Form Changes

 
  • July 1, 2021 Standard Forms Changes

    June 7, 2021
    The NVAR Board of Directors has approved the following new forms and forms changes, as proposed by the NVAR Standard Forms Committee, effective July 1, 2021.

    K1387 - Landlord Notice Regarding Nonpayment of Rent - Lease
    This development necessitated certain administrative updates to this form. This completely updated form replaces the Request Due to Economic Hardship – Lease (former K1387), which was removed by the Board of Directors in January 2021. This form complies with recent revisions to the Virginia Residential Landlord and Tenant Act which require landlords to send certain notices to tenants prior to moving to obtain possession of the property for nonpayment of rent. This form may be used for all Landlords, regardless of the number of properties they own. This form contains all required notice provisions from Virginia Code § 55.1-1245. * Administrative Update September 2, 2021: Special legislative session instituted additional required notices. 

    K1388 – Payment Plan Addendum – Lease. This development necessitated certain administrative updates to this form. This completely updated form replaces the Notice Regarding Request Due to Economic Hardship (former K1388) which was  removed by the Board of Directors in January 2021. This form complies with recent revisions to the Virginia Residential Landlord and Tenant Act which require landlords owning more than 4 properties to offer tenants a repayment plan before moving to obtain possession of the property for nonpayment of rent. This form contains all required provisions from Virginia Code § 55.1-1245. * Administrative Update July 2, 2021: Virginia’s COVID-19 State of Emergency expired June 30, 2021.

    K1392 – Referral Agreement. This new form is designed to better serve members by providing a basic referral agreement for use between brokerages or when broker-provided forms are not otherwise available.

    K1354 – Lease VRLTA. This form has been updated consistent with recent revisions to the Virginia Residential Landlord and Tenant Act, extending from 5 days to 14 days the amount of time that landlords must wait after serving written notice on a tenant notifying the tenant of nonpayment of rent and the landlord’s intention to terminate the lease. Paragraph 25 has also been updated to comply with recent changes to Virginia law regarding Landlord reservation of rights. The Access paragraph has been updated to comply with changes to Virginia law regarding reasonable access during a state of emergency declared by the Governor.

    If you have any questions about these changes, please contact the Legal Hotline. 
  • January 1, 2021 Standard Forms Changes

    • Daniel B. Harris Esq.
    • Matthew L. Troiani Esq.
    December 7, 2020

    The NVAR Board of Directors has approved the following new forms and forms changes, as proposed by the NVAR Standard Forms Committee, effective January 1, 2021:

    K1391 – New Home Sales Addendum. This new form is designed to provide members greater flexibility when representing buyers and builders of new residential property.  This form may be used in conjunction with the Residential Sales Contract and related addenda and may be used at any stage of construction. This form will replace K1208 – New Home Construction Contract.

    K1373 – Options Addendum.  This form has been modified for usage in conjunction with the New Home Sales Addendum.

    K1281 – Exclusive Right to Lease.   This form has been modified to reflect recent updates to the MLS Rules and Regulations with respect to “Coming Soon” listings involving new construction/condo conversions/major renovations for which there is no occupancy and to ensure consistent terminology with other forms.

    K1336 – Exclusive Right to Sell Listing Agreement/ K1337 – Exclusive Agency Listing Agreement. These forms have been modified to provide greater clarity for sellers and protections for brokers with respect to seller-provided reports and information regarding the condition of the property. The forms have also been updated to reflect recent updates to the MLS Rules and Regulations with respect to “Coming Soon” listings involving new construction/condo conversions/major renovations for which there is no occupancy, and to ensure consistent terminology throughout the forms library.

    K1355 – Exclusive Right to Sell Unimproved Land. This form has been modified to reflect recent updates to the MLS Rules and Regulations with respect to “Coming Soon” listings involving new construction/condo conversions/major renovations for which there is no occupancy, and to ensure consistent terminology throughout the forms library.

    VA/FHA/USDA Appraisal Contingency Addenda.  These forms have been updated consistent with feedback from members since the July 1, 2020 updates to the Appraisal Contingencies.  These changes more closely align the forms to the federal guidelines while ensuring buyers using federally supported mortgage loan programs can submit offers that are received as favorably as offers including conventional financing and appraisal contingencies.

    K1349 – Appraisal Contingency Notice. This form has been updated consistent with the changes to the FHA/VA/USDA Appraisal Contingency Addenda.


    Administrative/Technical Updates:

    K1321 – Residential Sales Contract / K1354 – Lease (VRLTA). No substantive changes were made to these forms. Instead, the forms have been revised to ensure consistent formatting throughout the forms library and to make minor administrative changes. For example, in the Residential Sales Contract, a “New Home Sales Addendum” checkbox was added to Paragraph 39 (Additions) and in the Lease, Paragraph 8 was updated to change “Registered Agent” to “Resident Agent”. Extra initial blocks were added to the footers in both forms.

     

    The followings forms have been removed from the Forms Library:


    K1208 – New Home Construction Contract
    .  This form has been replaced with new form K1391 - New Home Sales Addendum, which covers more types of transactions and should be more effective than the narrow scope of the New Home Construction Contract.

     

    K1382 – Construction Financing Contingency.  This form is no longer necessary because the New Home Sales Addendum is an addendum to the Residential Sales Contract. Addenda which are typically used in conjunction with the Residential Sales Contract may likewise be used with the New Home Sales Addendum.

     

    The following forms have been temporarily removed from the Forms Library pending review to ensure compliance with recent changes to Virginia law and federal regulations relating to evictions and rental assistance:

    K1387 – Request Due to Economic Hardship - Lease

    K1388 – Notice Regarding Request Due to Economic Hardship

     

    If you have any questions about these changes, please contact the Legal Hotline.

