The Weekly Membership Newsletter of the Tennessee Assn. of REALTORS
Guest Editor: Buzz Steele


CONTENTS
1. 2009 Documented Form Changes
2.
Notables About form  “F9 Purchase and Sale Agreement”
3. Changes to the inFORM tool
4. There are ONLY 2 Residential Listing Agreements in 2009 ?
5. TransactionDesk – How come I can’t create a 2008 form?


1. 2009 Documented Form Changes
Finally.. It’s here! The documented form changes are now available for download. You can download the PDF by visiting the “NEWSROOM” link on the TAR site (public side). It’s also located on the “Forms on the Fly” page (member side).

The document contains all changes to each form that have occurred. DELETIONS are denoted by strikethrough and RED text. NEW VERBIAGE is denoted by BLUE text. Included is a list of all NEW FORMS and those that have been deleted from inventory.


2. Notables About form  “F9 Purchase and Sale Agreement”
Submitted by: Susan Barnette, GRI Instructor and Residential Forms Committee Member

Guess what? The TAR 2009 Purchase and Sale Agreement has arrived…with some changes! Don’t groan, there are not many changes. However, you may find that they are significant!

This article will not give you EVERY change, just the ones you need to pay close attention to! So let’s get started.

Line 12
Examples of “Window treatments” have been added for clarity (e.g. shutters, blinds, shades, curtains, draperies). This is important for both the Buyer who is asking for items and the Seller who is determining what items will be left with the property at no additional cost to the Buyer. Be VERY specific on lines 19-21 or 23-25 concerning personal property.

Lines 68-93
Make note that the Financial paragraph was re-worked and that some of the blanks are gone concerning term of loan and flat dollar amount.
The types of loans were re-worked to include only the “major” loan types now available to our customers/clients. A major change for you to look for is in the Loan Obligations area on lines 79-82. The Buyer has five days to make loan application, pay fees necessary, etc. and instruct Lender to order credit report and appraisal. Lines 91-93 note a change in the number of days in which the Buyer has to furnish information once demand for compliance has been made.

Lines 105-110
What used to be the “All Cash” or “No Financing Contingency” is the next change. You’ll notice that the number of days for the Buyer to provide proof of available funds to close is pre-printed as five days within the document now. It used to be a blank field.

Lines 134-135 and 140
The word “closing” is defined in the Purchase and Sale Agreement as “delivery of warranty deed and payment of purchase price”.

Line 196
Examples of “cosmetic nature” have been added for clarity (e.g. decorative, color or finish items).

Lines 182-249 – INSPECTION Area of the form
Before we get further into the Inspection Paragraph,  take a look on page 6 and make a special note that the OLD Paragraph 10 – Repairs and Replacement Costs is G-O-N-E!

Too often the Repairs and Replacement Costs paragraph was abused. It was never meant to be an amount that the Buyer would automatically receive. It was meant as a cap / ceiling amount that total costs could not exceed.

Lines 216-218
This area has been changed to reflect the removal of the Repair and Replacement paragraph.

Line 222
Hold on to your hat…the check box for OPTION #1 is also gone!
This paragraph is affectionately known as the “Buyer’s Immediate Opt Out”. Your Buyer now has all three options without having to remember to check any box. You need to make sure your Sellers understand this change.

The other changes in the Inspection Paragraph would require that you look at the form “F4-Buyer Inspection Contingency Removal/Notification” and form “F5-Repair Counter Proposal”. The possibility of an “endless loop” of counter offers flying back and forth between the Buyer and Seller has been put to an end.

Scenario: Buyer has home inspection and presents list of items they would like to be repaired or replaced on form “F4-Buyer Inspection Contingency Removal/Notification” at paragraph number 3 and submits to Seller. Seller receives and says, I will do all but “this” and submits to Buyer form “F5-Repair Counter Proposal”. The Buyer now has ONLY two options – to either Accept the Repair Counter Proposal or Reject the Repair Counter Proposal and “hereby gives notice that Buyer is excising his right to terminate the Purchase and Sale Agreement. See attached Earnest Money Disbursement & Mutual Release form”.

The deletion of the “Repairs/Replacement Costs paragraph” coupled with there no longer being a possibility of an “endless loop” of repair counters may persuade the Buyer and Seller to only negotiate items of utmost importance and concern.

Lines 246-249
If your Buyer wants to waive the home inspection and you check the box at line 246, this action will also waive the termite, radon, all other inspections unless you “except” those specific inspections on lines 248-249.

Line 253
Sentence added:
Property shall remain in such condition until closing at Seller’s Expense.

Scenario: Buyer does final walk through three days before closing and then on the day before closing, you get a call from the listing agent that says the hot water heater has quit working. This sentence means the Seller is responsible for fixing (Seller’s expense) the hot water heater before closing.

Lines 267-273
Your compensation and involvement in this contract is as a third party beneficiary. This verbiage was added to protect your commissions.

Lines 281-285
Please note that the disclosure of receiving a fee for the referral of a Home Protection Plan company has been removed.
Please contact TAR Legal Hotline at 800-899-5297 for White Paper concerning this RESPA issue.

Lines 327-329
A Severability clause added.

NOTE: For a line by line documentation of changes, please see the first article of this Digest.


3. Changes to the inFORM tool
Starting in 2009, the inFORM tool now has one additional highlight color. If you use the inFORM tool in the members area of the TAR web site, you know that you can click on different color highlights that help explain a particular form.

There are now 5  highlight colors – the 5th being the NEWEST addition to the inFORM tool. Listed below are the colors and their meanings:

1) YELLOW – Other TAR form(s) that you can use or should use in relation to the section of the current form you are viewing.

2) RED – Extra information that is helpful in relation to the section of the current form you are viewing

3) BLUE – An explanation of the content you are viewing

4) GREEN – An explanation and guide as to what you should be entering into a particular field you are viewing

5) AQUA – History and Version Changes on a page by page basis but in brief bullet format.

TAR staff is working hard to update this application for your use. In the meantime, there are several 2009 forms already posted in the inFORM tool along with the 2008 forms that were there last year. The 2008 list  of forms will remain online for a limited time and will eventually be deleted from the inFORM tool. Keep in mind that the inFORM tool is a “work in progress” at this time and you will see many additions in the next few weeks.


4. There are ONLY 2 Residential Listing Agreements in 2009 ?
Last year there were 4 Residential Listing Agreements for your use. This has been changed to only 2:

1)  F87 – Exclusive Right to Sell Listing Agreement (Designated Agency)
2) F88 – Exclusive Right to Sell Listing Agreement (Seller Agency)

The other two that were deleted were Exclusive Agency Agreements  [Seller Reserves the Right to Sell].

If you still need these type of listing agreements you can use either F87 or F88, depending on your office agency policy, and then input Special Stipulations language provided in form “F33 – Special Stipulations” to provide for the Seller reserving the right to sell the property himself.


5. TransactionDesk – How come I can’t create a 2008 form?

When using TransactionDesk, you can only ORIGINATE forms in the current year (2009). However, you can access saved 2008 forms that you were already working. This allows users to work with transactions that carried over from 2008 to 2009. It also prevents users from working with OLD forms that have been updated and provided for your protection.

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