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ASSIGNMENT: Q: Are commercial leases assignable? A: Yes, but How the fuck would we know, we’re a residential brokerage, not commercial! https://www.asreb.com/2020/11/the-assignability-of-contracts/ ASSIGNMENT: NOT ALLOWED: LANGUAGE: Buyer and Seller Acknowledge and Agree that this purchase contract may not be assigned without the express written authorization of the Seller. ASSIGNMENT: PROTECT AGENTS COMMISSION IF CONTRACT IS GOING TO BE ASSIGNED: MAKE SURE YOU HAVE A BUYER BROKER EMPLOYMENT AGREEMENT IN PLACE IF YOUR INVESTOR IS GOING TO ASSIGN THE CONTRACT! ASSIGNMENT LANGUAGE: To be clear, we can't write the assignment language itself, but this verbiage should be included in the final product: “Seller and Buyer acknowledge and agree that the purchase contract dated xx/xx/xxxx is being assigned to YYY, and by signing below YYY acknowledges that she/he has read, approves and signed the purchase contract, addenda, and all related documents including the Buyer Broker Employment Agreement and agrees to be bound by same as if she/he were an original signer on each and every document.” ASSIGNING CONTRACTS, Legality in Arizona http://www.creonline.com/forums/archive/index.php/t-125850.html ASSIGNMENTS (how they work) http://www.houseflippingonline.com/contract-assignments.html ASSIGNMENT (sample) https://www.asreb.com/2014/06/assignments-buyers-rights-purchase-agreements/ ASSIGNMENT LANGUAGE WHEN SELLING FOR A PROFIT: (MUST DISCLOSE WHEN SELLING FOR A PROFIT) “Seller and Buyer Acknowledge and Agree” OR Seller acknowledges that ____ is entering into this purchase contract for the sole purpose of obtaining legal interest in order to further market the property for sale. Buyer shall have the right to cancel this purchase contract at any time without cause and without recourse above and beyond any Earnest Money provided for on line #x.” “Buyer(Agent) intends to acquire legal, equitable title in order to Sell at a Profit.” Or “Seller agrees to allow xyz LLC to advertise the property and enter into a resale agreement during the escrow period. Seller acknowledges that a member of xyz LLC is licensed in the state of Arizona. Buyer waives SPDS and CLUE Report. Buyer agrees to pay all Seller’s escrow closing costs except any cost incurred to provide marketable title. Seller shall be responsible tor all unpaid taxes, utilities, liens, judgements or fines attached to the property. Close of Escrow shall be on the date stated on line #x, or earlier with written mutual agreement between the parties. Seller agrees to release Earnest Money back to the Buyer at any time that the contract is cancelled within the inspection period or if the Title Report reflects undisclosed clouds on title that inhibit the transfer of good title.”
ASSIGNMENT: Q: Hi - I have a ratified contract for my buyer Tom to buy a property. Tom now wants to assign the contract to his brother Dan. Tom will now be lending Dan 100% of the purchase price to buy the property. Who signs the contract amendment? Dan, Tom or both? A: Patrick, assignor and assignee typically sign an "assignment" agreement with the terms of the assignment. That could be for a fee, or just an assignment statement whereby the contract is being assigned from one party to another. Some title companies will prepare the assignment documents, you would have to ask the title co you are working with if they would prepare those. That could also include the seller signature acknowledging the assignment. Q: I am in urgent need of the verbiage you want to see for an assignment. Who signs? A: Hey, Rob. I'm sorry but we don't do a lot of assignments at HS. Most of our agents who do that type of business have previous experience. You might want to ask the Escrow Officer for assistance. They probably see more of them that we do. Meanwhile, you said it just went under contract yesterday - do we have a Sale file in RSA yet? When is it supposed to close? I will take a look at it in the morning. Thanks! TS.
