DISTANCE LEARNING ON DEMAND - WRA

Welcome to the Wisconsin REALTORS®Association’s Distance Learning On Demand! Distance Learning On Demand is the most convenient method available from the WRA to complete your continuing education requirement.

The course is broken into chapters varying in length from 20 to 40 minutes. At the conclusion of each chapter video, you will be required to complete a short quiz. Each chapter video must play through from start to finish or you will not be able to advance to the next section. If you do not pass the quiz, you will need to wait 1 hour to re-take the quiz. Once all the chapters and corresponding quizzes are complete, you will be able to advance to the final exam. After you pass the exam, you can print your certificate of completion. If you do not pass the exam, you will need to wait 4 hours to re-take the exam.

Here are a few suggestions for completing the courses as efficiently as possible:

1. Ensure you meet the system requirements at the location where you plan to view your videos. Requirements can be found at: www.wra.org/dlodreq

2. Close all other software applications.3. Make sure only 1 copy of the video player is open.

Accessing your videos:

1. You will be able to re-access courses via myWRA at: www.wra.org/mywra

We have addressed other questions and concerns on the Frequently Asked Questions below.

Thank you for choosing the WRA for your continuing education needs!

FREQUENTLY ASKED QUESTIONS

Can I watch chapters out of order?No, each chapter video will be locked until completed. However, you will have the ability to watch them in any order after completion.

How do I switch to a new chapter?After you complete a chapter, the next available chapter will be highlighted in green. Simply click the highlighted chapter to begin. Please note that you must complete each chapter video and quiz to advance to the next chapter.

What are quizzes?The quizzes are a required part of Distance Learning On Demand. You must complete the quizzes before advancing to the next chapter. Each chapter has a bank of two questions. To take a quiz, simply click the quiz icon. Once you’ve taken and passed a quiz, the icon will show a check mark to verify completion.

RW ADISTANCE LEARNINGW AON DEMAND

Chapters Tab

What is the difference between a quiz and exam?Quizzes are mini-exams comprised of two questions. You must complete all quizzes before taking the final exam. The exam is your final test. You can take your final exam after you’ve completed watching all chapters and have taken all quizzes. Once you’ve passed the exam you will receive your certificate.

How do I take a quiz?In the “Chapters” tab in the far right column, find a label for “Quiz.” After completing the chapter video simply click the chapter quiz icon to proceed. Each quiz includes two questions.

How do I know if I passed all quizzes?In the “Chapters” tab, far right column, find a label for “quiz.” When you have completed a quiz, a checkmark will appear in the Quiz icon. If your icon is still locked or highlighted, you still need to complete that quiz before proceeding to the next video and/or final exam.

What is the “Notes” tab for?

The “Notes” tab is a place for you to take your notes on screen without leaving the video interface. If this functionality were not available you would need to take your notes manually. These WILL automatically save for you. You may want to print your notes and attach them to the outline for future reference.

What is the “outline” tab for?The “Outline” tab is an easy way to access a specific topic in a chapter. Simply click a link in the outline and you can instantly access the corresponding content in the video. It’s perfect for accessing a topic you would like to re-watch.

Exam Tab

Notes Tab

Outline Tab

I have no volume/sound.To troubleshoot sound, perform the following steps:

1. Can you hear sounds from other Windows applications?2. Make sure the volume slider in the player is turned up.3. Access your volume control panel in Windows (Accessories, Entertainment, Volume Control) and ensure

your sound is not muted.4. Double check your speaker connection in the back of the sound card, making sure it is plugged into the

right port.5. If all tests fail and you still do not have sound either from the player or other Windows-based applications,

contact your local computer technician.

My video is stuttering, pausing and stopping. How can I fix this problem?1. It is likely you are short on bandwidth. Internet Service Providers (ISPs) can have times when traffic is at

a maximum; thus slowing your connection. The WRA provides other feed options you can access that requires less bandwidth. To drop bandwidth, use the drop down box located under “Help” in the upper right-hand corner of the Media Player. The default bandwidth is 1000kbps.

2. Press the F5 key on your keyboard to refresh the player.3. Log-out of the website, then log back in.

If after dropping bandwidth you do not see an improvement in performance, what can I try next?1. Re-test your bandwidth making sure your download speed is at least 512 Kbps by following this link:

www.wra.org/bandwidthcheck2. Try connecting to a landline. Often wireless connections do not run smoothly which causes the video to

continuously stop-and-start.3. Try switching computers to see if you get the same result

Other Problems?For other problems please call the Wisconsin REALTORS® Association at 1-800-279-1972.

Troubleshooting

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2011-2012 Real Estate Continuing Education Program

Elective D - Financing

During the 2011-2012 licensing biennium, Wisconsin real estate licensees must complete 18 hours of continuing education to be eligible for license renewal. To remain active, licenses must be renewed by December 14, 2012. Successful completion of the required continuing education may be accomplished by taking six Wisconsin approved courses worth three credit hours each. Licensees must take four mandatory and two elective courses and pass an examination for each course. The Wisconsin REALTORS® Association offers a total of eight continuing education courses to choose from, all of which are Wisconsin approved for license renewal requirements for the 2011-2012 biennium.

Licensing Renewal

A licensee, when submitting a license renewal application, must show completion of 18 hours of Wisconsin approved continuing education. Persons granted an original broker or salesperson license during the 2011-2012 biennium are not required to complete continuing education during the 2011-2012 licensing period. Only courses approved for 2011-2012 may be applied for credit. This course and exam qualifies for three hours of the required continuing education.

To apply for license renewal by December 14, 2012, a licensee must submit the course name, the course provider, and the date of successful completion of each continuing education course completed. At the time of renewal, licensees do not have to submit Certificates of Completion with the application. Wisconsin conducts audits of license renewals. Selected individuals will be asked to produce documentation in the form of a Certificate of Completion for each continuing education course.

Duplicate Certificates

Requests for a duplicate WRA course Certificate of Completion must be made within 60 days of completing a course. Requests for duplicate certificates made more than 60 days after completion must be in writing, accompanied by a $10 fee, and submitted to the Wisconsin REALTORS® Association, 4801 Forest Run Rd., Suite 201, Madison, WI 53704-7337. Individuals may print duplicate certificates free by logging into myWRA at www.wra.org.

Additional Resource

Answers for questions presented in this outline are available at http://www.wra.org/Education/Online/RECE/Real_Estate_CE_Exam_Practice_Questions/. Select the biennium followed by the PDF document for the desired course.

Special acknowledgement to the WRA Legal Department for the use of various Legal Updates, Hottips, and other WRA co-authored and sponsored publications.

The information and materials contained in this product are provided exclusively for educational purposes and are solely intended to be statements of general legal principles. The information and materials are not to be construed, interpreted,

relied upon or used as legal advice in any fashion, including but not limited to, use in litigation, arbitration, ethics matters or other administrative proceedings. Individuals seeking legal advice should obtain private legal counsel and should not rely upon the

information and materials contained herein.

Copyright 2011 by

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EElective D- Financing

I. Changes in financing practices, regulations and increased scrutiny in lending affect buyers, sellers, and licensees. a. Buyers

i. Changes in the housing market have led to increased scrutiny by lenders when evaluating a borrower’s requests for financing.

ii. Buyers are facing challenges obtaining financing even if they have good credit histories.

iii. The increased scrutiny is the response to the implosion of the housing market due to over lending to unqualified buyers during the most recent housing boom.

b. Sellersi. Sellers are affected by the increased scrutiny in lending. ii. Sellers are having a more difficult time finding buyers who have funding to finance

the sale. iii. Sellers are also being forced to sell their homes because they are unable to get

refinancing through their lenders leading to defaults on loans and consequential foreclosures or short sales.

c. Licenseesi. Licensees are affected by both the conditions affecting buyers looking for financing

and sellers looking for buyers.ii. There are fewer buyers who are able to qualify for financing to purchase licensees’

listed properties. iii. There are more listings as homeowners decide to sell because they can no longer

afford their mortgages and have limited opportunities to refinance existing loan obligations.

d. Goals of the coursei. Review the financing and appraisal contingencies in the WB – 11 Residential Offer

to Purchase and the effects on buyers, sellers, and licensees. ii. Outline the general process for buyers seeking lending for a property. iii. Provide licensees with an understanding of seller financing issues including a

seller’s options to finance a sale and accepting offers contingent on financing and appraisal.

iv. Provide an overview of the difficulties licensees are facing because of the financing challenges for buyers and sellers.

v. Familiarize licensees with alternative lending sources. vi. Review new developments in financing regulations.

II. A Buyer’s Financing a. The financing contingency

i. Buyers using the WB - 11 Residential Offer to Purchase can make their offers contingent upon receiving acceptable financing using the financing contingency.

ii. The contingency permits buyers to describe the loan they hope to receive from a lender to finance the purchase of the home for which they made the offer.

iii. The WB – 11 financing contingency permits a buyer to name the loan source, the amount financed, the term or length of the loan, the maximum amount of monthly principle and interest, and the maximum fixed or adjustable interest rate.

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1. These provisions describe the financing that will be acceptable to the buyer. 2. They also determine the terms upon which a seller may finance the transaction

if the buyer cannot obtain financing from a lender. iv. If a seller accepts a buyer’s offer that includes a financing contingency, a buyer

agrees to pay all customary loan and closing costs, apply for the described financing, and provide evidence of the loan application upon a seller’s request.

v. Satisfying a buyer’s financing contingency1. The loan commitment

a. A loan commitment is an agreement by a lender to lend money to a buyer.b. A buyer’s financing contingency will be satisfied if a buyer delivers

to a seller a loan commitment even if the loan commitment contains contingencies.

c. If a buyer does not timely deliver a loan commitment, the seller can terminate the offer.

d. Delivery of a loan commitment on an offer with no other unsatisfied contingencies will create an enforceable contract and the buyer will be obligated to go through with the purchase even if the lender ultimately does not provide the loan.

2. Written direction to delivera. Once a buyer receives a loan commitment, the buyer will review the

commitment and determine whether the terms of the commitment are acceptable.