  • July 1, 2020 Standard Forms Changes

    • NVAR
    June 19, 2020


    The NVAR Board of Directors has approved the following new forms and forms changes, as proposed by the NVAR Standard Forms Committee, effective July 1, 2020:

    K1389 – Extension Of Review Period For Condominium Resale Certificate/ Property Owners’ Association Disclosure Packet Addendum.  This is a new form consistent with revisions to the Virginia POA Act, Virginia Condominium Act and the Residential Sales Contracts.  This form allows parties to extend the 3 day right of cancellation under the POA Act and/or Condominium Act by up to an additional four (4) days. The form may be used at or after ratification and may be used multiple times, as needed.

    K1390 – Understanding Your Rights Under The Virginia Condominium Act/Property Owners’ Association Act.  This new form is an optional resource provided by brokers to buyers to inform the client of the statutory requirements for association resale disclosure packets and certificates. Inclusion of this form enables the education of parties while removing unnecessary language from the Sales Contracts. Relevant provisions from deleted forms K1025 – Purchaser’s Acknowledgment Of Receipt Of Condominium Disclosure; K1126 – Purchaser’s Acknowledgement of Receipt of Property Owners’ Association Disclosure Packet are incorporated into the new form.

    K1321 – Residential Sales Contract.  This form has been modified consistent with recent revisions to the Virginia Property Owners Association Act and Virginia Condominium Acts and to remove unnecessary provisions. The Residential Sales Contract is now only 13 pages. The form has also been modified to remove confusing language regarding buyer Default if they fail to settle on time as part of financing contingencies.  Additional formatting changes were made to improve clarity and consistency across the NVAR forms library. *Administrative update 08/2020 to clarify responsibility for Regional WMATA Capital Fee.

    K1209 – Sales Contract for Unimproved Land. This form has been modified consistent with revisions to the Residential Sales Contract.

    K1208 – New Home Construction Contract.  This form has been modified consistent with revisions to the Residential Sales Contract.

    K1354 – Lease VRLTAThis form has been modified consistent with revisions to the Virginia Residential Landlord Tenant Act. Provisions regarding late fees were revised to clarify that the 10% late fee for nonpayment of rent may not exceed the lesser of 10% of the total monthly Rent or 10% of the reaming balance owed under the Tenancy. An acknowledgment of receipt was added to address the new Department of Housing and Community Development form “Statement of Tenant Rights and Responsibilities”. Paragraph 2 (Lease Term) has also been revised to clarify the term of the tenancy and end-of-lease procedures. Paragraph 19 (Security Deposit) has been updated to clarify that he 45-day period for return of the itemized statement and Security Deposit begins at the later of Termination of the tenancy or Tenant’s vacating Premises. Other formatting changes were made to improve clarity and consistency across the NVAR forms library.

    K1281 – Exclusive Right to Lease.  This form has been modified consistent with recent changes to the Virginia Fair Housing Act, which add “source of funds” as a protected class.

    K1359 – Conventional Financing and Appraisal Contingency Addendum.  The Appraisal Contingency portion of this form has been modified consistent with revisions to the Home Inspection Contingency Addendum to establish a Negotiation Period and Buyer’s Election Period. This change will simplify the Appraisal Contingency and ensure consistent procedures across NVAR’s most frequently used forms. Language regarding Default and exercising the financing contingency has been removed for clarity and consistency with changes to the Residential Sales Contract.

    K1353 – Appraisal Contingency No Financing Addendum.  This form has been updated consistent with the changes to the Conventional Financing and Appraisal Contingency.

    K1349 – Appraisal Contingency Notice. This form has been updated consistent with the changes to the Conventional Financing and Appraisal Contingency, FHA/VA/USDA Financing Contingencies, and Appraisal Contingency No Financing Addenda.

    VA/FHA/USDA Appraisal Contingency Addenda.  These forms have been updated consistent with the changes to the Conventional Financing and Appraisal Contingency but taking into account the unique federal guidelines pertaining to federally supported mortgage loan programs.


    The followings forms have been removed from the Forms Library:

    K1346 – Understanding Virginia Residential Disclosure Act. The form is no longer necessary due to upcoming revisions to the Virginia Residential Disclosure Act. Effective July 1, 2020, buyers must sign an acknowledgment that they are aware of the buyer-beware disclosures in the Residential Property Disclosure Statement, removing the need for this form.

    K1299 – Request for Property Owners’ Association Disclosure Packet & K1024 – Request For Condominium Disclosure.  These forms are unnecessary, as most associations have their own procedures for requesting resale disclosure packets and the contents of such disclosures. 

    K1025 – Purchaser’s Acknowledgment Of Receipt Of Condominium Disclosure; K1126 – Purchaser’s Acknowledgement of Receipt of Property Owners’ Association Disclosure Packet. This form is no longer necessary due to recent statutory updates. Buyer’s 3 day right of cancellation begins upon delivery of the disclosure, regardless of whether Buyer acknowledges receipt. Relevant provisions have been incorporated into the new form K1390 – Understanding Your Rights Under the Virginia Condominium Act/Property Owners’ Association Act.

     

  • April 1, 2020 Standard Forms Changes

    March 20, 2020

    The NVAR Standard Forms Library has been updated to provide Realtors® with new tools and to correct certain outdated forms. The following changes were approved by the Board of Directors effective April 1, 2020:

    K1385 Optional Listing Information Sheet – This new form is designed to assist buyer’s agents when submitting offers.  It is prepared by the listing agent and contains a comprehensive collection of the information necessary to submit a clean offer. Listing agents can upload the form directly into MLS for easy access. This form eliminates the need for the buyer’s agent to contact the listing agent for basic information concerning the property, such as party names, conveyances, fixtures and utilities. For simplicity, its sections mirror those in the Residential Sales Contract. This is an optional form which may not be incorporated into any agreement. It also contains language notifying buyers that it is not a disclosure or representation by the seller.

    K1308 Buyer’s Acknowledgement of Potential Adverse Consequences – This form was last updated in 2005.  It provides brokers with written confirmation that their agents discussed the potentially adverse consequences associated with waiving certain contractual protections (home inspection, financing, etc.) with their buyer clients prior to submitting the offer. It has been modified to remove ambiguous provisions and to update formatting and terminology consistent with modern NVAR forms.

