceptance and also agreed that buyer is required to provide the requested information within three days of buyer's receipt of the form. How can buyer be required to provide information to seller at a time that is sooner than seller is even allowed to demand the information? Similarly, with respect to the Notice of Right to Terminate, the parties agreed that seller will not deliver the form until 30 days after mutual acceptance and also agreed that seller can terminate the purchase agreement if buyer fails to waive the financing contingency within three days following seller's delivery of the notice. How can buyer be required to waive the financing contingency in response to seller's notice at a time that is earlier than seller is even allowed to deliver the notice? The answer to both question is that buyer has no obligation, in either case, to act sooner than the time agreed between the parties as part of the terms of the purchase agreement.
 
Should, then, buyer's response period in either case, be three days after the date seller was entitled to deliver the form? There is absolutely no language in the form creating that outcome. Rather, the parties mutually agreed that buyer's response, in both cases, would be triggered by seller's delivery of the form. However, seller has no contractual authority to deliver a form, mandating a response from buyer, sooner than the parties agreed.
 
The only plausible conclusion is that when seller delivers one of these forms sooner than seller is entitled to deliver the form, delivery of the form means nothing. Seller will be required to deliver the form again, at a time when the parties have agreed that seller is authorized to deliver the form and seller's timely delivery of the form will then trigger buyer's three day response period.
 

 

The Legal Hotline Lawyer does not represent Washington REALTORS or its members. To browse through our database of past Q & A's, visit www.warealtor.org. Attorney Annie Fitzsimmons writes the Legal Hotline Question and Answer of the Week. Please submit questions to legalhotline@warealtor.org . Please tell us your NRDS number when you e-mail the Hotline with your question.


 

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Charity Deduction Faces Same Risk as MID
(Source: Speaking of Real Estate) Tax Reform: With all of the other itemized deductions either going away or constrained by new caps, most households will opt for the standard deduction rather than continue to itemize. That renders the tax deduction for charitable giving nearly meaningless...That argument might sound familiar. It’s the same one NAR is making about homeownership. There's still time to tell congress. Take action!
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How FCC Plan to End Net Neutrality Hurts You
(Source: REALTOR Mag) The Federal Communications Commission released a plan Tuesday to reverse net neutrality rules, a move that the National Association of REALTORS® is concerned will make it harder for real estate companies, multiple listing services, and property data aggregators to provide their services in a cost-effective way. 
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Real Estate Wednesdays
Participate in ringing the bells for The Salvation Army during the holiday season! It's a great way for the real estate industry to give back to our communities. Donations support programs throughout the year, including addressing homelessness, emergency assistance, domestic violence shelters, disaster relief and more. Download volunteer details. For more information, contact Lisa Borders at 206-217-1267 or email her at lisa.borders@usw.salvationarmy.org. 
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Last Chance to Apply to the Leadership Institute!
  • Attend sessions on leadership skills.
  • Participate in team-building exercises.
  • Learn goal setting procedures.
  • Identify strengths and weaknesses in a personal profile analysis.
  • Expand on network building.
  • Improve your communication skills.
The deadline is November 30th. Don't miss out on this opportunity for personal and professional development - apply today!
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Mobile Agent
(Source: Inman) The 7 best places to write a contract on the go. Providing better customer service means being more available, being super responsive to questions and being a great communicator; this means knowing the best places to go to write contracts for your clients quickly.

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Client Video:
10 Reason to Sell Your House This Holiday
Keep in touch with your clients this Holiday Season. Here is a short video that you can send to your clients and friends who may be thinking about listing their home. Feel free to use this video on your website, blog, or client emails. Send it to your clients and post on your social media outlets.
 
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Primary Mortgage Rates Survey
(updated every Thursday)  Source:  Freddie Mac
 
 November 22, 2017  30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  3.92%  3.32%  3.22%
 Fees & Points  0.5
 0.4
 0.4
 Margin  N/A  N/A  2.74



 November 16, 2017  30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  3.95%  3.31%  3.21%
 Fees & Points  0.5
 0.5
 0.4
 Margin  N/A  N/A  2.74



 November 9, 2017  30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  3.90%  3.24%  3.22%
 Fees & Points  0.4
 0.5
 0.5
 Margin  N/A  N/A  2.74



 November 2, 2017  30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  3.94%  3.27%  3.23%
 Fees & Points  0.5
 0.5
 0.5
 Margin  N/A  N/A  2.74





 
 
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