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Eb. If the terms are acceptable, the buyer will direct delivery of the loan

commitment to the seller. i. Direction must be in writing and could be achieved using the following

methods:1. A WB – 41 Notice Relating to Offer to Purchase2. A written statement authorizing delivery contained in the loan

commitment. 3. A cover sheet or other written direction to the seller.

ii. Written authorization of delivery must accompany the loan commitment provided to the seller.

3. Unavailability of financing a. A buyer may be unable to satisfy the financing contingency if a lender

rejects the application for lending or if the lending terms offered to the buyer are unacceptable to the buyer.

b. A buyer must demonstrate that the financing described in the financing contingency is unavailable. i. Rejection letters

1. To demonstrate unavailability of financing, a buyer would obtain rejection letters from lenders and forward them to the seller.

2. Multiple rejection letters may be needed depending on the financing terms in the contingency.

3. If a buyer named a loan from a specific source, a single rejection letter should be sufficient to demonstrate unavailability of financing.

ii. Notice of unavailability 1. A buyer may receive a loan commitment from a lender that differed

from the terms included in the buyer’s financing contingency. 2. A buyer who is approved for lending on terms other than those

included in the contingency may:a. Accept those terms and deliver the loan commitment to the

seller thereby satisfying the financing contingency. b. Reject those terms and deliver a notice of unavailability to the

seller. c. Demonstration of unavailability of financing does not mean an automatic

failure of a buyer’s offer.

d. A seller has 10 days after receiving a buyer’s notice of unavailability to decide whether to provide financing to the buyer on the terms stated in the contingency.

vi. Offers not contingent on financing

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1. This obligates a buyer to provide the seller with evidence that the funds required for closing will be available at closing.

2. Evidence may be from a financial institution or a third party in control of the funds.

3. Evidence must be provided to the seller within 7 days of acceptance. 4. If a buyer does not provide written verification of the funds, the seller has the

right to terminate the offer in writing. 5. By accepting an offer that is not contingent on financing, the seller is agreeing

to allow the buyer to have the property appraised and agreeing to permit access to the property for the buyer’s appraisal.

6. This does not mean that a buyer can use an appraisal value to back out of the offer unless the buyer also included an appraisal contingency in the offer.

b. The appraisal contingency

i. A buyer can use the appraisal contingency alone or in conjunction with the financing contingency.

ii. Including an appraisal contingency in conjunction with a financing contingency will protect a buyer from becoming contractually obligated to purchase a property that does not appraise at or above the purchase price.

iii. If the lender’s appraisal is below the purchase price, the buyer may deliver to the seller if the property is not listed, a copy of the appraisal report and a notice terminating the offer.

iv. A buyer using an appraisal contingency must make sure to include a long enough deadline for the appraisal to be completed.

v. The deadline for the appraisal contingency should be longer than the deadline for the financing contingency to protect the buyer in the case that the property does not appraise at a value equal to or greater than the purchase price.

c. An overview of the loan processi. Finding a lender

1. A lender may be the most important party that a buyer will deal with in the purchase of a home.

2. Lender options include banks, credit unions, savings and loan institutions, mortgage companies, or state and federal loan sources. a. A buyer’s satisfaction with a lender will depend on:

i. Interest rates;ii. Pre-paying interest by purchasing points;iii. Closing costs;iv. Location of the lender;

1. Will the buyer be able to meet with a representative of the lending institution?

2. Is it a national lending institution where the buyer will only have phone access to a customer service representative?

b. Buyers should be encouraged to talk with friends, family, and trusted financial institutions for lender recommendations.

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E3. Mortgage brokers

a. Mortgage brokers are firms or individuals who match borrowers with lenders.

b. Borrowers using a mortgage broker pay for the service provided by the mortgage broker.

c. Mortgage brokers accept loan applications from borrowers and submit them to lenders.

d. Mortgage brokers do not generate or service loans for borrowers but may receive compensation from lenders for matching borrowers to lending sources.

ii. Obtaining a mortgage1. Pre-qualification

a. Pre-qualification is the process of a buyer who is seeking to borrow funds providing a lender with information about the buyer’s worthiness for a loan.

b. A buyer seeking pre-qualification should be prepared to submit information about income, debts, and assets.

c. Pre-qualification can help buyers understand what size, features, and price they can reasonably afford in a home.

2. Pre-approvala. Pre-approval is where a lender commits to financing a purchase up to a

certain amount.b. Pre-approval is not guaranteed financing.c. A borrower must still apply for a mortgage.d. Pre-approval may give a buyer extra bargaining power because a lender

has assured financing. e. This may be especially true in the current market where financing has been

increasingly difficult to obtain. f. Pre-approval may shorten the actual mortgage process because the lender

will have already reviewed much of the borrower’s information required to process the loan application.

g. Lenders compare a buyer’s financial profile to the amount the buyer is asking to borrow.

h. Comparison will include looking at a buyer’s:i. Income;ii. Debts;iii. Assets; and iv. Credit history.

i. Lenders will measure a buyer’s debt to income ratio, which is a buyer’s monthly income compared to monthly debts.

j. Lenders will examine a buyer’s credit report. i. Borrowers can request free credit reports once annually from the three

main credit reporting agencies:1. Equifax;2. TransUnion; and3. Experian.

ii. To request a free credit report go to:1. https://www.annualcreditreport.com/cra/index.jsp 2. For more information on requesting credit reports, how to read

them, and consumers’ rights to their credit reports go to http://www.ftc.gov/freereports.

3. The buyer’s mortgagea. Licensees cannot provide legal or financial advice to buyers but a licensee

can help a buyer understand the financing process.

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b. Buyers shopping for mortgages will want to shop for the best lending arrangement for their needs.

c. This will include consideration of the following mortgage features:i. Prepayment penalties - Will the buyer have to pay a penalty for

prepayments of loan obligations?ii. Additional fees - Are there additional fees for borrowing the requested

amount?iii. Annual percentage rates

1. Is it a fixed or adjustable rate loan?2. If it is an adjustable rate loan, what are the rates and what triggers

adjustments in the rates?3. Can the adjustable rate become a fixed rate at any point in the life

of the loan?iv. Finance charges

1. This is what it will cost to borrow the money. 2. It is made up of the interest, the amount borrowed, and the length

of the loan. v. Points paid to a lender to obtain a lower interest rate on a loan. vi. Number and dollar amount of each payment

1. How many payments are required and what is the amount of each payment?

2. Are the payments the same throughout the course of the loan?3. Are there balloon payments during the life of the loan?

vii. Payment due date viii. Collateral

1. What collateral is securing the loan?2. Generally, if it is a real estate loan, the property purchased is the

collateral. ix. Total cost of the loan over the life of the loan

III. A Seller’s Financing a. The financing contingency

i. A seller considering offers contingent on a buyer’s financing should evaluate the terms of the loan included by the buyer as well as the length of time the buyer included to obtain a loan commitment to satisfy the financing contingency.

ii. A seller will also want to consider whether a buyer is using both a financing contingency and an appraisal contingency.

iii. A seller who would like to have a rapid closing on the transaction may not want to keep the property tied up in negotiations while waiting to see if a buyer’s appraisal will appraise the property at the purchase price or higher to satisfy a buyer’s appraisal contingency.

iv. A seller can terminate an offer if a buyer does not timely deliver a loan commitment.

v. A seller can decide to self-finance an offer with a financing contingency if a buyer demonstrates unavailability of financing. 1. Sellers have 10 days from the receipt of a buyer’s notice of unavailability of

financing to deliver written notice to a buyer of the seller’s intent to finance the transaction. a. This does not allow a seller to require a buyer to apply for lending with a

lender of the seller’s choice. b. It provides the seller with an option of financing the sale by providing a

mortgage loan to a buyer. c. This option is not available to a seller if the buyer named a specific lending

source in the contingency.

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Evi. Offers not contingent on financing

1. Sellers who accept offers that are not contingent on financing have the right to terminate the offer if a buyer fails to provide evidence of availability of funds to the seller within 7 days of acceptance.

2. If a seller accepts an offer that is not contingent on financing, the seller is agreeing to permit the buyer’s appraiser access the property for purposes of appraisal.

3. The offer is not automatically contingent on the buyer’s appraisal. 4. If a buyer making a “cash offer” wants the protection of an appraisal

contingency, that must be included in the offer. b. The appraisal contingency

i. The appraisal contingency can protect buyers from becoming obligated to continue with a purchase if the property does not appraise at the purchase price or higher.

ii. If a buyer provides a seller with a notice that the appraisal contingency is not satisfied, a seller could choose to let the offer fail or could choose to negotiate a lower sale price based on the appraisal returned by the buyer.

c. Seller provided financingi. More sellers may consider financing the sale of property due to the difficulty

buyers are experiencing in obtaining financing. ii. Seller provided financing makes the seller a secured creditor for unpaid

installments from the buyer and the sold property provides the security to back the financing.

iii. Land contracts1. A buyer pays a seller in installments and receives a deed when all payments

have been made rather than paying the entire purchase price at closing. 2. The seller retains legal title to the property as security and the buyer receives

equitable title when the contract is executed. 3. A seller may offer land contract financing to attract a broader range of potential

buyers. 4. Land contract financing allows a seller to report interest income and capital

gains on his or her income tax over the term of the contract. a. This may be a good investment for sellers depending on the interest rate

negotiated in the land contract and current market rates. b. Sellers who are seeking tax advice on the financial implications of a land

contract should be referred to an attorney or other tax professional. 5. Remedies for buyer default on a land contract

a. Voluntary terminationi. A buyer could quit claim the buyer’s interest to the seller. ii. The buyer will lose the property as well as the equity in the form of

payments already paid to the seller. b. Quiet title action

i. A seller could file an action in court to remove the land contract as a cloud on seller’s title to the property.

ii. A seller may choose this option if the buyer has abandoned the property.

iii. The seller is usually entitled to keep all payments made by the buyer. c. Sue the buyer for the unpaid purchase priced. Sue the buyer for foreclosure by sale

i. The court will establish a redemption period. ii. If a buyer does not pay the balance during the redemption period, the

sheriff sells the property at a public sale. e. Strict foreclosure

i. In strict foreclosure, the seller chooses to rescind the contract and waives the right to a deficiency judgment for the unpaid balance due on

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the contract. ii. The seller gets the property back and keeps all the payments the buyer

has already made. iii. There is no sheriff’s sale. iv. Wis. Stat. § 846.30 requires that the circuit court grant a redemption

period of at least 7 working days from the date of a judgment of strict foreclosure to all land contract purchasers.

v. A strict foreclosure will not be final until the court enters an order, separate from the judgment and after the redemption period has expired that confirms that the buyer has not redeemed.

vi. Within the redemption period fixed by the judge, the buyer must pay the entire balance to save the equity or lose all of the interest in the property.

iv. Seller provided mortgage 1. A seller can loan a buyer the money in the amount of the purchase price of

the property and receive a promissory note and mortgage from the buyer to evidence the debt and secure the payments on the note.