    K0004 Listing Agreement Amendment – This form has been substantially modified to comply with the current MLS statuses and the MLS Off-MLS & Office Exclusive Policies. There were concerns that the K0005 Listing Withdrawal form was being misused because of the change to the MLS definition of Withdrawn status. To address these concerns, relevant provisions of K0005 Listing Withdrawal have been incorporated into this form. By consolidating these two forms, brokers can now amend the listing agreement and/or update the MLS status with single document.

    The followings form has been removed from the Forms Library:

    K0005 Listing Withdrawal – This form is no longer necessary due to recent changes in MLS Rules and the relevant provisions having been incorporated into K0004 Listing Agreement Amendment.

    If you have any questions about these changes, please contact the Legal Hotline.

  • December 1, 2019 Form Changes

    November 18, 2019

    December 1, 2019 Standard Forms Changes

    By: Matthew L. Troiani, Esq.

    The NVAR Standard Forms Library was updated effective December 1, 2019 in order to comply with recent changes in MLS Rules. In order to avoid any confusion, the Forms Library will not be updated on January 1, 2020.

    1. K1321 Residential Sales Contract – This form has been modified consistent with revisions to the Virginia Code in the Property Owners Association and Condominium Acts. The Contract specifically allows for buyer delivery of the earnest money deposit by wire transfer. The form has also been modified to remove redundant definitions of Deliver and Possession Date in paragraph 31. The FIRPTA provisions have been substantially modified to more accurately define who is subject to FIRPTA and incorporate the parties’ responsibilities under the statute if FIRPTA does apply. These revisions remove the need for a separate FIRPTA Addendum.
    2. K1209 Sales Contract for Unimproved Land  This form has been substantially modified consistent with recent revisions to the Residential Sales Contract and to update Virginia Code references.
    3. K1336 Exclusive Right to Sell Listing Agreement, K1337 Exclusive Agency Listing Agreement, K1355 Exclusive Right to Sell Unimproved Land, K1281 Exclusive Right to Lease Listing Agreement – These brokerage agreements have been substantially modified to ensure compliance with the new MLS Policies. The “Coming Soon” policy has been incorporated into the brokerage agreement because the only relevant restriction on marketing is the limitations on showings. Leasing and land sales have been excluded from the new policy, but these forms have also been updated to ensure there is no longer any need for a separate Pre-Marketing Addendum. The FIRPTA provisions in these forms have also been updated consistent with the changes to the Residential Sales Contract. The Exclusive Right to Lease Listing Agreement has been updated to remove reference to “opting out” of the VRLTA, since there is no longer any “opt-out” possibility for residential leases.
    4. K1354 VRLTA Lease – This form has been modified to update Virginia Code references and remove any language regarding “opting out” of the VRLTA.

      The followings forms have been removed from the Forms Library:

    5. K1369 Pre-Marketing (“Coming Soon”) Addendum to Listing Agreement – This form is no longer necessary due to recent changes in MLS Rules and the relevant provisions have been incorporated into the Listing Agreements.
    6. FIRPTA Addendum – This form is no longer relevant as all relevant provisions have been incorporated into the Residential Sales Contract.

     

  • July 1, 2019 Form Changes

    June 7, 2019

    1. K1321 Residential Sales Contract 

    This form has been substantially modified in conjunction with revisions to the financing contingencies. The definition of Seller Subsidy can now be found in the Definitions Paragraph of the Contract and is removed from the financing contingencies. The Buyer Representations paragraph has been modified to remove authorization to the cooperating brokerage to provide buyer financial information since this is redundant with Paragraph 2. The most substantive change is to page 1, which has been modified for clarity. The necessary information to review the offer, including sales price, amount of loan and type of loan, remains on the first page of the contract, but Specified Financing, Alternative Financing, and Assumption terms are now contained in the relevant financing contingencies. The contract has been shortened by 1 page without significantly lengthening the financing contingencies!

    2. K1359 Conventional Financing and Appraisal Contingency Addendum, K1340 FHA Financing Contingency Addendum, K1339 VA Financing Contingency Addendum, and K1372 USDA Financing Contingency Addendum 

    These forms have been modified to more clearly define Specified Financing, how the contingency is satisfied/removed and the consequences for switching to Alternative Financing. The contingencies have also been modified to include 2 options for the Seller and Buyer to negotiate upfront, similar to the Home Inspection Contingency. The first option, called the Contingency with Automatic Extension, is essentially the current financing contingency. A second option, called the Contingency with Automatic Expiration, has been added for Sellers and Buyers to choose a contingency that automatically expires at the Financing Deadline. Reference to the Seller Subsidy has been removed since it is a defined term in the Contract. Assumption terms have been added to the FHA, VA and USDA Financing Contingencies.

    3. K1336 Exclusive Right to Sell Listing Agreement, K1337 Exclusive Agency Listing Agreement, K1355 Exclusive Right to Sell Unimproved Land, K1281 Exclusive Right to Lease Listing Agreement 

    These brokerage agreements have all been modified to explicitly state that the Listing Broker is not obligated to continue to market and show the Property after a contract/lease has been ratified unless otherwise instructed in writing by the client. This creates a default option once the parties have gone under contract. If a NVAR Seller/Landlord wishes to continue to the market the property post-ratification, they can instruct the Listing Broker in writing. The Exclusive Right to Lease Listing Agreement has also been modified to inform landlords that the NVAR Common Law Lease is no longer available. If landlords are eligible to opt-out of the VRLTA and wish to do so, they may seek professional advice on drafting a lease.

    4. K1369 Pre-Marketing Addendum to Listing Agreement 

    This form has been updated to remove references to MRIS and reorganizes the selection options to emphasize the discussion regarding listing the property in the MLS.

    5. K1282 Exclusive Right to Represent Tenant Agreement

    This form has been modified to include a warning to Tenant to not take videos or photos of other people’s property without authorization, similar to the warning in the Exclusive Right to Represent Buyer Agreement.

  • January 1, 2019 Form Changes

    December 17, 2018

    The NVAR Board of Directors has approved the following new forms and forms changes, as proposed by NVAR’s Standard Forms Committee. To view the Educational Version of the form, please click on the form title.

