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Agreement of Sale to be Updated July 1

By: Desiree Brougher, Esq. on in

No form in the PAR library is amended as frequently as the Standard Agreement for the Sale of Real Estate, Form ASR.

Several of the most recent changes were made without an accompanying change to the other sales agreements in our repertoire. Now beginning July 1, all of the agreements should have the following elements to them, where applicable:

  • Fixtures and personal property – a note about fixtures and the lists of inclusions, exclusions and items subject to financing arrangements should be similar.
  • Inspection limitations and reports – all contracts should have the standard language limiting the scope of a pre-settlement walkthrough inspection and people who may attend the inspections. Also, the language that the buyers will provide inspection reports to the sellers in all circumstances has been added.
  • Internet of Things and recordings – all agreements (except for vacant land) should contain a paragraph on the Internet of Things (IoT) and connected devices.

There will also be two new changes to – what else? – Form ASR (and the other sales agreements, of course). Though small, these changes are quite important because they impact the rights and remedies available to your clients under the contract. The first change will affect the buyer’s rights if the seller is unable to transfer anything less than full title. As the form is currently written, if the seller is unable to transfer “good and marketable title” then the buyer’s only option is to terminate the contract; as of July, the buyer will have an additional option of taking “such title as Seller can convey.” This will allow the buyer to choose between taking less-than-perfect title and terminating the agreement.

The second change is to the paragraph of the agreement addressing mediation. Mediation is the preferred method of settling disputes between buyers and sellers, but while the parties wait for the process to take its course the aggrieved party might be running out of valuable time to preserve rights available to them under contract law. The new language gives either party permission to file whatever claims may be necessary in an appropriate court of law while mediation takes place.

Therefore, the following forms will be updated as of July 1:

To view the redlined samples, be sure to be logged into the PARealtors.org website and visit the individual form pages. Then click on “view the redlined version” under the download button.

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Comments (24)

Comments

  • Judith Alignan   June 19, 2020 at 7:51 am

    Great work! I’m looking forward to participating in the Standard Forms Feedback sessions again in the fall, I hope! I highly recommend participation to all members who care to have their concerns not only heard, but addressed!

    Reply to Judith Alignan
  • Kolawole Ojulari   June 19, 2020 at 8:25 am

    Why should a seller be given full inspection report that they did not pay for?

    Reply to Kolawole Ojulari
  • Ed Sinkovitz   June 19, 2020 at 8:29 am

    Thank You For The Clairity.With the Changes

    Reply to Ed Sinkovitz
  • Richard H Long   June 19, 2020 at 8:49 am

    Your Missing a Single page Seller Disclosure for Estate Sales listings. Makes no sense to have 11 page blank for Executor/Executrix to sign…waste of time and paper.

    Reply to Richard H Long
  • Terry Abbott - Berkshire Hathaway Homeservices in Mt. Lebanon, PA   June 19, 2020 at 9:18 am

    I think (and honestly thought it was) it should be mandatory that a seller’s disclosure be available on line to anyone previewing a house. Last week I had to contact a ReMax agent for one and I’ve done this before – sometimes it takes
    a few days to get it. Why is this not mandatory as part of the listing agreement to provide to would be buyers when they first look at a house.

    Reply to Terry Abbott - Berkshire Hathaway Homeservices in Mt. Lebanon, PA
  • Robert A. Rabuttinio   June 19, 2020 at 9:43 am

    I agree with Kolawole Ojulari.. Also; Seller shall have the option to not review inspection report and therefor deny.

    Reply to Robert A. Rabuttinio
  • Grace Mengel   June 19, 2020 at 9:58 am

    Re: Buyers will provide inspection reports to sellers in all circumstances. Why? The report needs to be supplied to back up any repair requests but if the seller does not want the report force feeding only creates problems, “if requested” is a better option.

    Reply to Grace Mengel
  • Alex Camaerei   June 19, 2020 at 9:59 am

    I still think the AOS lacks adequate protection for a seller. What if a seller has a major change in their financial status (which is especially relevant during a pandemic)? There’s no protection for that in the AOS.

    Reply to Alex Camaerei
  • Roy L Hollinger   June 19, 2020 at 10:00 am

    I agree also, with Kolawole, i find some home inspectors emphasizing their pet favorite problems and never find two home inspector reports sounding alike. Why should the seller be stuck and even hindered by one persons opinion who do not represent them. .

    Reply to Roy L Hollinger
  • Chris Gilbert   June 19, 2020 at 11:11 am

    Will this mean the seller can deny certain inspectors access if they have to live with the report?

    Reply to Chris Gilbert
  • Richard Calderon   June 19, 2020 at 5:18 pm

    These unregulated pompis attitude home inspectors are out of control! Why does not NAR/PAR nip this now! Most are uneducated in basic construction, older homes always have something wrong! All they do is cost sellers money and create all kinds of problems when a seller disclosure has WORKED for years.

