You are receiving this email because of your relationship with Washington Association of REALTORS. June 17, 2014 Stay Connected! Hotline Attorney Annie Fitzsimmons writes the Legal Hotline Question and Answer of the Week. Please submit questions to legalhotline@warealtor.org or call (800) 562-6027. Please have your NRDS number ready when you call or e-mail the Hotline with your question. The Legal Hotline lawyer does not represent Washington Association of REALTORS members or their clients and customers. Research this topic and thousands of others online. 1 of 10 6/17/14, 1:27 PM

Question: Recently, Form 22A, the Financing Contingency Addendum was revised to include a new paragraph at the bottom of paragraph 2. New Paragraph 2C says: "Appraisal Less Than Sales Price. Buyer's waiver of the Financing Contingency under this Paragraph 2 will; or will not (will, if not filled in) constitute waiver of Paragraph 6 (Appraisal Less Than Sales Price)." What is the purpose of this new provision? How should it be used? Answer: Understanding this new paragraph starts with an understanding of paragraph 2 generally. Within paragraph 2, seller is given the right to send buyer a Notice of Right to Terminate following passage of the specified number of days after mutual acceptance. Upon receipt of the Notice of Right to Terminate, buyer may either waive the financing contingency or take no action at all. If buyer waives the financing contingency, within three days following receipt of the Notice of Right to Terminate, the parties proceed to closing and buyer no longer has the protection of the financing contingency. If buyer does not waive the financing contingency, then following three days after delivery of the Notice of Right to Terminate, seller may terminate the purchase agreement by giving buyer a Notice of Termination but seller is not required to give buyer any additional advance notice of the termination. Seller retains this right to terminate without advance notice until such time as buyer waives the financing contingency. All of this information is background for the answer to the question that was asked. The new sentence affects what happens if buyer waives the financing contingency. Prior to this new paragraph being added, when the buyer waived the financing contingency, buyer's waiver would include a waiver of the low appraisal provision. Said differently, if buyer waived the financing contingency in order to keep seller from terminating the agreement, buyer's waiver would waive the protection of the low appraisal provision. If buyer thereafter received a low appraisal and could not get the loan as a result, buyer would breach the purchase agreement. This new paragraph allows the parties to negotiate whether buyer's waiver of the financing contingency, triggered by seller's delivery of the Notice of Right to Terminate, will also waive the protection of the low appraisal provision. If the parties check the "will" box, buyer's waiver of the financing contingency will also waive the protection of the low appraisal provision. If the parties check the "will not" box, buyer's waiver of the financing contingency, will not waive the low appraisal provision. More succinctly, checking the "will" box favors seller. Checking the "will not" box favors buyer. Prior to inclusion of this new paragraph, some buyer brokers would try to achieve the objective of the "will not" box by including a Form 22AA along with Form 22A in buyer's offer. If the parties agree to the "will not" box, then there is no reason for buyer to include 22AA in an offer that also includes Form 22A. For a printer friendly version of this week's Legal Hotline Q & A, click here. 2 of 10 6/17/14, 1:27 PM

REALTOR Career Help We have scanned and selected interesting tips & tricks articles from a variety of industry publications so you don't have to. Always check with your broker/owner to see if these practices fit within your company policies. Social Media Cheat Sheet - Pts. 1 & 2 This two part article, partly based off information brought to you from a recent Watercooler eipisode, offers up some really great strategies to help you not feel overwhelmed by social media. Part one talks about Fun with Facebook and the Power of Photos. Part two addresses Reputation Management, Organization and Instagram Tips. Sunrise App Lets You Connect Calendars Connect Google Calendar, icloud, Exchange, and more. In the latest release, you can connect Evernote, Tripit, Github, and more as well. The app also works with your Desktop. Read the review from Tech Crunch. Get Sunrise here: Desktop Access, GooglePlay, itunes 3 of 10 6/17/14, 1:27 PM

Top Stories Pocket Listings Recently, Legal Hotline Lawyer Annie Fitzsimmons wrote an article about the destructive force of Pocket Listings, a topic that's really gaining traction as of late. In her article, Annie discussed that the potential risks of pocket listings are great, possibly exposing brokers to license law violations and civil liability... Homeowners Capitalize by Becoming Landlords The headlines of the last few months tell the story. Mortgage rates are still low and rent continues to climb. And now homeowners are beginning to take advantage of the market conditions by becoming landlords... Even though home sales decreased on a year over year basis, the average price of homes sold continued to increase. 4 of 10 6/17/14, 1:27 PM

Mortgage National Averages 30-Yr FRM 15-Yr FRM 5/1-Yr ARM 1-Yr ARM Average Rates 4.20% 3.31% 3.05% 2.40% Change (from prior week) +0.06% +0.08% +0.12% ----% Fees & Points 0.6 0.5 0.4 0.4 Margin N/A N/A 2.74 2.71 Regional Averages (West) 30-Yr FRM 15-Yr FRM 5/1-Yr ARM 1-Yr ARM Average Rates 4.16% 3.25% 2.86% 2.13% 5 of 10 6/17/14, 1:27 PM