    1. K1343 – Inspection Contingency Removal Addendum

    This form was previously known as the Home Inspection Contingency Removal Addendum. Recognizing that there are many different inspection contingencies that may require the parties to negotiate removal terms, the revised form allows the parties to select which contingencies will be removed at any given time. The revised form is flexible for removing one or more contingencies simultaneously and can be used more than once per transaction depending on the inspection contingency deadlines.

    2. K1020 – Seller Post Settlement Occupancy Addendum

    This form was revised to present clearer choices for selecting and calculating the Occupancy Charge. It removes ambiguity for both the buyer and seller as to what the Occupancy Charge will be at closing.

    3. K1342 – Home Inspection and Radon Testing Contingency Addendum

    This form was revised to clarify that any offers or counteroffers that have not been accepted or ratified during the Negotiation Period for both contingencies will automatically expire at the end of the Negotiation Period. The term “Period” was added to the sub-heading “Buyer’s Election.”

    4. K1384 – Addendum – Lease

    This NEW form was created in order to allow the parties to execute an addendum to modify terms to a residential lease. This was based on the existing Addendum to Sales Contract, but the language was modified to reference Lease instead of Contract, Tenant instead of Buyer, Landlord instead of Seller, and Premises instead of Property.

    5. K1117 – Addendum – Sale

    This form was previously known as an Addendum to Sales Contract. The content remains the same, but the form name has been updated to distinguish it from the new Addendum – Lease form.

    6. K1321 – Residential Sales Contract

    This form was updated in three areas:

    a. Paragraph 2 – This section was modified to include the Seller Subsidy on the first page of the contract to make it easier for members and their clients to compare the net sales price between respective offers.

    b. Paragraphs 15 & 16 – The former Paragraphs 15 and 16, Financing Application and Alternative Financing, were moved to Paragraph 2G and 2H for clarity in organization.

    c. For Informational Purposes Only - These changes were administrative in nature. The Team Name and Team Business Entity License Number were included to comply with the Jan. 1, 2019 Virginia law changes.

    7. K1339 – VA Financing Contingency Addendum
    K1340 – FHA Financing Contingency Addendum

    K1359 – Conventional Financing and Appraisal Contingency Addendum

    K1372 – USDA Financing and Appraisal Contingency Addendum

    The Seller Subsidy is now a defined term on the first page of the Residential Sales Contract. Therefore, the various financing contingencies no longer need to provide a space to include the amount of the Seller Subsidy. To avoid any confusion or inconsistency, the financing contingencies have been modified to reference the Seller Subsidy as defined in the Residential Sales Contract and no longer provide a separate section for including the specific dollar amount.

     

    The following forms were updated to comply with changes to the law that took effect on Jan. 1, 2019. 

    1. K1281 – Exclusive Right to Lease Listing Agreement
    K1282 – Exclusive Right to Represent Tenant Agreement
    K1336 – Exclusive Right to Sell Listing Agreement
    K1337 – Exclusive Agency Listing Agreement
    K1338 – Exclusive Right to Represent Buyer Agreement
    K1355 – Exclusive Right to Sell Unimproved Land Listing Agreement

    Each form has been updated at the end to include the Team Name (if applicable) and Broker Contact Information.

    2. K1354 – VRLTA Lease

    The VRLTA Lease has been updated to include the Team Name and Team Business Entity License Number in the “For Information Purposes Only” section.

    3. Suggested Procedures Manual

    Section V of the Manual has been updated to reflect the new statutory definition of a “Team” and the requirement to register the Team with DPOR as a business entity.

    4. K1307 – Seller’s Estimated Cost of Settlement

    This form was updated to ensure that the formulas for calculating closing costs reflect current tax rates and the current range of charges in the industry.

    The following forms have been removed from the current forms library:

    1. Buyer Estimated Costs of Settlement

    This form is out of date and infrequently used. Changes in the law require that better estimates of closing costs be provided to buyers and borrowers by the lender and/or settlement agent.

    2. K1333 – Common Law Lease 

    As of Jan. 1, 2019, there will no longer be a substantive difference between the common law landlord/tenant provisions and the Virginia Residential Landlord Tenant Act (VRLTA). To avoid confusion or duplication of efforts, the Common Law Lease has been retired since the law now requires common law leases to be virtually identical to the VRLTA Lease.

  • Special Forms Update: September 15, 2018 Form Changes

    • Matthew L. Troiani
    August 30, 2018

    Effective September 15, 2018, the NVAR Board of Directors has approved the following forms changes, as proposed by NVAR’s Standard Forms Committee. To view the Educational Version of the form, please click on the form title.

    K1360 – Private Well and/or Septic Inspection Contingency Addendum:

    This form was revised to again permit the parties to designate either the Buyer or Seller as the responsible party for the Septic Inspection. The form was also revised to create additional protections for the Buyer in the event the Seller is responsible for the Septic Inspection but fails to perform the Septic Inspection or make timely delivery of the Septic Inspection Report. Some of the terminology was updated to coincide with regulatory standards. The revised form allows the parties to mutually identify the Septic Inspector during contract negotiations. Finally, the revisions clarify Seller’s responsibility to remove impediments to the Septic Inspection.

     

  • July 1, 2018 Form Changes

    • Matthew L. Troiani
    June 18, 2018

    The NVAR Board of Directors has approved the following new forms and forms changes, as proposed by NVAR’s Standard Forms Committee. To view the Educational Version of the form, please click on the form title.

    1. K1375 – ASSISTANCE ANIMAL ADDENDUM (NEW)

    This is a new form that was created to provide a lease addendum where the landlord has approved a request for an assistance animal in accordance with the Americans with Disabilities Act and the Fair Housing Act, and is not the same as the Pet Addendum. The Addendum permits a tenant to have an assistance animal in the dwelling, subject to certain tenant responsibilities for the animal.

    2. K1376 – ASSISTANCE ANIMAL APPROVAL NOTICE (NEW)

    This is a new form that was created to provide a formal notice by which a landlord can approve a tenant’s request for a reasonable accommodation for an assistance animal.