ASSIGNMENT OF HOMESMARTS RIGHTS: Q: I had a client who had a BBEEA signed with me on 10/28/18 and wasn't set to expire until 7/31 of this year. He has since purchased a home with another agent/broker and I would like to enforce this agreement to collect the commissions owed. I spoke to one of the associate brokers, I believe it may have been Jeff, about this a few weeks ago when I was first made aware of this buyers purchase. I was informed that I needed to request a release of claim from you/ HS if I want to take this to small claims court. Please let me know what I need to provide to you for you to provide this release so that I can try to collect the commissions owed. Thanks. A: Do you recall speaking with this agent? Kyle sent me the attached form that evidently we've used in the past. I do not recall having this conversation with Ulises, but assigning our rights to him is the process that allows him to pursue/enforce the terms of the buyer broker agreement. AS-IS ADDENDUM: The lines in the AS IS Addendum don’t even match up with the Purchase Contract anymore FOCKER! AS-IS: If a buyer writes “AS-IS” in their offer, they can still go through the BINSR process, and cancel or ask for repairs after the inspection. However, if buyer writes “No repairs will be requested” or “Waives Inspection”, then they should not be able to “cancel” on the BINSR! Saying “AS-IS” does not mean anything unless there some teeth in it! AS-IS-Remember, the contract is already "AS-IS", the buyer can go through the inspection period and request repairs on the BINSR but the seller is not obligated to make any repairs. AS-IS: Saying “Seller will make no repairs” not the same as buyer saying “they will not ask for repairs.” (or, “Repairs will not be requested). Buyer can still go through BINSR process and even request repairs and possibly cancel. BUT, if buyer says will not ask for repairs, then you could hold them to that. ATTACH SALE FILE: Agent can attach sale file to listing file even if the listing file is still pending approval….per AG. AUCTIONS: Q: Does my real estate license allow me to assist a buyer with a purchase at auction and negotiate a commission or referral? A: Yes you can. However chances are the auction will not allow you to be a party to the contract. You will need a separate employment agreement (Buyer Broker Employment Agreement) as the buyer will usually have to pay. On the buyer broker write in that if the buyer purchase a property at auction the buyer will pay a consultation fee of $X. Jenny. BACK UP OFFER: HOW PROCESS…? Here are a couple common situations. Agents often call and ask; “My buyer wants to put in a backup offer on this Sale, how do I designate an offer as a back-up?” Good question with an easy answer, use the “Additional Clause Addendum.” Q: Create Sale File…? What about timeline in the contract and COE if notice comes two weeks from now, it is unlikely buyer could close by the original date. I assume that both parties would have to agree to an addendum extending the COE date, but if seller refuses, what recourse does buyer have other than cancelling during inspection period? A: Hi Peter, good questions. First, you will not create a file in RSA until and/or unless the backup offer moves into the first position. Second, you should consider adding language to the back up offer to address the timeline as you described, for example: BACK-UP OFFER, ADJUST COE DATE: WATCH YOUR DATES! “COE DATE ON PURCHASE CONTRACT WILL BE ADJUSTED TO 30 DAYS PAST THE NOTIFICATION DATE THAT FIRST CONTRACT HAS CANCELLED AND BUYERS ARE NOW IN THE FIRST POSITION.” Otherwise, the buyer might be forced to immediately cancel on the BINSR, and seller could issue a cure notice if buyer failed to open escrow and deposit EM. Take care, Jeff. BACK UP OFFERS: Multiple accepted backup offers are rare, according to Realtor.com. In these cases, the order in which the seller signs the backups determines priority, (FIRST IN TIME, FIRST IN LINE). and submitting an offer subsequent to other backups can lower your chances of getting the house. A seller may not accept a backup offer until the former offer is formally cancelled. A seller may gather backup offers for future consideration, or the seller may accept a backup offer contingent upon the cancellation of the current contract. With an accepted backup offer, the current buyer is your only competition, but if the seller stockpiles backup offers without formally accepting them, you may have to battle it out with the other backups anyway. https://homeguides.sfgate.com/backup-offer-mean-94016.html?fbclid=IwAR2y4vWkvaaiJAgZmG5v7DY2yGHRm06IASWrwLRT1FcpK0mZe1oQrSInFSs
https://www.realtor.com/advice/sell/can-a-home-seller-under-contract-still-accept-a-higher-offer/ **** Backups would be considered in order when received, ie, first in time, first in line. Remember, back up offers are legally binding and enforceable, in order received, so for example the seller can't just go to #3 because it's the highest, #2 would move into first position.
