NVAR Standard Forms Changes Effective July 1, 2019; Attend Class on 6/27
You’re invited to learn about updates to NVAR Contract Forms on Thursday, June 27, 2019, 10AM-12PM, DAAR, Ashburn. Featured speaker Sarah Louppe Petcher, S & T Law Group, will review and answer key questions regarding the changes effective July 1st, 2019. Free for DAAR Members. Register online here. For more information, view the flyer.
NVAR forms changes effective July 1st, 2019:
1. Residential Sales Contract – K1321ED– This form has been substantially modified in conjunction with revisions to the financing contingencies. The definition of Seller Subsidy can now be found in the Definitions Paragraph of the Contract and is removed from the financing contingencies. The Buyer Representations paragraph has been modified to remove authorization to the cooperating brokerage to provide buyer financial information since this is redundant with Paragraph 2. The most substantive change is to page 1, which has been modified for clarity. The necessary information to review the offer, including sales price, amount of loan and type of loan, remains on the first page of the contract, but Specified Financing, Alternative Financing, and Assumption terms are now contained in the relevant financing contingencies. The contract has been shortened by 1 page without significantly lengthening the financing contingencies!
2. Conv Financing Contingency – K1359ED, FHA Financing Contingency – K1340ED, VA Financing Contingency – K1339ED, and USDA Financing Addendum – K1372ED– These forms have been modified to more clearly define Specified Financing, how the contingency is satisfied/removed and the consequences for switching to Alternative Financing. The contingencies have also been modified to include 2 options for the Seller and Buyer to negotiate upfront, similar to the Home Inspection Contingency. The first option, called the Contingency with Automatic Extension, is essentially the current financing contingency. A second option, called the Contingency with Automatic Expiration, has been added for Sellers and Buyers to choose a contingency that automatically expires at the Financing Deadline. Reference to the Seller Subsidy has been removed since it is a defined term in the Contract. Assumption terms have been added to the FHA, VA and USDA Financing Contingencies.
3. Exclusive Right to Sell – K1336ED, Exclusive Agency Listing Agreement – K1337ED, Exclusive Right to Sell Unimproved Land – K1355ED , Exclusive Right to Lease – K1281ED – These brokerage agreements have all been modified to explicitly state that the Listing Broker is not obligated to continue to market and show the Property after a contract/lease has been ratified unless otherwise instructed in writing by the client. This creates a default option once the parties have gone under contract. If a NVAR Seller/Landlord wishes to continue to the market the property post-ratification, they can instruct the Listing Broker in writing. The Exclusive Right to Lease Listing Agreement has also been modified to inform landlords that the NVAR Common Law Lease is no longer available. If landlords are eligible to opt-out of the VRLTA and wish to do so, they may seek professional advice on drafting a lease.
4. Coming Soon Addendum – K1369ED – This form has been updated to remove references to MRIS and reorganizes the selection options to emphasize the discussion regarding listing the property in the MLS.
5. Exclusive Right to Represent Tenant – K1282ED – This form has been modified to include a warning to Tenant to not take videos or photos of other people’s property without authorization, similar to the warning in the Exclusive Right to Represent Buyer Agreement.
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