Read Get the Facts including the Legal Hotline Q & A
Get the Facts is a Membership update sent to Washington REALTOR® members and contacts each Tuesday.  
Click here if you are having trouble viewing this message.
 
Weekly Membership Newsletter
May 22, 2018 • Stay Connected!
         

QUESTION:  Is a broker required to submit transaction paperwork for rejected offers and offers that are rejected as a result of no response to their managing broker/company? Is the Brokerage required to review and maintain the following transaction paperwork for rejected offers and sale fails?



ANSWER:  WAC 308-124C-140 answers this question with respect to broker responsibilities. The WAC says:
 
"Broker responsibilities include, but are not limited to: ... (7) Delivering transaction documents and brokerage service contracts to designated broker or delegated managing broker within two business days of mutual acceptance. ..."
 
With respect to the firm's obligation, WAC 308-124C-105 says:
 
"The designated broker is required to keep the following on behalf of the firm: ...(2) Other records: (a) An accurate, up-to-date log of all agreements or contracts for brokerages services submitted by the firm's affiliated licensees. (b) A legible copy of the transaction or contracts for brokerage services shall be retained in each participating real estate firm's files. (c) A transaction folder containing all agreements, receipts, contracts, documents, leases, closing statements and material correspondence for each real estate or business opportunity transaction, and for each rental, lease, contract or mortgage collection account. ..."
 
Based on these regulations, which are the controlling authority with respect to the questions asked, brokers are not obligated to submit transaction documents where a buyer's offer is rejected for any reason, because a broker's obligation to surrender documents arises two days after MUTUAL ACCEPTANCE. If mutual acceptance is never reached, the law creates no obligation on brokers to surrender documents to broker's managing broker.
 
With respect to the firm, it must first be understood that a firm cannot maintain documents that the firm never possesses and since brokers are not obligated to surrender offers that never reach mutual acceptance, there can be no obligation on firms to maintain those documents.
 
That said, the WACs do require firms to maintain a log of all "all agreements or contracts for brokerage services submitted by the firm's affiliated licensees." This means that the firm must maintain a log that references all listing agreements, buyer agency agreements, PSAs and BPOs. The purpose of the log is that a DOL auditor should be able to enter the firm, review the log and then demand production of a related "transaction file".
 
While the law does not require a firm to collect or maintain rejected offers or maintain transaction files on sale failed PSAs, many firms have office policies requiring brokers to submit all of these documents to the managing broker for retention by the firm. The reason for these office policies is to provide protection to the firm, and the brokers, in the event allegations are asserted, in the future, about something that happened in the sale-fail or rejected offer process. If the firm has its old file, the firm can use information from the file to defend itself and its brokers. If the file has been discarded, however, then the firm and the broker will have no documentation to use in their defense. It is presumed that file documentation will serve to protect the firm and the broker. This is more likely true if DBs demand that brokers surrender all material communications relevant to transactions, for retention in the file. So often, disputes revolve around a "he said, she said" scenario and if a broker can prove evidence of a conversation that lead to a series of events that are described differently by the broker and the consumer, then broker's and firm's defense may be bolstered. This outcome is equally true in transactions that close and in relationships where parties are frustrated because of rejected offers and sale fails.

 

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.


 

Thank you, Corporate Sponsors!

  


  
 
House Passes Dodd-Frank Reform Bill,
Approval Now Pending From the President
(Source: HousingWire) On Tuesday afternoon, the House of Representatives passed S. 2155, also known as the Economic Growth, Regulatory Relief and Consumer Protection Act. The bill rolls back reforms from the 2010 Dodd-Frank Act...
More →
  
  
  
 
.Realestate Domains Are Coming This Fall
(Source: NAR) The National Association of REALTORS® has announced it will be launching a new top-level internet domain, .realestate, later this year. The new domain will be available to members of NAR starting in September, and then offered to the general public in late November.
More →
  
  
  