BACK UP OFFER: Q: In the event he find a different home he wants to submit an offer on, at what point do we cancel the current back-up offer? A: Hi X, You should cancel the backup offer prior to making an offer on a new property. The reason for this is we don't want to take any chances and have the buyer under contract for two properties at the same time...it’s all about risk reduction for both you and HomeSmart. For example, acceptance of the new offer and simultaneous notice from the back up that you are now in the first position would put the buyer under two contracts for two properties at the same time which could create legal and financial liability for the buyer. Not to mention the buyer is legally required to disclose a “home sale” contingency. (You could try subject to cancellation of prior contract). BACK UP OFFER: Paperwork? Treat the back up offer the same as a regular offer, but the SA should include the "Additional Clause" Addendum and check the box that says back up offer. They should also mark the box on line #36 of the pc that says the additional clause addendum is attached to this contract. You can also counter offer with a backup offer, the parties still need to reach an agreement on the other terms and conditions of the pc. BACK UP OFFER, ALWAYS WITHDRAW your backup offer before submitting another offer. If you represent the buyer, our policy is that you do not also represent a prospective “back-up” offer. Refer it out! BACK UP OFFR: DO I HAVE TO DISCLOSE THAT WE HAVE ACCEPTED A BACK UP OFFER? Q: I represent seller. We are UCB and during Inspection period. I have a signed notification from seller that property is ok to show. It is shown and buyer who is also an agent states he will be sending a back up offer using the additional clause addendum so all covered there. Should we reach agreement of back up offer am I required to notify the first buyers agent that we have a backup offer. I don’t think it’s a requirement. I’m asking bc first offer is subject to appraisal and if appraisal is lower my sellers aren’t coming down on price. Do I have to disclose the back up offer the first position offer? A: No, it is not a requirement to disclose that you have a back up offer. That being said, if you are able to leverage that disclosure to your clients advantage in some way, then you would want to disclose. The final decision is up to your client. JT BACK UP OFFER, ONE STRATEGY COULD BE TO SUBMIT OFFERS USING THE “MULTIPLE OFFER FORM”, BUYER WILL BE ABLE TO COUNTER SIGN THE OFFER TO RATIFY BACK-UP OFFER, ADJUST COE DATE: WATCH YOUR DATES! LANGUAGE: “COE DATE ON PURCHASE CONTRACT WIIL BE ADJUSTED TO 30 DAYS PAST THE NOTIFICATION DATE THAT FIRST CONTRACT HAS CANCELLED AND BUYERS ARE NOW IN THE FIRST POSITION.” BACK-UP OFFER NOW IN FIRST POSITION (SELLERS WRITTEN NOTICE) LANGUAGE: Q: I have an offer in backup position and was told we are moving into first position. What paperwork is required to make us the primary buyer and not in backup anymore? Thank you! A: Hi X, the BACK-UP Clause Language says "The date of sellers written notice to buyer shall be deemed the date of contract acceptance for purposes of all applicable Contract time periods." The "Sellers Written Notice" is the documentation and notice that you are now in the first position. Make a copy of that and upload into your transaction file along with the other required documents. Language as follows: “Consider this to be your notice from the seller that the prior contract for 123 Main Street has been cancelled and your back-up contract is now in the first position. Please open escrow immediately and have us copied on the escrow receipt"....OR….“Seller & Buyer acknowledge and agree that back-up offer has been notified that prior offer has cancelled and back-up offer is now in the first position.” Please open escrow immediately and have us copied on the escrow receipt.” OR WRITTEN NOTICE TO BACK UP BUYER OF FIRST POSITION CANCELLATION: USE NOTICE FORM: Seller hereby delivers notice to back up buyer (Jones) that first position buyer has given notice of cancellation. Therefore your back up offer dated xx/xx/xxxx is now considered to be in first position and shall close escrow as per the terms and conditions outlined in the purchase agreement. All time periods in the back up offer shall begin as of today's date as outlined in the additional clause addendum unless amended with written, mutual agreement between the parties. NOTE: This Contract is contingent on the receipt and delivery of the final escrow cancellation letter from title documenting said cancellation no later than 72 hours after date of this notification. BACKUP OFFER LANGUAGE FOR LATE PAPERWORK! (Use Late Paperwork Form with new file) The backup contract executed on xx/xx/xxxx was moved into first position after cancellation of previous contract/file and was uploaded accordingly into this new transaction file. BANKRUPTCY, LISTING, BANKRUPTCY OR FORECLOSURE: Q: I may be getting a listing but there are some special circumstances which, if I get some answers may be helpful for me...Is a homeowner required to make their payments while in a chapter 7 bankruptcy? If so, what happens if they do not? What is the process the lender does if they don't make their payments? Are there any special steps that must happen or can a lender just initiate a foreclosure? A: Bankruptcy courts typically control the assets being contested including the real estate, so that is a legal question the client should ask their bankruptcy attorney. A: If a homeowner stops making their mortgage payments, the lender can/will send a notice of default after 30 days at their discretion. Seller should contact their lender to see if anything can be worked out, otherwise, lender may initiate foreclosure proceedings typically