Of the many Member Benefits of belonging to the Greater San Diego Association of REALTORS® (GSDAR), few are heralded as much as GSDAR’s Risk Management Committee. This Committee is comprised of: 1. the best local real estate Attorneys in the industry; 2. Brokers from various business models; and, 3. frequent visits by various levels of law enforcement, including the California Department of Real Estate (DRE), the Federal Bureau of Investigation (FBI), and, the San Diego District Attorney’s Office (DA), etc.
GSDAR monitors the content and use of forms at both the local and state levels, and, many of the forms designed at GSDAR to protect our local REALTORS® make their way rapidly across the state. Your input really does matter!
As you are aware, the California Association of REALTORS® (C.A.R.) updates their forms (normally) twice per year; generally, this is in response to Litigation and (upcoming) Legislation! The key legislative dates are the first of the year (1 January), and mid-year (1 July)! GSDAR updates their forms on an “as needed” basis, and, those updates are continually (as you can imagine) in progress!
C.A.R. will release another “publish” of forms in the ZipForms® library during the week of 10 December 2018. There will be FOUR (4) “new” forms, and, ELEVEN (11) “revised” forms! There are additional “soft publishes” throughout the year, but these are usually intended to fix minor errors discovered in the state forms. Regardless of the type of “publish”, rest assured that those updates will never alter a transaction that you have in process. Updates are only upgraded in your “Forms Library”, your Templates, or, when you add an “updated” form to your transaction. As a practitioner (much like yourself), I see these changes as “job security”, because I stay updated on the tools of my industry! You are doing that now!
So, how do we find these forms changes? It’s simple; watch for updates from YOUR Greater San Diego Association of REALTORS®! What are these new changes, and, how are they going to affect you? Let’s take a look!
1. Buyer Pre-Occupancy Storage Addendum (C.A.R. Form POSA)—C.A.R. calls this a “form of last resort”. I agree. The practice of allowing a Buyer to store their personal property at the Seller’s real property, prior to close of escrow, is a dangerous one. This form should be used expeditiously; you don’t have to be in the industry very long to know why this is RARELY a good idea.
2. Seller Common Interest and HomeOwners Association (HOA) Questionnaire (C.A.R. Form SCIQ)—this form asks the Seller to disclose information that might not be readily available from an HOA. Some items (such as common area facilities, parking, storage, etc.) may be important and not provided in a timely manner by the HOA.
3. Seller Manufactured/Mobile Home Park/Community Questionnaire—this form asks the Seller to give information to the purchaser of a Manufactured/Mobile Home that might not otherwise be contained in documentation provided by an HOA.
4. Summary of Offer (C.A.R. Form Sum-RIPA)—this is a document that can be attached to a Residential Income Purchase Agreement that would summarize some of the key terms of the offer; it is similar to the existing form for the Residential Purchase Agreement.
1. Bed Bug Disclosure (C.A.R. Form BBD)—this form puts an affirmative obligation on the Tenant to inform the Owner/Landlord of any evidence of bed bug issues, as well as indicating a waiver of liability for failure to do so.
2. Commercial Confidentiality and Non-Disclosure Agreement (C.A.R. Form CML-CNDA)—language was added to this form that addresses the effective date of notices and duplicate notices sent via other means.
3. HomeOwner Association Information Request (C.A.R. Form HOA1)—this form requests that the HOA respond within the statutory time period by completing forms HOA1 & HOA2; it even includes a copy of the statute on the back page.
4. Residential Lease or Month to Month Rental Agreement (C.A.R. Form LR)—there are no changes to this form, but, rather to attachments to it (e.g., Bed Bug Disclosure and Tenant Flood Hazard Disclosure).
5. Receipt for Reports (C.A.R. Form RFR)—this form contains a warning to the Buyer that they may not have standing to pursue the preparer of a report that was forwarded to, but not prepared specifically for, the Buyer.
6. Residential Listing Agreement (C.A.R. Form RLA)—language was added for the Seller to indicate to the Listing Agent that a sale would be contingent on the Seller finding a replacement property.
7. Residential Purchase Agreement (C.A.R. Form RPA)—in order to be consistent with the new NAR Standard of Practice 1-7 (remember the Code of Ethics?), Paragraph E was added to the Broker box on page 10 to automatically have the cooperating Broker make a request that the Listing Broker affirm that the offer has been presented to the Seller.
8. Request for Repair (C.A.R. Form RR)—this addition clarifies the language that “credits” given are in addition to those agreed to in the original purchase agreement.
9. Seller Response and Buyer Reply to Request for Repair (C.A.R. Form RRRR)—the same as above C.A.R. Form RR (credits given are in addition to those agreed to in the original purchase agreement).
10. Seller Multiple Counter Offer (C.A.R. Form SMCO)—added language warning the Seller NOT to sign a second time in Paragraph 8 unless they agreed to any additional counter offer that might have been issued by the Buyer
11. Single Party Compensation Agreement (C.A.R. Form SP)—additional language added to make the form, which currently applies to purchases, now also apply to lease transactions.
12. Tenant Flood Hazard Disclosure (C.A.R. Form TFHD)—switched the default language to indicate that the property is NOT in a flood zone, but, that checking the box affirmatively states that the property IS in a flood zone.
We’ve all heard of C.A.R.’s User Protection Agreement, right? It only applies if you are using the current version of the C.A.R. forms! So, protect yourself, AND, your Broker, by only using the current version of the C.A.R. forms!
And, that’s it! Some significant changes, others that are minor, but the general thrust of it is that your Greater San Diego Association of REALTORS® is always looking out for YOU! At the end of the day, we all experience the highest level of protection from the hard work of the Members of the Greater San Diego Association of REALTORS® Risk Management Committee, as well as the California Association of REALTORS®!
Thank you, All, be profitable, and, we’ll chat with you again next May!