 
Join Team WR!
The REALTORS® Relief Run is a 5k Run/Walk/Cheer at the National Association of Realtors® 2018 Conference to benefit the REALTORS® Relief Foundation. The race starts & finishes on the Boston Common, which dates back to 1634 and is a national historic landmark as the oldest city park in America. Washington REALTORS® has started a team! Join #TeamWR today. Walk, run, or cheer the crowd on. There's something for everyone.
More →
  
  
  
 
How to Detect Wire Fraud Before it is Too Late
(Source: HousingWire) Wire fraud victims have few options once they discover they’ve been had. But when minutes mattered, one Michigan homebuyer enlisted the help of a few friends—and made a recovery. What follows is an actual instance of mortgage wire fraud. Here's how it got detected, before it was too late.
More →
  
  
 
Tech Advice - How Safe Are Your Passwords?
(Source: Tech Helpline) When Yahoo! reported that someone hacked one billion of its accounts, it was a stunning revelation. Then it disclosed last fall that the names, dates of birth, email addresses, passwords and security questions and answers were compromised on all three billion of its accounts. For many, this news was devastating. That’s because the vast majority of us use the same password or too close a variation of the same password for everything we access.
More →
  
  
 
Primary Mortgage Rates Survey
(updated every Thursday)  Source:  Freddie Mac
 
 May 17, 2018       30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  4.61%  4.08%  3.82%
 Fees & Points  0.4
 0.4
 0.3
 Margin  N/A  N/A  2.77



 May 10, 2018       30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  4.55%  4.01%  3.77%
 Fees & Points  0.5
 0.4
 0.3
 Margin  N/A  N/A  2.76



 May 03, 2018       30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  4.55%  4.03%  3.69%
 Fees & Points  0.5
 0.4
 0.3
 Margin  N/A  N/A  2.76



 April 26, 2018       30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  4.58%  4.02%  3.74%
 Fees & Points  0.5
 0.4
 0.3
 Margin  N/A  N/A  2.76



 April 19, 2018       30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  4.47%  3.94%  3.67%
 Fees & Points  0.5
 0.4
 0.3
 Margin  N/A  N/A  2.76



 April 12, 2018       30-yr FRM  15-Yr FRM  5/1-Yr ARM
 Average Rates  4.42%  3.87%  3.61%
 Fees & Points  0.4
 0.4
 0.3
 Margin  N/A  N/A  2.76



 
 UPCOMING CLASSES
Date Class Location CE  
23-MAY At Home With Diversity Olympia7.5More info...
29-MAY To Disclose or Not to Disclose Wenatchee3.5More info...
29-MAY Best of the Legal HotlineWenatchee4.0More info...
30-MAY CORE & MoreKennewick7.5More info...
13-JUN Code of Ethics in Real LifeChelan3.0More info...
13-JUNCode of Ethics in Real LifeE.Wenatchee3.0More info...
21-JUNThe Hotline Vs. The Bottom LineShelton3.5More info...
21-JUN To Disclose or Not to DiscloseShelton4.0More info...
26-JUN NAR Code of EthicsBellingham3.0More info...
27-JUN NAR Code of EthicsOlympia3.0More info...
29-JUN NAR Code of EthicsPuyallup3.0More info...
     


More Classes →


  
 
Heads Up! Code of Ethics Cycle Ending
REALTORS® are required to complete ethics training within two-year cycles and the deadline for the current cycle is December 31, 2018. Training may be completed through your local REALTOR® association, via one of upcoming WR webinars (stay tuned for dates) or you can take it online. A few online options include NAR's online training or Interact CE's Ethics Adventure
More →
  
  

Expires on: 11:59PM PST 05/31/2018 
Promo Code: RELAX  Expires on: 11:59PM PST 05/31/2018 Discount amount: 27%  Restrictions: Cannot be combined with any other offer. Can use as entire cart discount or individual products. Unlimited use until expiration date. Does not apply to Ethics Adventure products.