Updates on COVID-19 and Real Estate in Pennsylvania
Editor’s Note: As the impact of COVID-19 (coronavirus) is fluid, information in this article was correct at the time of posting and may be out of date at the time you are reading it. For the most up-to-date guidance on coronavirus, please visit PARealtors.org/coronavirus.
You’ve got questions. Lots of questions.
At this point, things are changing day by day – sometimes even hour by hour. And since real estate transactions are dependent on so many third-party service providers, the complexity of each individual question is complicated by many orders of magnitude. To be perfectly honest, right now we have just as many questions as you do, and very few firm answers.
But we’re working on it. Even if you can’t see the results just yet, PAR is working hard to get information and answers to help our members and their clients in these difficult times. Here’s a snapshot of the things we’ve been doing, and some tips on the sorts of questions you should be asking about your transactions to assess how to move forward the best that you can.
License Renewal/Continuing Education
The current license renewal cycle ends on May 31, so licensees ordinarily would need to complete continuing education and complete their renewals through the Department of State’s Pennsylvania Licensing System (PALS) by that date. Many members have asked if these deadlines will be extended now that the relevant state offices are closed or cut back and most real estate schools have canceled in-person classes.
PAR has been in constant contact with the State Real Estate Commission and the Bureau of Professional and Occupational Affairs to express our concerns and ask for extensions. They are currently working through their options and we hope to have a response shortly.
IN THE MEANTIME: There are various sources for online education, and many local associations have partnerships with these providers. Members who still need continuing education credits can certainly look to these resources if they don’t want to wait to see when in-person classes may be available again.
Successfully closing a transaction involves lots of contact with various county and municipal governments for things like property inspections, tax payments and deed recording. Unfortunately, each government office is operating under its own policies at the moment, so it’s unclear just what services are available in each area. Some government offices are still operating under their regular policies, some have shut down completely and many are somewhere in the middle.
PAR has been in touch with many statewide organizations including the Pennsylvania Recorder of Deeds Association, Pennsylvania Land Title Association and Pennsylvania State Association of Township Supervisors, among others, to explain how this patchwork approach is making real estate transactions extremely difficult and to try to work towards a common solution. This will be an ongoing discussion with many facets, and we’re working to provide member resources as we’re able to collate that information.
IN THE MEANTIME: Information about the county recorders of deeds has been compiled by the Pennsylvania Land Title Association. Limited information about state and county court operations are available through the Unified Judicial System of Pennsylvania. This information may change frequently, so members should call county courthouses or municipal offices regularly to assess their functionality.
Title Companies and Closings
Reports from across the state indicate that the actual physical closing process is being handled differently. Some title companies are doing business as usual with in-person closings – though often with additional distancing between the parties (e.g., buyer and seller in separate rooms with separate paperwork and pens). Some are handling things remotely as much as they can (parties signing and notarizing separately off-site). And unfortunately, some are closing down for business altogether. In some cases, even if the title companies are willing to close the transaction their inability to perform certain ancillary items (such as an inability to file the deed if a recorder is shut, or an inability to get tax certificates and utility payoffs from a shuttered municipality) is forcing delays.
Part of our discussions with the Land Title Association is focused on ensuring that title services are available as widely as possible, and we will continue to work with them to provide additional information to members.
IN THE MEANTIME: Call the title companies that are scheduled to handle your closings and ask them what limitations they’re experiencing. If one company can’t accommodate a closing, it may be necessary to seek out another provider that can handle the transaction.
Forms and Extensions
There are a lot of transactions hitting speedbumps of various sorts because of the unavailability of resources and/or service providers. Many members have been drafting some sort of contract extension language and have been asking PAR for a state standard form.
Staff and counsel have reviewed various forms options and have been hard at work drafting possible language. Without getting into all the detail, let’s just say that there’s a delicate balance between speed and comprehensiveness, and we want to make sure we’re not going to write something that actually adds confusion to the market. More information will be made available in the next several days.
IN THE MEANTIME: If your transaction needs extended time frames, there’s already a form for that – the Change in Terms Addendum (Form CTA) allows the parties to change any deadline in the Agreement by mutual agreement.
Given that the bulk of Realtors® are independent contractors, there’s been a great deal of concern over whether and how any governmental aid would impact members. NAR has been pushing for independent contractors to be included in federal legislation, and there are some helpful provisions in the bill that was just passed. More information is available through NAR, and we expect further clarification will be made available.
The Pennsylvania Association of Realtors® is posting new information on its coronavirus webpage at PARealtors.org/Coronavirus to help Realtors® navigate the challenges posed by the pandemic.