after the delinquency reaches 90 days. Make sure the seller reaches out to the lender and their legal and/or tax adviser regarding any specific actions and timelines. (Can be up to 120 days, 30 days plus 90 days…) BASEMENTS: use as example 164-39-073-D https://mcassessor.maricopa.gov/mcs.php?q=16439073D scroll to bottom of page to building sketches. This is where sq ft is sourced from. If no basement shown then no basement included in sq ft. Questions an appraiser will ask: Is the basement Finished? Does it have a Separate entrance/exit? Is it Heated and/or Cooled? Not part of gross living area...can have value but up to appraiser...very subjective, usually noted as a bonus room, may be given little or minimal value by appraiser. “Could” be included in sq ft n MLS, source; OWNER, say total sq ft includes finished basement of X sq ft. (Buyer can do the math). BASEMENTS: NOTE; Fannie Mae spells out that if any of your basement is below grade, the government-sponsored enterprise will not count any of its square footage. If you plan on using any government-sponsored programs to finance your home, make sure to look into their requirements. When is a basement excluded from square footage? 1) Not finished, 2) Not heated, 3) Completely or often even partially underground When is a basement included in square footage? 1) Legal ingress or egress (This is partially a safety issue. This could be a door or window — but it usually means that your basement is a walk-out basement or garden-level lot basement), 2) Above-ground basement (Basements 100% below the ground usually cannot be included in the GLA no matter how nicely they are finished. This rule varies according to region), 3) When the basement is finished (For a basement to count, the area must be finished to the same quality and standards as the rest of the house. This means that the walls, flooring, lighting, and other features can’t be noticeably different from the main living areas), 4) When the basement is conditioned (The basement needs to be heated like the rest of the house, too. Space heaters, which are also a fire hazard, don’t count. Again, this requirement relates to livability and safety). Should you include the finished basement in your offer? Even if a basement doesn’t add to your square footage, it could still have value to you and other homebuyers. A large, open space could work perfectly as a playroom, keeping the kid’s toys out of the main house. The spare basement room might fit your exercise equipment or make a nice home office. A finished basement that supports the lifestyle you see yourself living in that house does matter. https://www.homelight.com/blog/buyer-are-basements-included-in-square-footage/
BATHROOM: Q: How can we stop agents from using the bathroom at my listings? A: My recommendation would be to put a paper tape on the toilets and say do not use - water is turned off. (Just as if the house was winterized) A note in the home should help. And just a little aside, why is the water turned off? And sometimes it is not good to have no water going through the pipes as gases can come up. BILL OF SALE: Q: How do i go about creating a separate bill of sale for a purchase contract where the unit is being sold fully furnished? A: You can google bill of sale, it is basically a very simple form listing the items that will be conveyed separate from the real estate purchase contract. "A bill of sale, also referred to as a “purchase and sale”, is a document that establishes the details of a transaction between two (2) parties, Buyer, and Seller. The form is usually very simple stating the financial terms of the agreement followed by the signature of the seller and buyer." Think of it as an inventory list. The items can convey at no value or at a cost agreed to between the parties. Here is language I use in the pc for furniture: “All furniture included as seen on xx/xx/xxxx. Furniture to convey on separate bill of sale AS-IS with no warranties at no monetary value. Bill of sale to be agreed upon and finalized during the inspection period.” (See bill of sale in docs tab for sample) BINSR: AMEND THE BINSR; Q: I need to make a revision on the BINSR. One of the items that was agreed upon in writing is now not to be completed. All parties have agreed to it. How do I put this change in writing? A: Attached please find the form titled "Amendment to the BINSR." You can use this to add or subtract from what was already agreed to in the original BINSR...pretty straightforward. Please let me know if you have any questions. Jeff. BINSR, AMEND THE BINSR, CHANGE RESPONSE: AMENDMENT OR SUPPLAMENT to the BINSR: (Also see BINSR Amendment Form in docs tab). Use to clarify any ambiguities or what seller will or will not do. Seller agrees to the following additional repairs: xxx xxxx xxxx OR “Seller and Buyer hereby agree to the following changes to the BINSR: xxx xxx xxx xxx xxx OR “Seller and Buyer Agree to amend/change the BINSR as follows: xxx xxx xxx xxx OR "Contrary to the prior BINSR agreement dated xx/xx/xxxx, Seller and Buyer agree to the following BINSR changes: seller_______ buyer_________ BINSR, AMEND THE BINSR: The contract says the buyer shall deliver notice of disapproved items in a "single notice" (see line #263 of the pc). This means you can only submit the BINSR one time. We call that "One Bite at the Apple." The proper way would be to "Amend" the BINSR with the form I have attached for you here. This form is titled the "Amendment to the BINSR." You would simply note any changes to the BINSR that the seller and buyer are in agreement with and have them sign off along with the BINSR. You can add additional repairs (as you are doing) or you could even remove a repair item that was originally agreed to.It's a pretty simple form to use, please call w/Q’s.