2. The buyer pays installments to the seller in the same way a buyer would pay a monthly mortgage payment to a financial institution in the case of a conventional loan.

3. A buyer receives the deed and title to the property at closing. 4. Remedies for buyer default on a seller provided mortgage

a. Mortgage foreclosurei. A seller who financed a sale with a seller provided mortgage must

follow the same process as any other lender who is seeking to sue for foreclosure.

ii. Wis. Stat. § 846 is the Wisconsin foreclosure statute. v. Lease with option to purchase

1. A lease with an option to purchase may be a possibility that a seller offers to a buyer who could potentially qualify for financing in the future after some financial restructuring by the buyer.

2. A lease with an option to purchase creates a “rent-to-own” arrangement. 3. During the initial lease phase, the seller and the buyer enter into a lease

agreement for the property. 4. This gives the potential buyer time to rebuild credit history, save for a down

payment, or otherwise stabilize the buyer’s financial picture. 5. If a buyer is able to improve creditworthiness, the buyer would then apply for

financing and exercise the option. 6. The option to purchase creates a continuing promise to sell. 7. If a buyer exercises an option to purchase and purchases the property

according to the terms of the option, this creates an enforceable purchase contract.

vi. Seller financing and the Secure and Fair Enforcement Mortgage Licensing Act of 2008 (SAFE Act) 1. The SAFE Act required states to enact legislation in accordance with the SAFE

Act’s nationwide standards for mortgage loan originators. a. SAFE Act revisions to Wis. Stat. § 224

i. Effective January 1, 2010ii. Wis. Stat. § 224.71(14)- Residential mortgage loan is now defined

as “any loan primarily for personal, family, or household use that is secured by a lien, mortgage, or equivalent security interest, on a dwelling or residential real property located in this state.”

iii. Wis. Stat. § 224.71(1f)- Dwelling is defined as “a residential structure or mobile home which contains one to four family housing units, or

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Eindividual units of condominiums or cooperatives.”

iv. Wis. Stat. § 224.71(15)- Residential real property is defined as “real property on which a dwelling is constructed or intended to be constructed.”

v. Wis. Stat. § 224.71(6)(a)- Mortgage loan originator is defined as “an individual who, for compensation or gain, takes a residential mortgage loan application or offers or negotiates the terms of a residential mortgage loan.”

b. These revisions to the definitions in Wis. Stat. § 224 caused concern that in transactions where the seller was selling a personal residence to a buyer using some form of seller provided financing, both the seller and the licensee would need to be licensed as mortgage loan originators.

c. After consultation with the Wisconsin Department of Financial Institutions (DFI), the WRA has confirmed that if a seller is selling a personal residence using seller provided financing, the seller and the licensee negotiating the transaction do not qualify as mortgage loan originators under the definition and therefore, do not need to obtain licensure as mortgage loan originators.

d. DFI has indicated that they will analyze a transaction using the following basic tests to determine if a party needs to obtain licensure as a mortgage loan originator:i. If the property is the seller’s residence, then it is an exempt transaction

and neither the seller nor the broker needs a mortgage loan originator or other mortgage license.

ii. If the property is not the seller’s residence and the buyer is not purchasing the property for the buyer’s residence, then neither the seller nor the broker needs a mortgage loan originator or other mortgage license.

iii. If the property is not the seller’s residence and the buyer is purchasing the property to be used as the buyer’s residence, then the seller and the broker need to have a mortgage loan originator or other mortgage license.

A broker has a buyer who would like to write an offer with seller financing offering a three-year land contract for the purchase of the seller’s vacation home. How should a broker draft the offer?

A seller is the personal representative of her deceased parents' estate. The estate contains the home. A buyer wants to purchase the property on a land contract. Can the personal representative sell the property to the buyer on a land contract and can a licensee draft the offer?

IV. Licensee Financing Concernsa. The financing contingency

i. Delivery of a loan commitment1. Brokers would be wise to create office policies ensuring that all deliveries of

loan commitments to sellers are properly authorized by the buyers in writing. 2. Loan commitments delivered without proper written authorization put the

buyer’s transaction and the broker at risk. 3. Brokers working with local lenders may ask the lender to include an

authorization to deliver the statement in the lender’s loan commitments. 4. A buyer’s signature agreeing to the terms of the loan commitment with the

lender does not grant authority to the lender or the broker to deliver the commitment to the seller.

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5. A broker delivering a loan commitment to a seller must make sure that the written authorization for delivery accompanies the loan commitment.

6. Arguably, delivery of a loan commitment without written authorization does not satisfy the financing contingency in an offer.

7. By implementing policies to ensure that all delivered loan commitments are accompanied by a buyer’s written direction for delivery, a broker may prevent legal ambiguity regarding satisfaction of the financing contingency.

ii. The appraisal contingency1. Brokers working on a transaction involving an appraisal contingency are

reminded that a buyer does not need to automatically terminate an offer because the appraisal contingency is not satisfied.

2. It may be possible to have the seller and the buyer negotiate a lower purchase price and continue with the transaction.

3. This negotiation can be accomplished by the parties signing a WB – 40 Amendment to Offer to Purchase.

b. The licensee’s role in seller provided financingi. Land contracts or mortgage agreements

1. Licensees holding sales licenses cannot draft Wisconsin State Bar forms such as land contracts or mortgage agreements.

2. Brokers can use Wisconsin State Bar forms including the SB – 11 Land Contract.

3. A Wisconsin State Bar Form SB – 11 Land Contract is included in the appendix.

4. Brokers are strongly encouraged to have the parties consult legal counsel to draft the land contract and consult about their rights prior to entering into the land contract.

5. When using the SB – 11 Land Contract, parties should address:a. Purchase price, down payment, and land contract balance;b. Interest rate, contract term, and amortization schedule;c. Schedule and amount of installment payments;d. Maturity date;e. If, and under what conditions, prepayment will be allowed;f. Payment of property taxes;g. Default grace period provisions;h. Buyer’s creditworthiness and financial status;i. Status and disposition of underlying mortgage;j. Purchase price adjustments;k. Interest rate modifications;l. Seller’s rights upon buyer default;m. Buyer’s rights upon seller default; andn. Document preparation responsibilities and cost.

6. Commissions in land contract transactionsa. The closing of a land contract conveys equitable title to the buyer and

creates an enforceable contract which triggers a seller’s commission obligations.

b. If a buyer’s down payment on a land contract is not enough to pay the entire listing broker’s commission, the seller and the broker may negotiate other arrangements. i. A seller may offer to pay part of the commission at closing and the

remaining portion in installments as the buyer makes payments to the seller.

ii. A broker may want to include these provisions in the listing contract or amend the listing contract to reflect arrangements for an extended payment of a listing broker’s commission.

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Eii. Leases with options to purchase

1. Licensees can use a lease form or rental agreement drafted by an owner or an attorney and the WB – 24 Option to Purchase when a seller and buyer want to create this arrangement.

2. The WB – 24 Option to Purchase and the WRA’s WRA – NRL Residential Lease are included in the appendix.

3. A lease and an option to purchase are two separate contracts but they can be used in conjunction to create a “rent-to-own” arrangement. a. For example, a lease may indicate that a certain amount of the rent will be

applied to the purchase price if the buyer exercises the option to purchase. b. The lease may also contain provisions for termination of the lease when a

buyer exercises the option or termination of the lease if the option expires. 4. Commissions in leases with options to purchase

a. Execution of an option to purchase does not earn a commission for the listing broker.

b. A commission is earned if the buyer exercises the option.

V. Real Estate Settlement Procedures Act (RESPA) a. RESPA is a Department of Housing and Urban Development statute designed

to protect consumers during the closing and settlement portions of a real estate transaction. i. RESPA requires disclosures of settlement costs. ii. RESPA prohibits kickbacks that would increase the cost of settlement services. iii. Transactions covered by RESPA

1. RESPA applies to real estate transactions involving a federally related mortgage loan.

2. A federally related mortgage loan is:a. One secured by a mortgage;b. On residential real property that is the present or future sight of a 1-4 family

structure;c. Made by a federally related lender.

3. Generally, RESPA applies to:a. Home purchase loans;b. Refinancing;c. Property improvement loans;d. Equity lines of credit;e. Reverse mortgages;f. Loans for some time-shares, mobile homes, and condominiums; andg. FHA, VA, and other government sponsored mortgage loans.

iv. RESPA does not apply to cash sales, land contracts, or seller provided mortgages. v. RESPA violations

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1. Suspected violations of RESPA can be reported to 1-202-708-0502 or by submitting a complaint in writing to the Director, Office of RESPA and Interstate Land Sales, US Department of Housing and Urban Development.

2. For more information, go to www.hud.gov .

VI. Other Financing Industry Developments a. The Good Faith Estimate (GFE)

i. The GFE is an estimate of settlement charges that a borrower can expect to pay to obtain a requested loan. 1. The GFE will list the charges the buyer is likely to pay at settlement whether or

not the borrower is actually going to pay those charges. 2. A GFE “expires” within 10 days of being provided to a borrower if the borrower

does not express intent to continue with the loan application. ii. Delivery of the GFE

1. Lenders must deliver a GFE to borrowers no later than three business days from the receipt by the loan originator of the loan application.

