FMLS and GAMLS now have the new GAR contracts available. As always, be sure to familiarize yourself with the new agreements BEFORE you ask a client or customer to sign the documents. Although some of the changes merely affected the layout and were intended to make the forms easier to read, there were several substantive changes.
Among the changes is a more restrictive right to unilaterally extend the day of closing. The seven day period is still part of the form, but the basis for extension is now limited to delays caused by title, lender or attorney issues.
A major change modified the financing contingency. Buyers will be able to negotiate a "financing contingency period" during which the buyer must make arrangements for any loans necessary to purchase the real estate. If the buyer fails to provide a lender rejection letter during that period, the new agreement considers the loan approved and eliminates the financing contingency.
The new contract imposes a duty on the buyer to inspect the neighborhood for factors that may be detrimental to enjoyment of the property being purchased. The buyer has also been given the responsibility of obtaining a termite inspection. Now, when a buyer contracts using the new forms, the termite inspection will be ordered in the same manner as the buyer orders the home inspection.
Email is now permitted as a means of providing notice - but only to the extent that an email address is provided in the contract.
Other changes include the addition of a due diligence period in the right to terminate section, changes to the lead-based paint clauses, etc. Get into a new contracts review class and be sure you are up on the changes before you ask your client to sign.
AREA can assist. Depending upon the size of your office, a class might be able to come to you. Contact an administrator for details 770-591-5552.
