Wisconsin REALTORS® Association - Legal Hotline Hottips
Legal Hottips - August 25,
2008 Distressed Home Owner Can't Locate Loan Servicer? Working with a seller whose loan is delinquent, who is facing foreclosure and whose loan servicer is nowhere to be found? Looking for potential sources of counseling and help? The Wisconsin Housing and Economic Development Authority (WHEDA) has partnered with nineteen housing counseling agency locations throughout Wisconsin who are part of the HOPE NOW Alliance, a private sector and non-profit alliance between credit and homeownership counselors, lenders, investors, mortgage market participants and trade associations. The 26 servicer members of the HOPE NOW Alliance account for over ninety percent of the subprime market and nearly seventy percent of the prime market. The participating counseling agencies all have direct access to those 26 participating loan servicers so that they often can track down the loan servicer for the homeowner's mortgage. These counselors can also help explore options for the homeowner facing foreclosure and find a solution. Encourage your seller to contact their local nonprofit counseling agency which can help them contact their loan servicer. A list of all 19 counseling agency locations can be found at: http://www.wisconsinforeclosureresource.com/cc.asp. REALTORS® should make sure they obtain a Third Party Release form from the counselor, granting the seller's permission for the REALTOR® to continue dialogue with the loan servicer on the seller's behalf. Landlord Alert Landlord Alert: Names of people requesting restraining orders in domestic abuse cases will no longer be online. Under a new federal law, the names of individuals who ask a judge to issue a restraining order in domestic abuse cases will be removed from Wisconsin court records posted on the Internet. However, the names of individuals who are the subject of restraining orders in those cases will continue to be part of Consolidated Court Automation Program (CCAP) records online. Under a 2006 amendment to the Violence Against Women Reauthorization Act of 2005, no state, Indian tribe of territory "shall make available publicly on the Internet any information regarding the registration or filing of a protection order, restraining order, or injunction in either the issuing or enforcing State, tribal, or territorial jurisdiction, if such publication would be likely to publicly reveal the identity or location of the party protected under such order." In August 2006, Congress further amended the provision by substituting "the registration, filing of a petition for, or issuance of (emphasis added)" a restraining order. See a recent article posted on the Journal Sentinel's
web site at http://www.jsonline.com/story/index.aspx?id=786132. 1.) Agency - Disclosure QUESTION: When a broker is representing the buyer in a transaction, which agency disclosure form should be used? Also, please explain why line 51 of the Broker Disclosure to Customers form has "Buyer's/Tenant's Agent or Buyer's Broker's Agent?" ANSWER: The revised WB-36 Buyer Agency Agreement became mandatory for use effective July 1, 2008. When using this revised Buyer Agency Agreement, the buyer's agent no longer needs to use the separate Broker Disclosure to Clients form. One of the revisions to the Buyer Agency Agreement was the inclusion of the agency disclosure language required by the state statutes. Lines 52 - 122 of the WB-36 Buyer Agency Agreement reflect the proper agency disclosure. The Broker Disclosure to Customers form will continue to be used in transactions when the buyer is a customer or when the seller is a customer. The Broker Disclosure to Customers must be given before negotiation begins. For example, a broker's buyer-client wishes to write an offer on a For Sale by Owner (FSBO) property. The buyer's agent would be required to present the Broker Disclosure to Customers form to the seller/customer before beginning negotiations. Thus, line 51 on the Broker Disclosure to Customers form presented to that seller would indicate that the licensee is acting a "Buyer's/Tenant's Agent or Buyers Broker's Agent." 2.) Landlord/Tenants - Showing Rental Properties QUESTION: Would the agent's sister need a real estate license to show rental properties that are for lease? ANSWER: Rental agents who merely show residential rental property, accept applications and provide information to prospective tenants are not regarded as within the definition of "broker." However, actual negotiations of lease terms or entry into a lease by the rental agent will be acts of real estate brokerage, and therefore require licensure. Unlicensed rental agents or managers must not be paid on a percentage of rentals, but rather on a salary basis. Rental agents must restrict activities to showing units, giving basic information, taking rental applications, and accepting/receipting rental deposits in the form of checks (but not cash). 3.) Listing Contracts - Seller Contact by Other Brokers QUESTION: A homeowner's listing with a competitor will expire on August 31, 2008. This homeowner has asked the agent to come by his house and give him a market analysis before the listing expires with the intent to list with the agent's company. Is this legal because he has invited the agent before the current listing expired? ANSWER: Pursuant to Article 16 of the Code of Ethics, a REALTOR® may not initiate contact with the client of another REALTOR®. However, if the seller contacts the REALTOR®, the REALTOR® may discuss terms upon which they may enter into a future listing contract. Article 16 Standard of Practice 16-6 4.) General Real Estate - Miscellaneous Issues QUESTION: The client has 111 feet of water frontage on Round Lake in Hayward, Wisconsin. The client wants to put in two docks. One dock would be to hold two shore stations, as the DNR allows three boats with 111 feet of frontage. The second dock would be for swimming and lying out on. The broker has not been able to find information on dock/pier regulations, only boat regulations. Please direct the broker to specific information for docks and piers. ANSWER: The DNR "Wisconsin's Pier Regulations" brochure for 2008 is available at http://dnr.wi.gov/org/water/fhp/waterway/factsheets/Piers2008.pdf. Debbi Conrad |