2. A new GFE must be delivered if circumstances change. 3. If a borrower’s credit score is reduced or if the property appraises below the

anticipated value, the lender must issue a new GFE. 4. The three day rule cannot be waived, which may result in closing delays when

a lender must issue a new GFE to a borrower. b. The HUD – 1

i. The HUD – 1 shows the charges imposed on borrowers and sellers in connection with the settlement.1. Includes a comparison chart to help borrowers compare the estimated charges

provided on the GFE and the actual charges on the HUD – 1. 2. Borrowers can request to see the HUD – 1 one day before the actual

settlement. ii. Variations between the GFE and the HUD – 1

1. Lenders are penalized if actual costs exceed the amount disclosed on the GFE.

2. Tolerance limits are expressed in three categories. a. Zero tolerance - Applies to expenses controlled by the lender such as

origination fees, charges or points for a specific interest rate, and transfer taxes.

b. 10% tolerance– Applies to expenses such as settlement agent fees, lender ordered appraisal fees, and lender’s title insurance if lender selected the provider.

c. No limit - Applies to broker commissions. c. Major regulatory changes required under the Dodd-Frank Act

i. The Dodd-Frank Act created a schedule of 250 regulatory rules and 70 studies to be completed by 12/31/2011.

ii. Changes include:1. Expansion of the Federal Reserve’s supervisory role to include non-bank

financial companies;2. The expansion is intended to limit risk due to instability of financial entities not

previously supervised by the Federal Reserve; 3. Creation of the Office of Financial Research within the United States Treasury

Department; 4. The purpose of the Office is to gather information and make rules related to

financial market participants; 5. Creates Consumer Financial Protection Bureau;6. The National Association of Realtors® secured an exemption from the

Consumer Financial Protection Bureau’s jurisdiction for real estate

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Eprofessionals performing real estate activities except to the extent that they are already covered by existing laws such as RESPA;

7. Establishes a 5% “risk retention” requirement for securitized assets, such as mortgages, sold to the secondary market; and

8. Non-predatory qualified mortgages may be exempt from the risk retention.

VII. Loan Sourcesa. Conventional loans

i. Banks, credit unions, and savings and loans are the historical sources for conventional loans.

ii. Characteristics of a conventional loan1. 20% down and private mortgage insurance (PMI)

a. Private mortgage insurance can help borrowers with less than 20% down qualify for a conventional loan.

b. The borrower pays an initial premium and/or monthly premiums and lenders receive insurance for a part of the borrowed amount.

c. Premiums are based on risk with smaller down payments requiring higher premiums.

2. Fixed interest rate3. Amortized over 30-years

b. Non-conforming loansi. Non-conforming loan is a broad term used to characterize any loan that does not

fit the conforming loan standards established by the Office of Federal Housing Enterprise Oversight (OFHEO).

ii. The OFHEO sets limits for loans that Freddie Mac and Fannie Mae can purchase and repackage on the secondary market.

iii. Conforming loan criteria include maximum loan amounts, debt-to-income ratio limits, and documentation requirements.

c. Governmenti. Wisconsin Housing and Economic Development Authority (WHEDA) Affordable

Housing Loans 1. WHEDA administers the federal low-income housing tax credit for Wisconsin.

a. The program encourages development of rental housing for low to moderate income tenants.

b. The credits subsidize the rent paid by the tenant through income tax credits.

c. WHEDA’s Affordable Housing Loan program is a residential program available to investors, not a loan for a business.

d. WHEDA’s program operates as an income tax credit program rather than a loan guarantee.

2. The credit is a dollar for dollar reduction in federal income taxes for the owner over a period of ten years.

3. To qualify for the loan:a. A percentage of tenants must have income at or below 60% of a county’s

median income. b. The owner of the property must agree to maintain the project for 30 years

maintaining a minimum percentage of rent-restricted units for qualified tenants.

4. Non-compliance results in a credit recapture.5. Benefits to participating in a WHEDA Affordable Housing Loan:

a. Greater access to affordable housing for low-income renters;b. Income tax credits for ten years for the owner;c. Reduction in lenders loan to value by tax credit equity;d. Job creation by the production of housing; and

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e. Increase in affordable housing for economically stressed urban markets and rural areas.

6. Other WHEDA programs:a. WHEDA Home Improvement Advantage

i. Provides up to $10,000 for WHEDA homeowners to complete up to $10,000 in repairs.

ii. For more information, go to http://www.wheda.com/root/HomeImprovementAdvantage/.

b. WHEDA Multifamily Financingi. Various programs provide below market financing for targeted housing

such as housing for families, elderly or people with disabilities. ii. For more information, go to http://www.wheda.com/root/

MultifamilyDevelopers.aspx/. c. WHEDA Small Business Guarantee

i. Financing to acquire or expand a small business.ii. For more information, go to http://www.wheda.com/root/

BusinessPartners/SmallBusinessLenders/Dynamic.aspx?id=688. d. WHEDA Contractors Loan Guarantee

i. To assist contractors in completing contracts.ii. For more information, go to http://www.wheda.com/root/

BusinessPartners/SmallBusinessLenders/Dynamic.aspx?id=889. e. WHEDA Neighborhood Business Revitalization Guarantee

i. To expand or develop a business in targeted urban areas.ii. For more information, go to http://www.wheda.com/root/

BusinessPartners/SmallBusinessLenders/Dynamic.aspx?id=815. f. WHEDA Agribusiness Guarantee

i. Financing to develop or expand production of products using raw agricultural commodities in Wisconsin.

ii. For more information, go to: http://www.wheda.com/root/BusinessPartners/SmallBusinessLenders/Dynamic.aspx?id=815.

g. WHEDA Linked Deposit Loan Subsidyi. An interest rate subsidy on lender financing to women or minorities who

start-up or expand a business.ii. For more information, go to http://www.wheda.com/root/

BusinessPartners/SmallBusinessLenders/Dynamic.aspx?id=791. h. WHEDA New Markets Tax Credits

i. A portion of the costs of a project are covered with equity gained from selling the New Markets Tax Credits.

ii. The credits are directed to investors making equity investments in rural and urban low-income communities.

iii. The effect is an equity infusion (about 10% of the project) which reduces the traditional financing required.

iv. Participating banks provide financing at 1.5% - 2% below prevailing market rates.

v. For more information, go to http://www.wheda.com/root/WhedaProducts/NewMarketsTaxCredits/Default.aspx?id=813.

i. WHEDA Neighborhood Advantagei. Available to owner occupants of foreclosed homes. ii. It provides a grant for a portion of the down payment and closing costs

for the purchase of a foreclosed home, and will allow the financing of a portion of the rehabilitation costs as part of the loan.

iii. Participation is not limited to first time buyers.iv. For more information, go to http://www.wheda.com/root/HomeBuyers/

WHEDAMortgages/Dynamic.aspx?id=1806.

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Ej. For more information, go to www.wheda.com. k. WHEDA provides e-mail updates to the public about current programs and

new developments. To receive the updates, go to www.wheda.com and select “e-mail updates.”

ii. Federal Housing Authority Loan Programs1. FHA insured conventional loan

a. The FHA program has undergone a number of modifications. b. The most significant recent changes include a reduction in the amount of

permitted seller assistance from 6% to 3%.c. In addition, the insurance premium has been adjusted several times.

2. FHA/VA Tandem Loana. Only available for veterans who:

i. Already used their VA eligibility, or ii. Who wish to preserve their VA certificate of eligibility for later use.

b. Also known as FHA/VA 203(v) loan3. FHA Adjustable Rate Mortgage

i. Available for refinancingii. Assumable iii. Caps of 1 point annual, five lifetime.

4. FHA Graduated Payment Mortgagea. Lower initial monthly payments during the early years of the loan.b. Payments rise over time.c. Then remain fixed for the life of the loan.

5. FHA Manufactured Housing Loansa. For the home and land. b. The loan can be used for one if the other is already owned.

6. FHA Rehabilitation Home Mortgage Insurancea. For renovating existing housing. b. Conversion of non-residential properties to housing.

7. FHA financing for disaster victims provides 100% financing for homes destroyed in a federal disaster area.

8. For more information, go to http://www.hud.gov/buying/loans.cfm. iii. HUD - Good Neighbor Next Door Program

1. Designed to promote revitalization of distressed neighborhoods by offering home buyer incentives to eligible buyers interested in purchasing property in areas in need of revitalization.

2. Eligible buyers:a. Law enforcement officers; b. Teachers through 12th grade; andc. Firefighter/emergency medical technicians.

3. Eligible properties:a. Properties owned by HUD through foreclosure in revitalization areas; andb. Properties are sold “as is.”

4. Benefitsa. Purchasers can use FHA, VA, conventional loans, or cash to purchase the

property.b. Earnest money must accompany the offer.

i. Earnest money must only equal 1% of the list price. ii. Not less than $500 and not more than $2000.

c. Purchase price at 50% of appraised value. d. $100 down payment.e. Closing costs may be financed. f. The 50% discount is in the form of a “silent second” which is waived after a

36 month occupancy period.

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5. For additional information, go to http://www.hud.gov/offices/hsg/sfh/reo/goodn/gnndabot.cfm.

d. Veterans Administration (VA)i. Eligibility

1. Under the federal VA program, qualified veterans may borrow up to $417,000 with no money down.

2. Veterans are eligible based on service during various wartime and peacetime periods in U.S. military or other qualified entities.