BINSR: CANCEL, ALSO SEE CANCELLATION 5 DAYS TO DISAPPROVE BINSR: CANCEL, CAN CANCEL ON BINSR DUE TO LOAN COST INCREASE…? ALSO SEE CANCEL, LOAN COSTS: Q: I have a buyer client who planned on using a hard money lender to purchase a property. The property is under contract as of 12/18/19. After escrow was opened he got word from the lender that it was going to cost him more than he was originally quoted. No inspections were completed yet. Can I use the reason that "the loan terms are not acceptable to the buyer" as a reason for cancellation on the BINSR? A: Dianna, I talked with Kyle to see his take on using the loan issue on the BINSR, we both feel that could open up the buyer to an argument from the seller that the buyer was not acting diligently and in good faith to get qualified or in fact was not qualified to purchase the home. A better approach would be to use something unacceptable or negative about the home, something specific to the home or neighborhood as reason(s) to cancel on the BINSR. Here are some ideas which we share with agents from time to time. The sex offender reason is also indisputable. (copy from BINSR cancellation and sex offender verbiage) Or, you could cancel on the unfulfilled loan contingency notice, also see cancel, loan costs). BINSR: CANCEL, DISAPPROVE OF CC&R’s: Q: Can my buyer disapprove of the CC&R’s on the BINSR? Can we write on the BINSR “Buyer Disapproves of Anthem CC&R’s…? A: Yes. The new AAR Notice form may be more appropriate, but the BINSR can be used for this too as long as the Buyer is still in their inspection period. It would be better if it said per Sec 3c of the Purchase Contract, but yes, the Buyer has 5 days to disapprove of the CCR's or other HOA Disclosures (fee’s, assessments, restrictions, legal issues, etc). BINSR CANCEL: CHANGE IN HEALTH: Due to a recent change with a family members health care needs, and the increased travel distance between the physical location of the home and the health care provider, buyer hereby elects to cancel the purchase contract and requests that EM be immediately refunded to the buyer.” BINSR, CANCEL, DEATH, CANCEL DUE TO DEATH AT PROPERTY: Buyer has (discovered, learned, been made aware) that a death has occurred in the property (or the owner died in the premises). Buyer is (spiritually) uncomfortable with this fact and hereby elects to cancel the purchase contract. BINSR, CANCEL, EMAIL CANCELLATION ALLOWED? Yes. See Legal Hotline Articles. Email must be formatted correctly and list reasons for cancellation. This is curable if cancellation does not list valid reasons for the cancellation as it would normally show on the BINSR. NOT preferred, but is allowed if structured properly. LANGUAGE FROM TITLE: Upon review of the documents presented, the determination has been made that the buyers exercised their right t cancel within the terms of the contract following sellers response of the BINSR, therefore the EM funds shall be refunded to the Buyer.