    3. K1377 – ASSISTANCE ANIMAL DENIAL NOTICE (NEW)

    This is a new form that was created to provide a formal notice by which a landlord can deny a tenant’s request for a reasonable accommodation for an assistance animal.

    4. K1378 – REQUEST FOR REASONABLE ACCOMMODATION/RULE OR POLICY (NEW)

    This new form was created to provide a formal request by a tenant or applicant for a reasonable accommodation to a rule or policy. This form will allow the landlord to review and either approve or deny the request. This form will work in conjunction with K1376 and K1377.

    5. K1379 – REASONABLE MODIFICATION ADDENDUM/ PHYSICAL STRUCTURES (NEW)

    This new form was created to provide a formal request for a tenant or applicant to make a modification to the physical structure of a dwelling in order to reasonably accommodate a disability. The form is to be provided by the landlord upon request, and incorporated into the lease as an addendum if the modification is approved.

    6. K1380 – VERIFICATION OF DISABILITY (NEW)

    This new form was created for a tenant or applicant to complete with the assistance of a verifier who has a therapeutic relationship with the tenant/applicant in situations where a disability is not readily apparent. Once completed, the form will be submitted along with the Request for Reasonable Accommodation/Rule or Policy.

    7. K1383 – NOTICE - LEASE (NEW)

    This new form was created to provide a blank form in which parties can provide notice under the VRLTA and Common Law Leases.

    8. K1273 – NOTICE - SALE

    This form was updated to distinguish it from the new Notice – Lease form and to update changes in terminology since 2015.

    9. K1017 – PROPERTY MANAGEMENT AGREEMENT

    This form was significantly updated to reflect changes in the law, required disclosures, and property management practice since 2001. The form was also reorganized for convenience of use.

    10. K1374 – PROPERTY MANAGEMENT INFORMATION FORM

    This form was updated to reflect changes in the law, the Property Management Agreement, and property management practice.

    11. K1333 – LEASE COMMON LAW

    This form was updated as follows:

    a) To create a new separate Paragraph 11 addressing smoking on the Premises, including electronic cigarettes.

    b) Paragraph 32 (formerly Paragraph 30) was updated to provide notice to the parties, not just to the tenant, that separate commission may be owed if the tenant purchases the property.

    c) The Assistance Animal Addendum was added as an option in Paragraph 39.

    d) Paragraph 44 was added to provide the statutorily-required notice that one or more parties may be real estate licensees.

    e) Brokerage Information was added to the end in the same manner as the Residential Sales Contract.

    12. K1354 – Lease VRLTA

    This form was updated as follows:

    a) To create a new separate Paragraph 12 addressing smoking on the Premises, including electronic cigarettes.

    b) Paragraph 33 (formerly Paragraph 30) was updated to provide notice to the parties, and not just to the tenant, that separate commission may be owed if the tenant decides to purchase the property.

    c) The Assistance Animal Addendum was added as an option in Paragraph 40.

    d) A new Paragraph 45 was added to provide the statutorily required notice that one or more parties may be real estate licensees.

    e) Brokerage Information was added to the end in the same manner as the Residential Sales Contract.

    13. K1321 – RESIDENTIAL SALES CONTRACT

    This form was updated in three areas:

    a) Paragraph 4 – The clause requiring that the Settlement occur on the prior business day in the event the Settlement Date falls on a Saturday, Sunday or legal holiday was moved from Paragraph 33(E) to Paragraph 4.

    b) Paragraph 13 – Clarifies that while wall mounted electronic components/devices do not convey with the property, related mounts, brackets and hardware do convey with the property unless the parties agree otherwise in writing. This is intended to clarify conveyance and to address disputes between parties regarding the removal of the mounts and the adequacy of repairs of the holes left behind when mounts are removed.

    c) Paragraph 20 – Adds a check box for situations where no Wood-Destroying Insect Inspection is required or requested by a lender or the parties.

    14. K1282 – EXCLUSIVE RIGHT TO REPRESENT TENANT

    These changes were administrative in nature to correct a typographical error in Paragraph 15.

  • January 1, 2018 Form Changes

    December 12, 2017

    The NVAR Board of Directors has approved the following forms changes, as proposed by NVAR’s Standard Forms Committee:

    1. K1338 – Exclusive Right to Represent Buyer Agreement

    a. Paragraph 4, Term and Termination: This paragraph was modified to clarify the Buyer’s responsibility for payment of the Termination Fee. This means that any Termination Fee paid by the Buyer to the Broker is in addition to any other fees paid by Buyer to Broker during the term of the Agreement.

    b. Paragraph 5, Broker’s Duties: This paragraph was modified to clarify that any agreement between Buyer and Broker regarding the existence, terms, or conditions of offers must be in writing.

    c. Paragraph 6, Buyer’s Duties:
    This paragraph was separated from Paragraph 5 for clarity, and to highlight the separation of the parties’ duties. This paragraph was modified to advise Buyer not to take, post, publish or display photos or video recordings of the property without Seller’s prior written consent. The term sub-agent was removed to make this paragraph consistent with the residential standard agency statute. The revisions to this paragraph also streamline the language regarding the existence of a recording system in the property and the possibility of video and/or audio recording.

    d. Paragraph 8(B)(1): This paragraph was modified to clarify that the Broker’s Fee is owed to Broker after termination only if the Buyer later acquires real property of the same type as discussed in the Purpose Paragraph 7.

    e. Paragraph 14: This paragraph was modified to include headings for each of the three disclaimers for purposes of clarity. This paragraph was also modified to include a new disclaimer with respect to wire fraud. Since wire fraud is a significant risk to Realtors® and consumers, the Buyer is being warned of its possibility and instructed about precautions to take in order to avoid becoming a victim of wire fraud. Buyers are being advised not to rely exclusively on electronic communications, and to orally verify any changes to wiring instructions with the Broker or with any third-party vendor before transmitting funds by wire transfer.