3. The property must be appraised at the purchase price or higher. 4. Veterans obtain a Certificate of Eligibility from the VA. 5. The federal government guarantees the loan up to a maximum of $104,250 for

2011. e. Rural Development

i. The US Rural Development loan program offers a number of lending programs to assist rural areas in developing utilities, jobs, agricultural programs and housing.

ii. Financing for housing is based on geographical and income limitations. iii. Attractive features include an amortization period as long as 38 years and an

interest rate as low as 1%. iv. Buyers with credit issues may qualify if certain criteria support a determination of a

likelihood of re-payment.v. For more information, go to http://www.rurdev.usda.gov/RD_Loans.html.

f. Making Homes Affordable Programsi. The Making Home Affordable Program is a federal effort to stabilize the housing

market and provide relief to struggling homeowners.ii. It includes programs to provide distressed homeowners with assistance in keeping

their homes or provide distressed homeowners with alternatives to foreclosure. 1. Home Affordable Refinance Program (HARP)

a. Provides opportunities to lower monthly loan payments through refinancing of the loan.

b. HARP is limited to loans on primary residences containing for 1-4 dwelling units.

c. Eligibility is limited to loans owned or guaranteed by Fannie Mae or Freddie Mac.

d. Loans payments must be current. i. Current means not more than 30 days late on a mortgage payment in

the last 12 months. ii. If the mortgage has been held for less than 12 months, current means

the borrower has never missed a payment. e. The remaining balance of the mortgage must be less than 125% of the

home’s value. 2. Home Affordable Modification Program (HAMP)

a. Provides financial relief to eligible homeowners by modifying current loan obligations.

b. Eligibility is limited to:i. The homeowner’s principal place of residence; ii. A first lien mortgage originated on or before January 1, 2009; iii. The borrower has defaulted on the mortgage or default is reasonably

foreseeable; iv. Demonstrable hardship; v. An unpaid principal balance of less than $729,750; andvi. Monthly mortgage payments must exceed 31% of the borrower’s gross

income.

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Ec. Mortgage payments consist of:

i. Principal;ii. Interest;iii. Taxes;iv. Insurance; andv. Homeowner’s association dues.

d. Borrowers must enter into a trial period plan before being eligible for a permanent modification.

e. Failure to qualify for HAMP or failure to make payments under the trial plan might allow eligibility for the HAFA program.

3. Home Affordable Foreclosure Alternatives Program (HAFA)a. Provides distressed homeowners foreclosure alternatives. b. HAFA serves as a complimentary program to HAMP by providing an

alternative for borrowers who are HAMP eligible but unable to keep the home. i. Program participants determine eligibility using information previously

collected in evaluating the applicants eligibility for HAMP. ii. Lenders may provide pre-approved short sale terms iii. Borrowers must be released from future liability for the first mortgage

debt. iv. Provides applicants with the following financial incentives:

1. $3000 for relocation assistance;2. $1500 for servicers to cover costs; and3. Up to $2000 for investors who allow a total of up to $6000 in short

sale proceeds to be distributed to subordinate lien holders on a one-for-three matching basis.

v. HAFA loan servicers cannot require commission reductions if the commission is not greater than 6% of the sale price.

c. HAFA proceduresi. Servicers determine eligibility for relief. ii. Short sale agreements will contain lender acceptance limits for list

price, net sale terms, and maximum closing costs. 4. Second Lien Modification Program (2MP)

a. Provide financial relief by lowering payments on second mortgages. b. A first mortgage must have been modified under the HAMP program. c. The loan obligation must have originated before January 1, 2009. d. The homeowner must owe at least $5000 with monthly payments greater

than $100. e. If the property is eligible for participation, a mortgage servicer could offer:

i. Reductions of interest rates to 1% (2% for interest only loans);ii. Extension of the loan term to 40 years; or iii. Forgiveness of a portion of the outstanding debt.

5. For more information on all of the programs available through the Making Home Affordable Program, go to http://www.makinghomeaffordable.gov/.

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State Bar Form 11 - Page 1

Document Number

State Bar of Wisconsin Form 11 - 2003LAND CONTRACT

CONTRACT, by and between

("Purchaser," whether one or more).

Parcel Identification Number (PIN)

Purchaser agrees to purchase the Property and to pay to Vendor at

County, State of Wisconsin:

This homestead property.(is) (is not)

Recording Area

Name and Return Address

Document Name

performance of this Contract by Purchaser, the following real estate, togetherwith the rents, profits, fixtures and other appurtenant interests "Property", in

the sum of $

provided the entire outstanding balance shall be paid in full on or before

CHOOSE ONE OF THE FOLLOWING OPTIONS; IF NO OPTION IS CHOSEN, OPTION A SHALL APPLY:A. Any amount may be prepaid without premium or fee upon principal at any time.

(TO BE USED FOR NON-CONSUMER ACT TRANSACTIONS)

("Vendor," whether one or more),and

Vendor sells and agrees to convey to Purchaser, upon the prompt and full

This a purchase money mortgage.(is) (is not)

in the following manner:

(a) $ at the execution of this Contract; and

(b) the balance of $ , together with interest from the date hereof on the balanceoutstanding from time to time at the rate of % per annum until paid in full as follows:

("MaturityDate"). Payments shall be applied first to interest on the unpaid balance at the rate specified and then to principal.

B. Any amount may be prepaid without premium or fee upon principal at any time after .

C. There may be no prepayment of principal without written permission of Vendor.

Phone: Fax:Produced with ZipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com

Wisconsin REALTORS Association 4801 Forest Run Rd Ste 201 Madison, WI 53704 (608)241-2047 UntitledJennifer Lindsley


Produced with ZipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com

CHOOSE ONE OF THE FOLLOWING OPTIONS; IF NEITHER IS CHOSEN, OPTION A SHALL APPLY:A. Any prepayment shall be applied to principal in the inverse order of maturity and shall not delay the due dates or change

the amount of the remaining payments until the unpaid balance of principal and interest is paid in full.

B. In the event of any prepayment, this Contract shall not be treated as in default with respect to payment so long as theunpaid balance of principal and interest (and in such case accruing interest from month to month shall be treated as unpaidprincipal) is less than the amount that said indebtedness would have been had the monthly payments been made asspecified above; provided that monthly payments shall continue in the event of credit of any proceeds of insurance orcondemnation, the condemned premises being thereafter excluded from this Contract.

Purchaser shall pay prior to delinquency all taxes and assessments levied on the Property at the time of the execution of thisContract and thereafter, and deliver to Vendor on demand receipts showing such payment.

Purchaser shall keep the improvements on the Property insured against loss or damage occasioned by fire, extended coverage perilsand such other hazards as Vendor may require, without co-insurance, through insurers approved by Vendor, in the amount of thefull replacement value of the improvements on the Property. Purchaser shall pay the insurance premiums when due. The policiesshall contain the standard clause in favor of Vendor's interest, and evidence of such policies covering the Property shall be providedto Vendor. Purchaser shall promptly give notice of loss to insurance companies and Vendor. Unless Purchaser and Vendorotherwise agree in writing, insurance proceeds shall be applied to restoration or repair of the Property damaged, provided Vendordeems the restoration or repair to be economically feasible.

Purchaser is required to pay Vendor amounts sufficient to pay reasonably anticipated taxes, assessments, andinsurance premiums as part of Purchaser's regular payments [CHECK BOX AT LEFT IF APPLICABLE].

Purchaser shall not commit waste nor allow waste to be committed on the Property, keep the Property in good tenantable conditionand repair, and free from liens superior to the lien of this Contract, and comply with all laws, ordinances and regulations affectingthe Property. If a repair required of Purchaser relates to an insured casualty, Purchaser shall not be responsible for performing suchrepair if Vendor does not make available to Purchaser the insurance proceeds therefor.

Vendor agrees that if the purchase price with interest is fully paid and all conditions fully performed as specified herein, Vendorwill execute and deliver to Purchaser a Warranty Deed in fee simple of the Property, free and clear of all liens and encumbrances,except those created by the act or default of Purchaser, and:

CHOOSE ONE OF THE FOLLOWING OPTIONS; IF NO OPTION IS CHOSEN, OPTION A SHALL APPLY:A. Purchaser states that Purchaser is satisfied with the title as shown by the title evidence submitted to Purchaser for

examination, at the time of execution of this Contract.

B. Purchaser states that the following exceptions set forth in the title evidence submitted to Purchaser for examination, at thetime of execution of this Contract, are unsatisfactory to Purchaser:

C. No title evidence was provided prior to execution of this Contract.

Untitled



CHOOSE ONE OF THE FOLLOWING OPTIONS; IF NEITHER IS CHOSEN, OPTION A SHALL APPLY:A. Purchaser agrees to pay the cost of future title evidence.

B. Vendor agrees to pay the cost of future title evidence.

Purchaser agrees that in the event of a default in the payment of principal or interest which continues for a period of

outstanding balance under this contract shall become immediately due and payable at Vendor's option and without notice (whichPurchaser hereby waives), and Vendor may singly, alternatively or in combination: (i) terminate this Contract and either recover theProperty through strict foreclosure or have the Property sold by foreclosure sale; in either event, with a period of redemption, in thecourt's discretion, to be conditioned on full payment of the entire outstanding balance, with interest thereon from the date of defaultand other amounts due hereunder (failing which all amounts previously paid by Purchaser shall be forfeited as liquidated damagesfor failure to fulfill this Contract and as rental for the Property); (ii) sue for specific performance of this Contract; (iii) sue for theunpaid purchase price or any portion thereof; (iv) declare this Contract at an end and remove this Contract as a cloud on title in aquiet-title action if the equitable interest of Purchaser is insignificant; (v) have Purchaser ejected from possession of the Propertyand have a receiver appointed to collect any rents, issues or profits; or (vi) pursue any other remedy available in law or equity. Anelection of any of the foregoing remedies shall only be binding on Vendor if and when pursued in litigation. All costs and expensesincluding reasonable attorney fees of Vendor incurred to pursue any remedy hereunder to the extent not prohibited by law andexpenses of title evidence shall be paid by Purchaser and included in any judgment. The parties agree that Vendor shall have theoptions set forth in this paragraph available to exercise in Vendor's sole discretion.

Purchaser shall be entitled to take possession of the Property on .

Time is of the essence as to all provisions hereunder.

days following the due date or a default in performance of any other obligation of Purchaser which continues for a period ofdays following written notice thereof by Vendor (delivered personally or mailed by certified mail), the entire

Following any default in payment, interest shall accrue at the rate of % per annum on the entire amount in default(which shall include, without limitation, delinquent interest and, upon acceleration or maturity, the entire principal balance).

Vendor may waive any default without waiving any other subsequent or prior default of Purchaser.