BINSR, CANCEL, ESCROW NOT OPENED, EM NOT DEPOSITED: 1) Cancel on BINSR, Check Rejected Box, List Reasons, Sign. 2) Create HS File. 3) Upload Contract, Upload BINSR Marked Cancelled, Upload Missing PW Form, EXPLAIN: “Buyer cancelled on BINSR after only (x) days, Escrow not opened, Earnest Money was not deposited.” Or is Mutual Cancellation Possible? (I would mark premises rejected on page 1 of the BINSR, Sign and I would reference some items from the inspection that came up (anything), and then expand on that. BINSR, CANCEL, FAKE CANCEL CONTRACT AFTER ONLY 1 DAY (buyer rec'd mold and asbestos remediation disclosures from seller)Cancel on BINSR, be very specific, property is unacceptable to buyers, road noise, dogs barking, neighborhood noise, pool/no pool, single level/two story, garage, room sizes too small for family furniture, kitchen too small, bedrooms too small, street setback, yard size, school district, deferred maintenance, prefer new build/age of home, taxes too high, Negative Feng Shui, Sanctuary City Consideration = increased crime statistics, rude neighbors, saw scorpion on property (especially if stated on SPDS), remodeling costs exceed buyers original budget estimates, code violations, unable to confirm square footage, prefer mountain views, prefer gated/ungated community, proximity to work, healthcare, outside of preferred school district, stairs vs no stairs, fence vs no fence, prefer yard/greenery or natural desert landscaping, prefer gas utilities, HOA/Deed restrictions, insulation ratings, lack of storage, etc, sign form, send cancellation to title co, copy listing agent. Termites: See Termite/Pest Infestation. BINSR, CANCEL SEX OFFENDER REGISTER SEARCH, AZ DEPT OF PUBLIC SAFETY “Buyer(s) elect to cancel after having conducted independent inquiries regarding sex offenders in the vicinity. Buyer election is based on search results which show (#) offenders located within the targeted search area using the “property address” as the “search address: See AZ DEPT OF PUBLIC SAFETY website: http://icrimewatch.net/index.php?AgencyID=55662 BINSR: CONCESSIONS: CLOSING COSTS, SELLER TO BUYER CREDIT LANGUAGE + overrides language in contract that limits WHAT items can be credited). “Seller agrees to credit buyer $x at COE which may be applied to any and all borrower closing costs including loan costs, title fees, escrow fees, pre-paids, appraisal, HOA fees, capital improvement fees, home warranty or any other closing cost approved by lender at buyers sole discretion.” However should the total buyer closing costs be less than the agreed amount of $4,500 both parties agree to a principle price reduction by the amount of the remaining balance.” OR If the previously stated costs are less than the seller $x credit, any additional remaining funds to be deducted from the purchase price.” OR “Seller agrees to contribute a total of $x towards buyer closing costs which include but are not limited to pre-paids, appraisal fees, loan costs, title and escrow fees, home warranty and any other closing cost approved by lender at buyers sole discretion OR .”Lenders have approved this language as it doesn't throw up red flags for the underwriters! “Contrary to line #100 or 101 (concessions) of the pc dated xx/xx/xxxx, seller to contribute $x towards buyers closing costs.” BINSR, CONCESSIONS, ADDITONAL CONCESSIONS: “Seller agrees to credit buyer an additional $2500 which will bring seller concessions to a total up to $4500, which may be applied to any and all buyer closing costs including loan costs, title fees, escrow fees, pre-paids, appraisal, HOA fees, Home Warranty, or any other closing costs approved by the lender at buyers sole discretion. However should the total buyer closing costs be less than the agreed amount of $4,500 both parties agree to a principle price reduction by the amount of the remaining balance.”
BINSR, COSMETIC ITEMS: (See Q and A in aaronline Inspection Period Article): Q: Is the buyer entitled to disapprove of cosmetic items? A: Yes. The buyer may disapprove of items in the buyer’s sole discretion (Section 6j). Of course, both parties are always obligated to act in good faith and the buyer’s disapproval rights are no exception to that rule. Tip: If the buyer elects to cancel the Contract, list all the items of which the buyer disapproves in the Inspection Period Notice.
BINSR, CREDIT IN LIEU OF REPAIRS, SELF INSPECTION: Q: Received a BINSR from the buyer and it is based on their own inspection, not a licensed inspector going in and doing the inspection and providing us the inspection report with specifics. How should we proceed? A: The buyer however, is allowed to "self inspect" if they choose to do so. My recommendation would be to clarify in your response exactly what you will or will not complete with as much detail as possible. The BINSR can only be submitted one time, but you are allowed to "amend" if the parties agree to that. What does your seller want to do? Q: My seller is thinking to actually not do any of this as it's so ambiguous and don’t want it to he a waste of time as they can still come back saying not satisfied. He is thinking to reduce the price from $261k to $255k or something.....once BINSR is submitted can we respond to BINSR saying not fixing anything but reducing the price by $6k? Is that an option to amend the contract at this point? A: Yes, the seller response could be "In lieu of Reparis, Seller agrees to reduce the sales price to $X", or something like that. If that is agreeable, you would follow that up with an addendum to actually change the price. BINSR: CREDIT IN LIEU OF REPAIRS: RISK REDUCTION: List Repairs, state in email: In Lieu of Repairs, Buyers preference would be a closing cost credit of $X/a price reduction to Y.”