    2. K1208 – New Home Sales Contract

    This form was created to accommodate the needs of the membership, and should be used only in instances where the Buyers will buy a lot and then build a home.  This contract is not intended to be used when:

    • the owner already owns the lot;
    • the builder owns the lot and will be building a house; or
    • the builder owns the lot and has already begun building a house.

    This contract was drafted to follow the Residential Sales Contract as closely as possible.  However, some provisions, such as the inspection paragraph, differ significantly from the Residential Sales Contract.


    3. K1382 – Construction Financing and Appraisal Contingencies Addendum

    This financing contingency was created to be used with the New Home Sales Contract. This contingency can be used for all types of financing. 

    4. K1373 – Options Addendum (New Home Sales Contract)

    This addendum ensures that the parties to the New Home Sales Contract reduce to writing the options which are included in the base price, as well as those the Buyer wishes to add. 

    5. K1020 – Seller’s Post Settlement Occupancy Agreement and K1225 – Buyer’s Pre-Settlement Occupancy Agreement

    The changes to these two forms were administrative in nature to match the language which was recently updated in the Sales Contract, addressing the Property Maintenance and Condition. 

    6. K1360 – Well and Septic Contingency

    This change was administrative in nature. Paragraph 2B2 was amended to reflect a wrong reference to a previous paragraph. The old version incorrectly referred to paragraph A1. It has been amended to refer to paragraph B1. 

    7. K1336 – Exclusive Right to Sell Listing Agreement

    This change was administrative in nature. The second paragraph 26 was renumbered to 27.

     

  • July 1, 2017 Form Changes

    June 16, 2017
    1. K1371 – USDA Financing Addendum
      1. This addendum was created at the request of the membership.The addendum has been specifically drafted to address the requirements associated to a USDA loan (appraisal; amendatory clause; pest inspection).
    2. K1321 – Residential Sales Contract
      1. Paragraph 2 was modified to add USDA financing addendum as an option.
      2. Paragraph 3 was modified to add the word “deposit” before both delivery options.
      3. Paragraph 10:This paragraph was modified to delete the words “and/or other inspections” when the buyer waives his right to a home inspection.
      4. Paragraph 12: This paragraph was modified to add that the Septic Waiver Disclosure must be provided by seller (if applicable) per Section 32.1-164.1:1 Code of Virginia, and that State Board of Health septic system waivers are not transferable.
      5. Paragraph 24 was updated to add that the seller should provide at settlement keys and key fobs, access codes and digital keys.
      6. Paragraph 41:USDA Financing addendum was added as an option.
    3. K1342 – Home Inspection and Radon Testing Contingency Addendum
      1. This form was modified to distinguish between a contract contingent on a full home inspection and one where the buyer would only have the right to void the contract and not negotiate repairs or credit.This second option was created to clarify the practice of home inspection for informational purposes only.
    4. K 1344 – Contingencies and Clauses Addendum
      1. Paragraph 1(C) Seller’s Purchase of Another Home:This paragraph was modified to clarify the purpose of the contingency.This contingency is designed to allow a seller to ratify a contract for the purchase of another home and conduct any due diligence they deem necessary, such as home inspections, radon inspections etc.
      2. Paragraph 2(F) Real Estate Cooperative:This is a new paragraph to the contingencies and clauses addendum which is to be used in the event the property is part of a cooperative.This clause provides for the buyer’s right to void upon receipt of the required public offering statement.This clause tracks the statutory requirements associated with a sale of a unit in a cooperative.
    5. K 1360– Well and Septic Addendum
      1. Paragraph 1(B) Well and Well Water Inspection Contingency:This paragraph was modified to clarify that this contingency applies to the well itself and the well water.This means that a buyer who wishes to have well water testing done in addition to the water potability test outlined in paragraph 1(A), could conduct those tests under this contingency.In addition, this paragraph was modified to mirror the home inspection contingency process by creating an inspection deadline, a negotiation period and a buyer’s election period.
      2. Paragraph 2(A) Alternative System Maintenance Contract:This language is not new to the contingency.It has been set aside in its own paragraph to highlight its importance.
      3. Paragraph 2(B) Septic Inspection Contingency:This contingency was modified to mirror the home inspection contingency process by creating an inspection deadline, a negotiation period and a buyer’s election period.In addition, the description of the inspection has been modified based on recommendations from the field.As a result, every inspection will include a walk-over visual inspection and probing of the drain field area for a conventional system or a visual inspection of the alternative system.In addition, the buyer may elect to conduct pumping and inspection of all treatment tanks (excluding pump and recirculation tanks) and/or excavation as necessary to visually inspect the distribution boxes, test pumps and controls and evaluate the function of pumping or pressure dosed dispersal systems.Finally, in the event the buyer voids the contract he agrees to restore the property to substantially the same physical condition as it was prior to the septic inspection.
    6. K1020 and K1225 – Pre and Post Settlement Occupancy Agreements: No substantive changes were made to these forms.  The changes to these forms were required to continue to ensure that these occupancy agreements continue to be exempted from the VRLTA and VLTA. 
  • January 1, 2017 Form Changes