Change (from prior week) +0.06% +0.06% +0.07% ------% Fees & Points 0.6 0.6 0.5 0.6 Margin N/A N/A 2.69 2.67 Source: Freddie Mac - Weekly mortgage rates released every Thursday. Freddie Mac's Primary Mortgage Market Survey Government Affairs Eliminating Discrimination in Calculation of Fees & Points House Passes "The Mortgage Choice Act" The U.S. House of Representatives passed H.R. 3211, or "The Mortgage Choice Act." This Bill addresses discrimination in the calculation of fees and points under the QM rule. The Bill now heads to the Senate. REALTORS continue to advocate for this legislation as it heads to the Senate in order to help clarify QM rules while protecting borrowers from risky loan products. Read NAR President Steve Brown's statement here. Education For your convenience, Washington REALTORS Education offers both online education and live classes, including webinars! To participate in a webinar, all you need is internet access and a phone. For more information, or to sign up for classes, visit www.warealtor.org/education. Coming Soon! Mark Your Calendars! Washington REALTORS premier education event, edcon, is back and better than ever! Mark your calendars to attend this education conference and vendor showcase October 7th-8th, 2014 at the Hilton Seattle Airport & Conference Center. Stay tuned for more information! 6 of 10 6/17/14, 1:27 PM

Upcoming Live Classes JUNE 18 Water Rights & Legal Issues TRI CITY 3.5 CE Instructor: Bill Clarke This class provides an overview of the water availability requirements for local governments related to approval of land subdivision and building permit applications, and an explanation of the process to obtain water supply either from existing water systems, through the water rights permitting system, or using a private well. The class also includes information on the water supply issues within the seller disclosure law, and how information on water rights can be obtained from the Department of Ecology...REGISTER JUNE 24 Pinterest for REALTORS WEBINAR 3.5 CE Instructor: Terry Eccles-Pettet, ABR, CRB, GRI, epro, REEA member Pinterest is fun! Pinterest is also a great social media marketing tool for REALTORS. Why use Pinterest? Its the third largest social network after FaceBook and LinkedIn. Using Pinterest you can become better connected with your warm market, develop your digital persona, and share your expertise and interests in a non-spammy way. Come see what all this pinning is about...register JUNE 26-27 Certified Negotiation Expert EVERETT 15 CE Instructor: Pili Meyer, ABR, CRS, GRI, SRES, e-pro Learn how to proactively plan your real estate negotiations for success by learning difference between win-lose hard bargaining vs. collaborative win-win negotiating. Learn how the brain makes purchase decisions and how you can impact both sides of the brain in the decision making process and review scientifically proven persuasion approaches that increase your success rate at influencing others. This class includes scripts for real estate negotiation situations that utilize these proven persuasion approaches...register More Upcoming Live Classes... July 10 Legal Aspects of RE Technology & Intellectual Property TRI-CITY 4.0 CE Instructor: Doug Tingvall, JD, GRI MORE INFO OR TO REGISTER 7 of 10 6/17/14, 1:27 PM

July 16 Peas and Carrots TUKWILA 7.5 CE Instructor: Terry Eccles-Pettet, ABR, CRB, GRI, epro, REEA Member MORE INFO OR TO REGISTER July 17 Current Issues - Webinar WEBINAR/OLYMPIA 3.0 CE Instructor: Michael R. Schoonover, ALC, Auctioneer MORE INFO OR TO REGISTER July 31 CORE & More ORCAS ISLAND 7.5 CE Instructor: Annie Fitzsimmons MORE INFO OR TO REGISTER August 27 VA & Military Real Estate Specialist (VAMRES) YAKIMA 7.5 CE Instructor: Pili Meyer, ABR, CRS, GRI, SRES, e-pro MORE INFO OR TO REGISTER For a complete list of classes, visit www.warealtor.org/education... Thank You, Sponsors! 8 of 10 6/17/14, 1:27 PM

Get the Facts Best of the Legal Hotline Q & A Question Buyer and seller have already reached agreement with respect to pre-closing rents and other purchase agreement terms. Now, seller wants buyer to modify those agreements. The modifications appear to disfavor buyer. Must buyer agree to modify the terms? Click here for the ANSWER! Hotline Attorney Annie Fitzsimmons writes the Legal Hotline Question and Answer of the Week. Please submit questions to legalhotline@warealtor.org or call (800) 562-6027. Please have your NRDS number ready when you call or e-mail the Hotline with your question. The Legal Hotline lawyer does not represent Washington Association of REALTORS members or their clients and customers. Research this topic and thousands of others online. Member Resource Quick Links Please have your NRDS number and password ready when you access some of these links. Stay Connected! 9 of 10 6/17/14, 1:27 PM

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