BINSR, CREDIT IN LIEU OF REPAIR REQUEST LANGUAGE Repair xxxxx Repair xxxxx Buyer is willing to consider and prefers a closing cost credit or price reduction in lieu of any and all repairs. Any agreed upon credits will be acknowledged on a separate addendum as a change in terms of this purchase agreement. OR Buyers would prefer/consider/accept a closing cost credit or price adjustment in lieu of sellers making (any/all or the following) repairs…OR “As an alternative, Buyer will consider a closing cost credit of $X, or a purchase price reduction to $XXX in lieu of repairs.”
BINSR, CREDIT IN LIEU OF REPAIRS, ADDITIONAL CREDIT TO BUYER: “Seller agrees to credit the buyer an additional $X at COE, bringing the total seller to buyer credit/concession to $Y.” BINSR, CREDIT IN LIEU OF REPAIRS LANGUAGE “In lieu of making any repairs, both disapproved items and non-working warranted items, seller shall credit buyer $x towards closing costs at COE. This is the same credit that will be reference in Addendum #1.”
BINSR, CREDIT IN LIEU OF ALL REPAIRS LANGUAGE Sellers agree to make the following repairs: xxxxx. In lieu of all other requested repairs, seller agrees to credit the buyer $x at COE. BINSR, CREDIT IN LIEU OF REPAIRS, EXCESS CONCESSION FUNDS BACK TO SELLER: “Seller agrees to credit Buyer $x towards buyrs loan costs, impounds, Title/Escrow Company costs, Recording Fee’s, Prepaids and Appraisal costs, and if applicable, VA Loan Costs not permitted to be paid by the Buyer.” Any excess concession funds shall stay with and/or be credited back to seller.” BINSR, CREDIT, SELLER AGREES TO CREDIT IN LIEU OF REPAIR: Buyer and seller agree that in lieu of seller purchasing/installing 2” wood mini blinds at an amount not to exceed $X, seller will instead issue a credit of $X towards buyers closing costs and/or prepaids. BINSR--“CREDIT IN LIEU OF REPAIRS”, YOU MUST LIST REPAIRS, THEN SAY: “As an alternative, Buyer is willing to consider, and prefers, a closing cost credit or a price reduction in lieu of any or all repairs.” BINSR, DEADLINE, BUYER MISSED BINSR DEADLINE OR LATE, USE NOTICE/DISCLOSURE FORM: “Buyer missed BINSR submission deadline. Even though the Seller is not obligated to make any repairs, Seller will complete the following repairs on behalf of the buyer: List, xxxx, xxxx, xxxx.” (Or, say no repairs are required). Q: Hi Jeff, The buyer's agent submitted the BINSR late. They requested 2 repairs. A roof repair and a AC. My seller agreed to the roof repair but not the new AC (on an addendum as you suggested). How long do we give them before they let us know if they want to move forward or cancel the contract? A: Hi Jill, it would be up to your seller. At this point, line #287-289 would apply, your seller is under no further obligation regarding the BINSR. If they do submit one late, and your seller reply's, then the BINSR is back in play. You could consider language such as this if your seller is willing to make any repairs, but I recommend keeping it off of the BINSR, you can create your own Amendment or Supplement: BINSR, DEADLINE, BUYER MISSED BINSR DEADLINE, USE NOTICE/DISCLOSURE FORM: “Buyer missed BINSR submission deadline. Even though the Seller is not obligated to make any repairs, Seller will complete the following repairs on behalf of the buyer: List, xxxx, xxxx, xxxx.” BINSR, DEADLINE, BUYER MISSED DEADLINE, BINSR NOT SIGNED, USE MISSING PAPERWORK FORM: “My seller did not receive the BINSR from the Buyer within the 10 day period, so my Seller elected to not accept the late BINSR, that is why it is not fully executed.” BINSR: DEFINITION (OLD): What is a BINSR? It means Buyer Inspection/Seller Response. If the Buyer sees repairs on the Inspection Report that affect warranted items (electrical, plumbing, working of doors/windows, appliances, lights, furnace/AC) those would be written in (for example, a leaking faucet). The purpose is not to put the home in like-new condition but rather to be sure things function properly (furnace/AC). Here is a poem one Broker wrote explaining WARRENTED ITEMS: If it flushes or flows-Switches or glows-Has moving parts-or Should open or close-It has to be working-make sure everyone knows. BINSR….EARLY ACCESS, BUYER ALLOWED ACCESS TO MAKE REPAIRS (Also see drilling case study example in “wells” section of this document). “Seller allows buyer access to the property for the purpose of (list repairs) painting the areas which were of concern to the appraiser/lender. Buyer agrees to indemnify and hold harmless both seller and brokers against any and all liability regarding this early access to the property prior to COE.” Both parties acknowledge & agree that should this transaction fail to close for any reason whatsoever, excluding sellers breach, buyer will not be reimbursed for any costs incurred to make repairs. Buyer agrees to provide paid receipts to seller immediately once work is completed. Both parties acknowledge they have been advised to seek legal, tax and/or any additional professional advice desired. (OPTIONAL: SELLER WILL CREDIT BUYER $X TOWARDS REPAIRS AT COE…).