    • NVAR
    December 27, 2016
    January 1, 2017 NVAR Standard Forms Changes

    1.     Exclusive Agency Listing Agreement – K1337; Exclusive Right to Sell Listing Agreement – K 1336; and Exclusive Right to Sell Unimproved Land Listing Agreement – K1355.
    a.    Property.  The committee added language which tracks the MLS fields associated with listings such as the number of levels, whether there is a basement etc.
    b.    Conveyances.  The list of conveyances was amended to distinguish between the different types of fireplaces and their attending equipment.  
    c.    Broker Duties.  This paragraph was updated to include bolded language towards the end of the paragraph providing a blank to write out specific showing instructions for the property if applicable.
    d.    Marketing/MLS/Internet Advertising.  This paragraph was updated to comport with the reality of the life cycle of a listing and continue to be in compliance with the DOJ-NAR settlement.  To that end, we have separated the authorization for internet display from the rest of the VOW disclosures.  That way, a seller will first choose whether or not they will allow their listing to be disseminated on the internet.  If they choose yes, then there is a disclaimer which follows and the listing agent needs to complete section D.  If they say no, then section D may remain blank.  
    e.    Broker Compensation. The offer of compensation language which used to be in the marketing/MLS/Internet Advertising paragraph has been moved to this paragraph for consistency and clarity.  In addition, a new section C was added to address whether there will be a variable rate commission entered in the listing.
    f.    Current Liens.  This paragraph was updated to comport with the current practice.  A reminder was inserted for the seller that the loans on the property will need to be paid off at settlement.  The account numbers for the loans have been deleted as they were no longer necessary.  Finally a paragraph was added to ensure that sellers agree to comply with requests from settlement agents for loan payoffs.
    g.    Seller Duties.  The old miscellaneous information paragraph was divided into two paragraphs.  One entitled Seller Duties and the other Miscellaneous Information.  The Seller Duties paragraph was modified to provide for a disclosure of whether the seller has an audio recording system in the property followed by a warning and release of liability for real estate agents.  This paragraph was further modified to allow access to the property by the Broker’s unlicensed assistant to perform their duties as outlined in the real estate regulations.  
    h.    Utilities (Land Listing Agreement Only).  This paragraph was updated to include additional descriptions of the utilities which may be available at the property such as cable or fiber optics.
     
    2.    Sales Contract for Unimproved Land– K1209
    This form has been completely updated to match more closely our Residential Sales Contract.  However, the following three paragraphs are specific to this contract:  Fees and Expenses; Land Use Assessments/Rollback Taxes; and Study Period Contingency.

    3.    Rental Application – K1008
    The rental application was modified to include two additional questions:  Whether the tenant requires a visual smoke detector (to comply with new laws) and whether they are entitled to diplomatic immunity.

    4.    Lease – Common Law – K1333 and Lease – VRLTA – K1354
    These forms were updated to comport with significant legal changes.  
    a.    Lease Term.  The two options for lease term have been reduced to one option whereby the tenant agrees to vacate at the end of the lease term unless the parties have provided at least 60 days notice their wish to extend the term.  
    b.    Early Termination.  The paragraph was moved to follow immediately after the lease term paragraph.  No new language.  
    c.    Late Payment.  This paragraph was simplified.  The language now outlines clearly the fees associated with any late payments by the tenants.
    d.    Fixtures and Appliances.  This paragraph was modified to separate those fixtures and appliances which are part of the premises and those which are provided in as-is condition.  
    e.    Smoke and Carbon Monoxide Detectors.  This paragraph was updated to comply with recent changes in Virginia law.  The tenant may not tamper with carbon monoxide detectors and must maintain them where installed.
    f.    Access to the Premises.  This paragraph was clarified to state that the tenant allows the listing agent to place a sign, a lockbox and show the premises 90 days prior to the end of the lease term if the property is listed for sale and 60 days prior to the end of the lease term if the property is listed for rent.  In addition, language was inserted to warn tenants about the damages they may incur if they fail to allow showings to potential tenants or buyers.
    g.    Notice Regarding Diplomats.  This paragraph has been made into an informational paragraph for the benefit of the landlord explaining the possible consequences of renting their property to a diplomat.
  • July 1, 2016 Form Changes

    • NVAR
    July 1, 2016

     

    Chuck Cornwell, chairman of the NVAR Standard Forms Committee, discusses the July 1, 2016 Form Changes.


    July 1, 2016 NVAR Standard Forms Changes

    1.     Residential Sales Contract – K1321


    a.    Deposit. 
     The new language clarifies that the Deposit needs to be delivered to the Escrow Agent and not the real estate licensee in order to satisfy the terms of Deposit paragraph.  

    b.    Virginia Condominium Act.  This paragraph has been updated to comport with the new laws.  The Condo Act now allows a buyer to void a contract after receipt of the resale certificate OR receipt of a notice of non-availability of the resale certificate.  

    c.    Foreign Investment in Real Property Tax Act (FIRPTA).  This paragraph was added to the contract to handle circumstances under which the seller is a foreign person for taxation purposes and thus subject to FIRPTA.  If the Seller is a foreign person for taxation purposes, then in addition to checking the appropriate box in this paragraph, the seller will have to complete the FIRPTA Addendum – K1370

    d.    Wood Destroying Insect Inspection.  This paragraph was updated to comport with the practice and the inspection report provided by the pest inspection companies.  The validity of the report was extended from 30 days to 90 days.  In addition, the seller will now have to provide written evidence of treatment and repairs as may be applicable.

    2.    K1370 – FIRPTA Addendum
    This is a new form to the NVAR forms library which was created by the committee at the request and with the input of the attorney roundtable.  The increase in foreign buyers and sellers has created a need to address FIRPTA in our contract.  FIRPTA is a complicated federal law which affects the obligations of the parties under the contract.  These requirements are disclosed in this new addendum to allow the parties to get a head start on the process and ensure a smooth and timely settlement.

    3.    Financing Contingencies and Notices for their removal

    a.    Conventional, VA and FHA Financing Contingencies – K1339, K1340 and   K1359.  
    The changes to these contingencies represent a major shift in the mechanics of the financing contingencies in our contracts.  Previously, a contract with a financing contingency that was not satisfied by the financing deadline continued up to and including settlement date, unless the seller delivered notice to the buyer that the contract would become void.  Once a seller delivered that notice, the only option for the buyer was to deliver a written commitment from the lender or evidence of funds necessary to settle without financing, otherwise, the contract would become void within three days.  Under the new financing contingencies, a contract with a financing contingency that has not been satisfied by the financing deadline still continues up to and including the settlement date.  Seller also retains the option to deliver a notice to buyer, however, there is no longer an automatic voiding of the contract if buyer does nothing.  Instead, seller may, at seller’s option send a notice to the buyer alerting the buyer that the buyer has three days to either void the contract or proceed with the contract without the financing contingency in place.  If the buyer, after receiving the seller’s notice, does nothing, the contract is no longer contingent on financing and the buyer no longer has the protection of the financing contingency.  The buyer has to decide whether to void the contract or take the risk of no longer having the protection of the financing contingency.  Also, a sentence was added to provide that nothing shall prevent the parties from agreeing to some other remedy under mutually acceptable terms.   

    b.    Seller’s Notice Requesting Removal of the Financing Contingency – K1371.  This new form will allow the seller to send a notice to the buyer telling the buyer that they have three days to void the contract or the financing contingency will expire and the buyer will proceed to settlement without the protection of the financing contingency. 

    c.    Buyer’s Notice Removing the Financing Contingency – K1331.  This form has been updated to allow a buyer to remove any of the financing contingencies (VA, FHA, and Conventional) without having to show proof of funds or a written commitment letter.