Purchaser may not transfer, sell or convey any legal or equitable interest in the Property, including but not limited to a lease for aterm greater than one year, without the prior written consent of Vendor unless the outstanding balance payable under this Contractis paid in full. In the event of any such transfer, sale or conveyance without Vendor's written consent, the entire outstanding balancepayable under this Contract shall become immediately due and payable in full at Vendor's option without notice.

Vendor may mortgage the Property, including the continuation of any mortgage in force on the date of this Contract, providedVendor shall make timely payment of all amounts due under any mortgage, and the total due under such mortgages shall not at anytime exceed the then remaining principal balance under this Contract. If Vendor defaults under such mortgages and Purchaser is notin default hereunder, Purchaser may make payments directly to Vendor's mortgagee and such payments will be credited aspayments hereunder.

All terms of this Contract shall be binding upon and inure to the benefit of the heirs, legal representatives, successors and assigns ofVendor and Purchaser.

Untitled



VENDOR: PURCHASER:

(SEAL) (SEAL)* *

(SEAL) (SEAL)* *

AUTHENTICATION ACKNOWLEDGMENT

)STATE OF WISCONSINSignature(s)) ss.)COUNTY

Personally came before me onauthenticated on

the above-named*

to me known to be the person(s) who executed theforegoing instrument and acknowledged the same.

TITLE: MEMBER STATE BAR OF WISCONSIN(If not,authorized by Wis. Stat. § 706.06)

*THIS INSTRUMENT DRAFTED BY:

Notary Public, State of WisconsinMy Commission (is permanent) (expires: )

(Signatures may be authenticated or acknowledged. Both are not necessary.)NOTE: THIS IS A STANDARD FORM. ANY MODIFICATIONS TO THIS FORM SHOULD BE CLEARLY IDENTIFIED.

LAND CONTRACT STATE BAR OF WISCONSIN FORM No. 11-2003

*Type name below signatures.

Dated

. ,

Untitled

Approved by the Wisconsin Department of Regulation and Licensing6-1-00 (Optional Use Date)9-1-00 (Mandatory Use Date) Page 1 of 4WB-24 OPTION TO PURCHASE

123456789

10111213141516171819202122232425262728293031323334353637383940414243444546474849505152535455565758

BROKER DRAFTING THIS OPTION ON [DATE] IS AGENT OF (SELLER)(BUYER)(DUAL AGENT) STRIKE TWOThe Seller, , hereby grants to Buyer,

, an option to purchase (Option) the Propertyknown as [Street Address] in the

of , County of , Wisconsin,(if this Option is to be recorded, insert legal description at lines 218-224 or attach as an addendum per line 225) on the following terms:DEADLINE FOR GRANT OF OPTION This Option is void unless a copy of the Option which has been signed by or on behalf ofall Owners is delivered to Buyer on or before (Time is of the Essence).OPTION TERMS An option fee of $ will be paid by Buyer within days of the granting of this Option, andshall not be refundable if the Option is not exercised. If the Option is exercised, $ of the option fee shall be a creditagainst the purchase price at closing. This Option may only be exercised by delivering written notice to Seller no later thanmidnight . Buyer may sign and deliver the notice at lines 247-248, or may deliver any other written noticewhich specifically indicates an intent to exercise this Option. This Option shall be extended until , uponpayment of $ in cash or equivalent to Seller on or before , as an option extensionfee which shall not be refundable if this Option is not exercised. If this Option is exercised, $ of the option extensionfee shall be a credit against the purchase price at closing. The option fee and option extension fee shall be (paid directly to Seller)(held in listing broker's trust account until

.STRIKE ONE)This Option, or a separate instrument evidencing this Option, (may) (may not) STRIKE ONE be recorded. CAUTION: FAILURE TORECORD MAY GIVE PERSONS WITH SUBSEQUENT INTERESTS IN THE PROPERTY PRIORITY OVER THIS OPTION.TERMS OF PURCHASE If this Option is exercised per the terms of this Option, the following shall be the terms of purchase:

PURCHASE PRICE:) will be paid in cash or equivalent at closing unless otherwise provided below.Dollars ($

ADDITIONAL ITEMS INCLUDED IN PURCHASE PRICE: Seller shall include in the purchase price and transfer, free and clear ofencumbrances, all fixtures, as defined at lines 172-175 and as may be on the Property on the date of this Option, unless excluded at lines28-29, and the following additional items:

ITEMS NOT INCLUDED IN THE PURCHASE PRICE:

CONVEYANCE OF TITLE: Upon payment of the purchase price, Seller shall convey the Property by warranty deed (orother conveyance as provided herein) free and clear of all liens and encumbrances, except: municipal and zoning ordinances andagreements entered under them, recorded easements for the distribution of utility and municipal services, recorded building and userestrictions and covenants, general taxes levied in the year of closing and

(provided noneof the foregoing prohibit present use of the Property), which constitutes merchantable title for purposes of this transaction. Sellerfurther agrees to complete and execute the documents necessary to record the conveyance.PLACE OF CLOSING This transaction is to be closed at the place designated by Buyer's mortgagee or

days after the exercise of the Option, unless another date or place is agreed to in writing.withinOCCUPANCY Occupancy of the entire Property shall be given to Buyer at time of closing unless otherwise provided in this Option(lines 218-224 or in an addendum per line 225). Occupancy shall be given subject to tenant's rights, if any. Caution: Consideran agreement which addresses responsibility for clearing the Property of personal property and debris, if applicable.LEASED PROPERTY If Property is currently leased and lease(s) extend beyond closing, Seller shall assign Seller's rights under the

STRIKE ONElease(s) and transfer all security deposits and prepaid rents thereunder to Buyer at closing. The terms of the (written) (oral)lease(s), if any, are .CLOSING PRORATIONS The following items shall be prorated at closing: real estate taxes, rents, private and municipal charges,property owner's association assessments, fuel and

. Any income, taxes or expenses shall accrue to Seller, and be prorated, through the day prior to closing. Netgeneral real estate taxes shall be prorated based on (the net general real estate taxes for the current year, if known, otherwise on the netgeneral real estate taxes for the preceding year) (

STRIKE AND COMPLETE AS APPLICABLE) .CAUTION: If proration on the basis of net general real estate taxes is not acceptable (for example, completed/pendingreassessment, changing mill rate, lottery credits), insert estimated annual tax or other formula for proration.ZONING Seller represents that the property is zoned .REPRESENTATIONS REGARDING PROPERTY AND TRANSACTION Seller represents to Buyer that as of the date Seller grants thisOption Seller has no notice or knowledge of conditions affecting the Property or transaction (as defined at lines 63 - 88) other than thoseidentified in Seller's property condition report, dated , which was received by Buyer prior to Buyer signingthis Option COMPLETE DATE OR STRIKE AS APPLICABLE and

.


Wisconsin REALTORS Association 4801 Forest Run Rd Ste 201 Madison, WI 53704(608)241-2047 Jennifer Lindsley Untitled



CHOOSE ONE OF THE FOLLOWING OPTIONS; IF NEITHER IS CHOSEN, OPTION A SHALL APPLY:A. Any prepayment shall be applied to principal in the inverse order of maturity and shall not delay the due dates or change

the amount of the remaining payments until the unpaid balance of principal and interest is paid in full.

B. In the event of any prepayment, this Contract shall not be treated as in default with respect to payment so long as theunpaid balance of principal and interest (and in such case accruing interest from month to month shall be treated as unpaidprincipal) is less than the amount that said indebtedness would have been had the monthly payments been made asspecified above; provided that monthly payments shall continue in the event of credit of any proceeds of insurance orcondemnation, the condemned premises being thereafter excluded from this Contract.

Purchaser shall pay prior to delinquency all taxes and assessments levied on the Property at the time of the execution of thisContract and thereafter, and deliver to Vendor on demand receipts showing such payment.

Purchaser shall keep the improvements on the Property insured against loss or damage occasioned by fire, extended coverage perilsand such other hazards as Vendor may require, without co-insurance, through insurers approved by Vendor, in the amount of thefull replacement value of the improvements on the Property. Purchaser shall pay the insurance premiums when due. The policiesshall contain the standard clause in favor of Vendor's interest, and evidence of such policies covering the Property shall be providedto Vendor. Purchaser shall promptly give notice of loss to insurance companies and Vendor. Unless Purchaser and Vendorotherwise agree in writing, insurance proceeds shall be applied to restoration or repair of the Property damaged, provided Vendordeems the restoration or repair to be economically feasible.

Purchaser is required to pay Vendor amounts sufficient to pay reasonably anticipated taxes, assessments, andinsurance premiums as part of Purchaser's regular payments [CHECK BOX AT LEFT IF APPLICABLE].

Purchaser shall not commit waste nor allow waste to be committed on the Property, keep the Property in good tenantable conditionand repair, and free from liens superior to the lien of this Contract, and comply with all laws, ordinances and regulations affectingthe Property. If a repair required of Purchaser relates to an insured casualty, Purchaser shall not be responsible for performing suchrepair if Vendor does not make available to Purchaser the insurance proceeds therefor.

Vendor agrees that if the purchase price with interest is fully paid and all conditions fully performed as specified herein, Vendorwill execute and deliver to Purchaser a Warranty Deed in fee simple of the Property, free and clear of all liens and encumbrances,except those created by the act or default of Purchaser, and:

CHOOSE ONE OF THE FOLLOWING OPTIONS; IF NO OPTION IS CHOSEN, OPTION A SHALL APPLY:A. Purchaser states that Purchaser is satisfied with the title as shown by the title evidence submitted to Purchaser for

examination, at the time of execution of this Contract.