BINSR...EARLY ACCESS TO MAKE REPAIRS: 9/15/2020): Q: I have a listing that is in need of many repairs. The buyer's agent sent me the attached document to have the seller sign. How do you feel about this? They are wanting to start doing repairs on the house before the appraiser arrives so the transaction can go through. Thoughts? A: Hi X, Generally not a good idea due to liability issues, mechanics liens, what if the deal doesn't close, etc etc. If the repair is minor in nature, ie, touch up peeling paint, repair a leaky hose bib, that's one thing, major repairs costing hundreds or thousands of dollars are another. However, at the end of the day if the parties are adamant that they want to go in this direction, you should also include indemnification language in your addendum such as: Seller and Buyer agree to defend, indemnify and hold harmless Real Estate Brokers and Agents of record against any and all claims that may be made regarding Seller(s) allowing Buyer(s) access to make repairs prior to COE . BUYER AND SELLER ARE HEREBY ADVISED TO SEEK LEGAL, TAX AND ANY OTHER PROFESSIONAL ADVICE DESIRED REGARDING THIS MATTER.”
BINSR, EXTEND INSPECTION PERIOD: “Seller and Buyer mutually agree to extend the "inspection" period through May 21, 2017 in order to complete all necessary inspections and complete the BINSR.” BINSR, HOA RESPONSIBLE FOR REPAIRS Buyer, request something like “Have HOA repair loose tiles and cracked caps.” Seller response: “Seller cannot perform repairs to the roof or trim the trees. This is the responsibility of the HOA as per the CC&R’s. An inspection report and repair request has been submitted to the HOA for their review. The HOA is responsible for performing any necessary repairs to the roof and trimming of trees. Repairs completed by the HOA may have to be completed for the buyer after the close of escrow.” BINSR, HOA RESPONSIBLE FOR REPAIRS: Q: The home inspector has found termite tubes at the master bedroom window at today’s inspection. The condo is on the second floor, and the inspector stated that the termite treatment cannot be done from the condo but from the ground, i.e. the building has to be treated. The condo is located in a subdivision, and the HOA fee covers the exterior maintenance of unit, roof, etc. It should be the HOA’s responsibility to treat for termites. We do not know when the building was treated the last time. Also, trees are hanging over the roofing of the building where subject unit is located. Per the home inspector, the HOA shall cut back the branches to avoid damage of the roof, due to tree sap, bird droppings, or from accumulated tree debris. It is my understanding that the HOA is responsible for the termite treatment and the cutting of the trees. What’s proper verbiage on the BINSR? A: Regarding these repair items which are out of the sellers control, I would state something like "Due to the fact that Pest Control Services and Landscaping are administered and controlled by the HOA, Seller agrees to contact the HOA Immediately to request and schedule both pest control/termite treatment for building x, unit x, and tree trimming for building x, unit x." "Seller to confirm, in writing, that these requests have been submitted to the HOA." Any and all HOA Response including Scheduling and Confirmation Status for these requested Repair services shall be immediately forwarded to the Buyers. If seller is found responsible for any repairs or damages, Seller agrees to assume all financial responsibility to either the HOA or Contractor.” "Due to the fact that Pest Control Services are administered by the HOA, Seller agrees to contact the HOA Immediately to request and schedule pest control/termite treatment for building x, unit x. "Seller to confirm, in writing, that these requests have been submitted to the HOA." Any and all HOA Response including Scheduling and Confirmation Status for requested Repair services shall be immediately forwarded to the Buyers. If seller is found responsible for any repairs or damages, Seller agrees to assume all financial responsibility to either the HOA or Contractor.” BINSR, HOA RESPONSIBLE FOR REPAIRS, SELLER BINSR RESPONSE: Seller agrees to complete all requested repairs within Seller's control, however, roof repairs are the responsibility of the HOA. Seller agrees to submit a written request-immediately-to the HOA for roof repair, items #33 & #34. A copy of the repair request and HOA acknowledgement will be provided but Seller cannot guarantee this repair can be completed prior to COE. |