    Reply to Richard Calderon
  • Cheryl Jacobs   June 20, 2020 at 8:38 am

    Isn’t posting a Seller Disclosure on the MLS for every licensed agent to access a breach of CONFIDENTIALITY of a Seller? I do not agree with this convenient but seemingly non-professional allowance. Please do not make this mandatory, as has been requested in an above comment. If a Buyer agent requests a SPD before a preview of a scheduled appointment then the professional listing agent should respond by sending it to the interested requested agent for the purpose of the showing of the property or leave a copy at the property for review and make note of that in the agent section of the MLS.

    Reply to Cheryl Jacobs
  • Elena Quinn   June 20, 2020 at 8:48 am

    After working in the PA real estate business For over 20 plus years, I agree, a one page seller’s disclosure form is warranted for Estate Sales. Also, home inspections: if PAR is now saying, all sellers must get the home inspection report from the buyer, should it be stated, “which seller has the right to agree or not to agree with the said report.”

    Reply to Elena Quinn
  • Suznanne Gruneberg   June 20, 2020 at 2:35 pm

    Thanks Desiree. As always, very informative and it’s always good to get a reminder!

    Reply to Suznanne Gruneberg
  • Jerry Shilling   June 20, 2020 at 4:00 pm

    Given the sellers the buyers inspection report should be optional, What I see is the seller than passes it on to the next buyer, yep I know they should not and its not valid if buyer number 2 has issues after settlement but it happens in the real world !!!

    Reply to Jerry Shilling
  • Jack Fleming   June 21, 2020 at 4:48 pm

    If a buyer is requesting inspections they should provide a copy of that report to the sellers. Otherwise the seller will be in dark about the scope and results of the inspections.

    Reply to Jack Fleming
  • Mike Lenhart   June 22, 2020 at 11:03 am

    Thirty-five years ago we had a one page AOS. Yes, we needed changes and those worked out better for everyone. However, now this needs to end. But guess what …. the biggest problem is coming really soon. Amazon, Zillow, Trulia, etc. are the huge factor that nobody wants to face. Our industry will soon be devoured by these humongous companies. Wake up people, Realtors will soon be a lost occupation when these giants take over. Our powers-that-be are fully aware of this problem; however, they don’t know how to stop it. They better figure this out soon. This is absolutely no joke.

    Reply to Mike Lenhart
  • Ryan Thomas   June 22, 2020 at 4:28 pm

    I would agree with the one page spd for estates if there were verbiage in there certifying that they do not have knowledge of any defects. I find far too many agents just saying “you don’t have to fill this out, sign here.” The problem is that they are still required to disclose known material defects. A property being an estate is not permission to hide defects. Also, the seller should have receive a copy of an inspection report if the buyer terminates. The termination implies an issue that the seller should know about in order to disclose. If the desire of not getting the report is to avoid disclosure, then that seems a bit unethical. On the other hand, I would absolutely assume the right to refuse certain inspectors for the weight their opinion holds on a house. But, as agents we need to accept this part of the process and not put a bullseye on every inspector. Yes, there will be issues with every house. That’s why we need to know houses ourselves…. we need to know what we are selling. There will always be the occasional buyer that tries to nickel and dime the seller or the buyer that terminates for no good reason. If the job were easy, everyone would do it and it’s the tough situations were our expertise it the most important.

    Reply to Ryan Thomas
  • Jessie   June 23, 2020 at 9:12 am

    I agree with you. I think that it would be beneficial to the buyer to have all this information first hand before they decide to put a offer in on the property. I know a lot of agents only provide this right before writing up a offer. I do try 110% to have this available at the first showing – only because if my potential buyer has a question, I can quickly look on the SPD and try to find that answer for them.

    Reply to Jessie
  • Lynne Kelleher   June 23, 2020 at 12:08 pm

    How about a statement on the BFI that the Seller agrees to keep the information provided confidential? Know it’s probably not enforceable, put would service as notice to the Seller to be discreet. Had a situation years ago where the Seller blabbed the Buyers financial info to the neighbors…not good!

    Reply to Lynne Kelleher
  • William D. Smulick   June 23, 2020 at 5:30 pm

    I don’t think a buyer should be required to provide a inspection report to the seller. The reports vary on wording comments and recommendations that are not defects etc. Opinions are issues that do not need to be shared

    Reply to William D. Smulick
  • Deborah Friedman   June 24, 2020 at 8:57 am

    Why does the ASR say “minimum term” under mortgage contingency, instead of “maximum term?”

    Reply to Deborah Friedman
  • john burns   June 24, 2020 at 12:35 pm

    Inspectors seem to know a little about alot. If there is a specific issue such as electric or plumbing, hire a professional in that field to verify if there is an issue or not.

    Reply to john burns
  • Lisa Linn   June 27, 2020 at 5:39 pm

    Seems to me the inspection clause changes is going to stir up more issues that will eventually turn into more changes and clauses in the AOS next year…or more addendums. I always only provided the portion of the inspection report to the seller that correlates what the buyer is asking for in a credit or repair. The rest of the report is not really relevant then. Also, the seller needs to disclose known defects, but these reports are sometimes nothing more than “opinions” to be quite frank. I encourage my sellers to have a pre-inspection before listing it and having that report available to buyers. I think this new language is going to open a whole new can of worms in my humble opinion.

    Reply to Lisa Linn

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