B. Purchaser states that the following exceptions set forth in the title evidence submitted to Purchaser for examination, at thetime of execution of this Contract, are unsatisfactory to Purchaser:

C. No title evidence was provided prior to execution of this Contract.

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Page 3 of 4, WB-24statements, and in the case of a conversion condominium property information) as required by Wisconsin Statutes §703.33 no later than 15days prior to closing and any amendment to these materials promptly after it's adoption (except as limited for small residentialcondominiums per Wisconsin Statutes §703.365). These materials are available at cost from the condominium association. As provided inWisconsin Statutes §703.33(4), Buyer may, within five business days after receipt of these documents, including any material modificationthereto, rescind this Option by written notice mailed or delivered to Seller, the date of mailing or actual delivery being the effective date of notice.TITLE EVIDENCE

FORM OF TITLE EVIDENCE: Seller shall give evidence of title in the form of an owner's policy of title insurance in the amount of thepurchase price on a current ALTA form issued by an insurer licensed to write title insurance in Wisconsin. CAUTION: IF TITLEEVIDENCE WILL BE GIVEN BY ABSTRACT, STRIKE TITLE INSURANCE PROVISIONS AND INSERT ABSTRACT PROVISIONS.

PROVISION OF MERCHANTABLE TITLE: Seller shall pay all costs of providing title evidence. For purposes of closing, title evidence shallbe acceptable if the commitment for the required title insurance is delivered to Buyer's attorney or Buyer not less than 3 business daysbefore closing, showing title to the Property as of a date no more than 15 days before delivery of such title evidence to be merchantable, subjectonly to liens which will be paid out of the proceeds of closing and standard title insurance requirements and exceptions, asappropriate. CAUTION: BUYER SHOULD CONSIDER UPDATING THE EFFECTIVE DATE OF THE TITLE COMMITMENT PRIORTO CLOSING OR A "GAP ENDORSEMENT" WHICH WOULD INSURE OVER LIENS FILED BETWEEN THE EFFECTIVE DATEOF THE COMMITMENT AND THE DATE THE DEED IS RECORDED.

TITLE ACCEPTABLE FOR CLOSING: If title is not acceptable for closing, Buyer shall notify Seller in writing of objections to title bythe time set for closing. In such event, Seller shall have a reasonable time, but not exceeding 15 days, to remove the objections, andthe time for closing shall be extended as necessary for this purpose. In the event that Seller is unable to remove said objections, Buyershall have 5 days from receipt of notice thereof, to deliver written notice waiving the objections, and the time for closing shall beextended accordingly. If Buyer does not waive the objections, this Option shall be null and void. Providing title evidence acceptable forclosing does not extinguish Seller's obligations to give merchantable title to Buyer.

SPECIAL ASSESSMENTS: Special assessments, if any, for work actually commenced or levied prior to date this Option is exercisedshall be paid by Seller no later than closing. All other special assessments shall be paid by Buyer. CAUTION: Consider a specialagreement if area assessments, property owner's association assessments or other expenses are contemplated. "Other expenses"are one-time charges or ongoing use fees for public improvements (other than those resulting in special assessments) relating tocurb, gutter, street, sidewalk, sanitary and stormwater and storm sewer (including all sewer mains and hook-up and interceptorcharges), parks, street lighting and street trees, and impact fees for other public facilities, as defined in Wis. Stat. §66.55(1)(c) & (f).

Unless otherwise stated in this Option, any signed document transmitted by facsimile machine (fax) shall be treated in all manner and respectsas an original document and the signature of any Party upon a document transmitted by fax shall be considered an original signature. Personaldelivery to, or actual receipt by, any named Buyer or Seller constitutes personal delivery to, or actual receipt by Buyer or Seller. Oncereceived, a notice cannot be withdrawn by the Party delivering the notice without the consent of the Party receiving the notice. A Party maynot unilaterally reinstate a contingency after a notice of a contingency waiver has been received by the other Party. The deliveryprovisions in this Option may be modified when appropriate (e.g., when mail delivery is not desirable (see lines 203-209). Buyerand Seller authorize the agents of Buyer and Seller to distribute copies of the Option to Buyer's lender, appraisers, title insurance companiesand any other settlement service providers for the transaction as defined by the Real Estate Settlement Procedures Act (RESPA).

DELIVERY/RECEIPT

DATES AND DEADLINESDeadlines expressed as a number of "days" from an event, such as exercise of this Option, are calculated by excluding the day theevent occurred and by counting subsequent calendar days. The deadline expires at midnight on the last day. Deadlines expressed asa specific number of "business days" exclude Saturdays, Sundays, any legal public holiday under Wisconsin or Federal law, and otherday designated by the President such that the postal service does not receive registered mail or make regular deliveries on that day.Deadlines expressed as a specific number of "hours" from the occurrence of an event, such as receipt of a notice, are calculated fromthe exact time of the event, and by counting 24 hours per calendar day. Deadlines expressed as a specific day of the calendar year oras the day of a specific event, such as closing, expire at midnight of that day.FIXTURES A "fixture" is defined as an item of property which is physically attached to or so closely associated with landor improvements so as to be treated as part of the real estate, including, without limitation, physically attached itemsnot easily removable without damage to the Property, items specifically adapted to the Property, and items customarilytreated as fixtures.ENTIRE CONTRACT This Option, including any amendments to it, contains the entire agreement of the Buyer and Seller regardingthe transaction. All prior negotiations and discussions have been merged into this Option. This agreement binds and inures to thebenefit of the Parties to this Option and their successors in interest.DEFAULT Seller and Buyer each have the legal duty to use good faith and due diligence in completing the terms and conditionsof the terms of purchase after exercise of this Option. A material failure to perform any obligation under the terms of purchase afterexercise of this Option is a default which may subject the defaulting party to liability for damages or other legal remedies.

If Buyer defaults under the terms of purchase after exercise of this Option, Seller may:(1)(2)

(1)(2)

sue for specific performance and request the earnest money as partial payment of the purchase price; orterminate the purchase agreement and have the option to sue for actual damages.

If Seller defaults under the terms of purchase after exercise of this Option, Buyer may:sue for specific performance; orterminate the purchase agreement and sue for actual damages.

In addition, the Parties may seek any other remedies available in law or equity.The Parties understand that the availability of any judicial remedy will depend upon the circumstances of the situation and the

discretion of the courts. If either Party defaults, the Parties may renegotiate the terms of purchase or seek nonjudicial dispute resolutioninstead of the remedies outlined above. By agreeing to binding arbitration, the Parties may lose the right to litigate in a court of law thosedisputes covered by the arbitration agreement.RENTAL WEATHERIZATION Unless otherwise agreed Buyer shall be responsible for compliance with Rental Weatherization Standards(Wis. Adm. Code Comm. 67), if applicable.

Produced with ZipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com Untitled

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PROPERTY ADDRESS: [page 4 of 4, WB-24]AUTHORIZATION FOR INSPECTIONS AND TESTS Buyer is authorized to conduct the following inspections and tests (see lines 110-121). INSPECTIONS:

TESTS:

DELIVERY OF DOCUMENTS AND WRITTEN NOTICES Unless otherwise stated in this Option, delivery of documents and writtennotices to a Party shall be effective only when accomplished by one of the methods specified at lines 203-212.(1) By depositing the document or written notice postage or fees prepaid in the U.S. Mail or fees prepaid or charged to an accountwith a commercial delivery service, addressed either to the Party, or to the Party's recipient for delivery designated at lines 206 or 208(if any), for delivery to the Party's delivery address at lines 207 or 209.Seller's recipient for delivery (optional):Seller's delivery address:Buyer's recipient for delivery (optional):Buyer's delivery address:(2) By giving the document or written notice personally to the Party or the Party's recipient for delivery if an individual is designated at lines 206 or 208.(3) By fax transmission of the document or written notice to the following telephone number:Buyer: ( ) Seller: ( )

TIME IS OF THE ESSENCE "Time is of the Essence" as to payment of option fees and extension fee and all other dates anddeadlines in this Option except: . If "Time is of the Essence"applies to a date or deadline, failure to perform by the exact date or deadline is a breach of contract. If "Time is of the Essence" does notapply to a date or deadline, then performance within a reasonable time of the date or deadline is allowed before a breach occurs.

This Option (is)(is not) STRIKE ONE assignable. This Property (is) (is not) STRIKE ONE homestead property.ADDITIONAL PROVISIONS

ADDENDA The attached is/are made part of this Option.IF GRANTED, THIS OPTION CAN CREATE A LEGALLY ENFORCEABLE CONTRACT. BOTH PARTIES SHOULD READ THISOPTION AND ALL ATTACHMENTS CAREFULLY. BROKERS MAY PROVIDE A GENERAL EXPLANATION OF THEPROVISIONS OF THE OPTION BUT ARE PROHIBITED BY LAW FROM GIVING ADVICE OR OPINIONS CONCERNINGYOUR LEGAL RIGHTS UNDER THIS OPTION OR HOW TITLE SHOULD BE TAKEN AT CLOSING IF THE OPTIONIS EXERCISED. AN ATTORNEY SHOULD BE CONSULTED IF LEGAL ADVICE IS NEEDED.This Option was drafted on [date] by [Licensee and Firm] .

(x)Buyer's Signature Print Name Here: Social Security No. or FEIN (Optional) Date

(x)Buyer's Signature Print Name Here: Social Security No. or FEIN (Optional) Date

SELLER GRANTS THIS OPTION. THE WARRANTIES, REPRESENTATIONS AND COVENANTS MADE IN THISOPTION SURVIVE CLOSING AND THE CONVEYANCE OF THE PROPERTY. THE UNDERSIGNED HEREBY AGREES TOCONVEY THE ABOVE-MENTIONED PROPERTY ON THE TERMS AND CONDITIONS AS SET FORTH HEREIN ANDACKNOWLEDGES RECEIPT OF A COPY OF THIS OPTION.

(x)Seller's Signature Print Name Here: Social Security No. or FEIN (Optional) Date

(x)

Seller's Signature Print Name Here: Social Security No. or FEIN (Optional) Date

This Offer was presented to Seller by a.m./p.m., at,on

THIS OPTION IS REJECTEDSeller Initials Date

THIS OPTION IS COUNTERED [See attached counter]Seller Initials Date

By signing below and delivering this notice (see lines 201-212) Buyer exercises the Option to Purchase.

(x)Buyer's Signature

NOTICE OF EXERCISE OF OPTION

Date(x)

Buyer's Signature Date


WISCONSIN REALTORS® ASSOCIATION4801 Forest Run Road RESIDENTIAL LEASEMadison, Wisconsin 53704

This Agreement for the lease of the Premises identified below is entered into by and between the Landlord and Tenant (referred in thesingular whether one or more) on the following terms and conditions:

PARTIES TENANT(S)

LANDLORD Name:Address:Landlord's Agent for maintenance, management, service of process and collection of rent - (Note in "Special Conditions" if more than oneagent)Name:Address:

PREMISES PREMISES Street Address:City/State/Zip:

TERM RENTAL TERM:Apartment/Unit/No.:First Day of Term: Last Day of Term:This agreement is only for the stated term and is NOT automatically renewable. Landlord and Tenant must agree in writing if tenancy is tocontinue beyond the last day of the rental term.

UTILITIES Tenant must pay all utility charges that are separately metered or subject to cost allocation, as follows:Utility Charges Electric Heat Water Bill Unit Gas Air Conditioning Hot Water Trash / RecyclingIncluded in RentSeparately MeteredCost Allocation *

* See Special Conditions.RENT Rent Amount $ per due on or before the day

of each , Rent checks shall be made payable to (Landlord) (Landlord's Agent) [STRIKE ONE] and mailedor delivered to (Landlord) (Landlord's Agent) [STRIKE ONE] . ALL TENANTS, IF MORE THAN ONE, SHALL BE JOINTLY ANDSEVERALLY LIABLE FOR THE FULL AMOUNT OF ALL PAYMENTS DUE UNDER THIS AGREEMENT.

SECURITY Upon execution of this Agreement, Tenant agrees to pay a security deposit in the amount of $DEPOSIT . The deposit, less any amounts legally withheld, will be

returned in person or mailed to Tenant's last known address within 21 days after Tenant surrenders the Premises. Tenant is responsible forgiving Landlord his/her new address. Surrender shall occur on the last day of the term provided in this Rental Agreement, subject to theexceptions described in Wis. Admin. Code § ATCP 134.06. Upon surrender, Tenant shall vacate the Premises and return, or account for,any of Landlord's property held by Tenant, such as keys, garage door openers, etc.

to be held by

CHECK-IN Tenant acknowledges receipt of Landlord's check-in report which tenant agrees to complete and return to Landlord by the 8th day of thetenancy. Tenant may request, in writing, a list of physical damages and defects charged to the previous tenant's security deposit no laterthen the 8th day of the tenancy.

REPORT

SPECIAL Special Conditions:CONDITIONS

Landlord may enter the Premises occupied by the Tenant, at reasonable times with at least 12 hours advance notice, to inspect thePremises, make repairs, show the Premises to prospective tenants or purchasers, or comply with applicable laws or regulations. Landlordmay enter without advance notice upon consent of the Tenant, when a health or safety emergency exists, or if Tenant is absent andLandlord believes entry is necessary to protect the Premises or the building in which they are located from damage.

LANDLORD'SRIGHT TOENTER

ABANDONMENT If Tenant unjustifiably removes from the Premises before the last day of the rental term, Tenant shall be liable for all rent due under thisAgreement through the last day of the term, plus damages incurred by Landlord, and less any net rent received by Landlord in rerenting thepremises. If Tenant is absent from the Premises for three consecutive weeks without written notice of such absence to Landlord, Landlordmay, in Landlord's sole discretion, deem that Tenant has removed from the Premises and proceed to rerent the Premises. If Tenant leavespersonal property behind, Landlord shall have the right to dispose of the property as provided by law or per any written property lienagreement.Upon voluntary or involuntary transfer of ownership of the Premises, Landlord's obligations under this Agreement are expressly released byTenant. The new owner of the Premises shall be solely responsible for the Landlord's obligations under this Agreement.

SALE OF PROPERTY

Tenant has received, read and understands Landlord's lead-based paint (LBP) disclosures and the Protect Your Family From Lead In YourHome Pamphlet (Pamphlet). Tenant agrees to follow the practices recommended in the Pamphlet in order to protect Tenant and otherguests and occupants from injuries caused by exposure to lead. Tenant shall immediately notify the Landlord in writing if Tenant, Tenant'sguests or any other occupant observes any other conditions indicating the presence of a potential LBP hazard, as described in the Pamphlet.

LEAD-BASED PAINTPROVISIONS (Applicableonly if the Premises is a "targetproperty" constructed before 1978.)


Wisconsin REALTORS Association

Wisconsin REALTORS Association 4801 Forest Run Rd Ste 201 Madison, WI 53704(608)241-2047 Jennifer Lindsley Untitled

During the lease term, as a condition of Tenant's continuing right to use and occupy the Premises,

To use the Premises for residential purposes only for Tenant and Tenant's immediate family.To NOT make or permit use of the Premises for any unlawful purpose or any purpose that will injure the reputation ofthe Premises or the building of which they are a part.To NOT use or keep in or about the Premises anything that would adversely affect coverage of the Premises or the building ofwhich they are a part under a standard fire or extended insurance policy.To NOT make excessive noise or engage in activities which unduly disturb neighbors or other tenants in the building in whichthe Premises are located.To NOT permit in or about the Premises any pet unless specifically authorized by Landlord in writing.PETS

GOVT. REG. To obey all lawful orders, rules and regulations of all governmental authorities and, if a condominium, any condominium associationwith authority over the premises.To keep the Premises in clean and tenantable condition and in as good repair as on the first day of the lease term, normal wear and tearMAINTENANCEexcepted.To maintain a reasonable amount of heat in cold weather to prevent damages to the premises, and if damage results from Tenant's

Unless Tenant has received specific written consent from Landlord, to NOT do or permit any of the following:IMPROVEMENTS

b. Alter or redecorate the Premises.c. Drive nails, tacks, and screws or apply other fasteners on or into any wall, ceiling, floor, or woodwork of the Premises.d. Attach or affix anything to the exterior of the Premises or the building in which it is located.To NOT permit any guest or invites to reside in the Premises without prior written consent of Landlord.GUESTS

NEGLIGENCE To be responsible for all acts of negligence or breaches of this agreement by Tenant and Tenant's guests and invitees, and to beliable for any resulting property damage or injury.To NOT assign this Agreement nor sublet the Premises or any part thereof without the prior written consent of Landlord. If Landlordpermits an assignment or a sublease, such permission shall in no way relieve Tenant of Tenant's liability under this Agreement.

VACATION OF To vacate the Premises at the end of the term, and immediately deliver the keys, garage door openers, parking permits, etc., and theTenant's forwarding address to the Landlord.PREMISES

Landlord may make additional reasonable rules governing the use and occupancy of the Premises and the building in which they are located.Tenant acknowledges the rules stated above, and acknowledges receipt of any additional rules prior to signing this Agreement. Any failure byTenant to comply with the rules is a breach of this Agreement.

RULES

DAMAGE BY If the Premises are damaged by fire or other casualty to a degree that renders them untenantable, Tenant may move out unless Landlordpromptly proceeds to repair and rebuild. Tenant may move out if the repair work causes undue hardship. If Tenant remains; rent abates to theextent Tenant is deprived of normal full use of the Premises, until the Premises are restored. If repairs are not made, this Agreement shallterminate. If the Premises are damaged to a degree which does not render them untenantable, Landlord shall repair them as soon asreasonably possible.

CASUALTY

The Premises and the building of which they are a part are NOT currently cited for uncorrected building or housing code violations unless a copyof any such notices of uncorrected code violations are attached to this Agreement. The Premises do NOT contain any of the following conditionsadversely affecting habitability unless listed under Special Conditions: No hot or cold running water, plumbing or sewage disposal facilities not ingood operating order, unsafe or inadequate heating facilities (incapable of maintaining at least 67ºF in living areas), no electricity, electricalwiring or components not in safe operating condition, or structural or other conditions that are substantially hazardous to health or safety.

CODEVIOLATIONSCONDITIONSAFFECTINGHABITABILITY

Wisconsin law requires that the Landlord maintain any smoke detectors located in any building common areas. State law furtherrequires that THE TENANT MUST EITHER MAINTAIN ANY SMOKE DETECTOR ON THE PREMISES, OR GIVE LANDLORD WRITTENNOTICE WHENEVER A SMOKE DETECTOR ON THE PREMISES IS NOT FUNCTIONAL. The Landlord shall provide, within five days ofreceipt of any such notice, any maintenance necessary to make that smoke detector functional. MAINTENANCE SHALL INCLUDE THEPROVISION OF NEW BATTERIES, AS NEEDED.

SMOKEDETECTORNOTICE

Tenant understands that any property manager, rental agent or employees thereof are representing the Landlord.AGENCY NOTICE

Attachments checked below are attached to this Rental Agreement and incorporated herein by reference.Attachment Check Attachment

Guarantee/Renewal/Assignment/Sublease Code ViolationsRules and Regulations Real Estate Agency DisclosureLead-Based Paint Disclosure & Pamphlet Other:

IN WITNESS WHEREOF, the parties have executed this Rental Agreement on

TENANTS:LANDLORD:

TENANTS:

Copyright © August 2002 by Wisconsin REALTORS® Association, Inc., 4801 Forest Run Road. Madison, WI 53704. To order contact the Wisconsin REALTORS® Association, (608) 241-2047.No representation is made as to the legal validity of any provision or the adequacy of any provision in any specific transaction.

1.

TENANT RULES& OBLIGATIONSUSE

2.

3.

4.

5.6.

7.

8.

9.failure to maintain a reasonable amount of heat, Tenant shall be liable for this damage.

a. Paint upon, attach, exhibit, or display in or about the Premises any sign or placard.

10.11.

12.

13.

Check

Drafted by Attorney Debra Peterson Conrad

.

Nonstandard Rental Provisions Other:

Notice: You may obtain information about the sex offender registry and persons registered with the registry by contacting the Wisconsin Department of Corrections onthe Internet at http://www.widocoffenders.org or by phone at 877-234-0085.

Tenant agrees and promises, unless Landlord otherwise provides in writing, as follows:


DISTANCE LEARNING ON DEMAND - WRA

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