    4.    K1335 – Seller Financing Addendum
    This form was updated to reflect current market practices.  It contains four major areas.  (1) The first requires the parties to agree as to whether seller financing will be a first, second or third deed of trust.  The addendum then allocates the responsibility for drafting the required documents, which version of documents will be used and who will pay for the drafting of these documents.  (2)  The second paragraph describes basic loan terms:  amount, payment of principal and interest, the term and any pre-payment terms.  (3) The third paragraph addresses taxes and insurance escrows.  (4) The fourth paragraph addresses the requirement for buyer’s credit documentation and approval by the seller.  The buyer has 10 days from the date of ratification to provide the seller with credit documentation (defined by agreement of the parties).  The buyer also grants the seller the right to obtain the credit documentation from third parties.  The paragraph then provides a remedy in the event the buyer fails to provide the required credit documentation and a remedy in the event of material changes in the buyer’s financial condition prior to settlement.

    5.    K1297 – Useful Information about a Transaction
    This form was updated to reflect the addition of a FIRPTA paragraph and addendum to the Residential Sales Contract.

    6.    K1207- Disclosure of Brokerage Relationship to Unrepresented Parties
    This form was updated to comply with the changes to the Agency statute in the Code of Virginia which will become effective July 1, 2016.  The updated statute makes away with the requirement to use the disclosure form in commercial transactions.  This form will now only be required in residential transactions.

    7.    K1363 - Disclosure of Dual Agency or Dual Representation in a Commercial Transaction

    This form was updated to comply with the changes to the Agency statute in the Code of Virginia which will become effective July 1, 2016.  The updated statute eliminates the previous classifications of licensees for commercial transactions.  Commercial agents will now act as agents or independent contractors.  They will no longer be known as standard agents and will no longer be able to practice as a limited service agent.

    8.    K1346 – Understanding Your Right under the Residential Property Disclosure Act
    This form was updated to comply with the changes to the Residential Property Disclosure Act in the Code of Virginia which will become effective July 1, 2016.  The statute was amended to add to list of disclosures that the owner makes no representation on covenants and restrictions which may affect the property or to zoning and permitted uses of adjacent parcels.   It advises the buyer to exercise due diligence pertaining to covenants and restrictions that may be recorded in land records that affect the real property or any improvements located on the property. Similarly, the law advises buyers to exercise due diligence in regard to the costs associated with maintaining, repairing, or inspecting any wastewater system, including any costs or requirements related to the pump-out of septic tanks.

    9.    K1299 – Request for POA packet and  K1024 – Request for Condo documents
    The form was updated to comply with recent changes in the Property Owner’s Association Act and the Condominium Act.  The form now tracks the statutes specification of who the owner of the property can have copies of the POA/Condo packet sent to.  In addition it has shortened the number of days which an owner has to pay for the packet from 90 to 60 days.  The association will be able to charge the owner directly if settlement does not occur within 60 days of the packet delivery.

     

     
  • January 1, 2016 Form Changes

    • NVAR
    January 1, 2016

    January 1, 2016 Form Changes

    Nine forms or contracts have been revised, all to be effective January 1, 2016.

    K1321 – Residential Sales Contract
    K1281 – Exclusive Right to Lease
    K1336 – Exclusive Right to Sell Listing Agreement
    K1337 – Exclusive Agency Listing Agreement
    K1355 – Exclusive Right to Sell Unimproved Land
    K1369 – Coming Soon Addendum to Listing Agreement
    K1344 – Contingencies and Clauses Addendum
    K1118 – Purchaser’s Limited Access to Premises Addendum
    K1210 – Walkthrough Inspections

    K1321 – Residential Sales Contract

    1. Cooperative Broker v. Buyer Broker. The introductory paragraph has been updated to address the term Buyer Broker. We received feedback from the membership that all cooperating brokers were not buyer brokers but could be independent contractors. Therefore we changed the term Buyer Broker to Cooperating Broker. This change is carried through the Contract and any addenda we are updating.
    2. Time is of the Essence. The Consumer Financial Protection Bureau created new rules which govern the practice of lenders and settlement agents. The industry is expecting that some delays in settlement may occur as lenders attempt to comply with the new regulations. The new contract language in paragraph thirty-five clarifies the carve-out to time is of the essence and the default provisions. In the event that the contract remains contingent on financing and the settlement must be delayed to allow the lender to comply with the TILA-RESPA Integrated Disclosure rule, such delay will not constitute a default by the Buyer. Under these circumstances, the paragraph also grants the Seller the right to void the contract.

    K1334 – Contingencies and Clauses Addendum

    1. Sale of Buyer’s Property and Kick-Out. Paragraph four of this contingency has been updated to clarify that in the event a further delay is required to obtain coinciding settlements, the Buyer can declare the contract void but that the parties retain the right to reach an agreement to extend the settlement date on terms acceptable to the Seller and the Buyer. 
    2. Settlement of Buyer’s Property. This contingency has been updated to clarify that in the event a further delay is required to obtain coinciding settlements, the Buyer can declare the contract void but that the parties retain the right to reach an agreement to extend the settlement date on terms acceptable to the Seller and the Buyer.
    3. Contingent on the Seller Purchasing Another Home. This contingency has been clarified. Rather than requiring a ratified contract for the purchase of another property to satisfy the contingency, the standard is now that the Seller has “identified another home for purchase”. This looser standard will give the Seller the ability to use the entire period allocated to the contingency rather than be obligated to remove the contingency upon ratification of a contract for purchase of another home. The membership requested this change to address the fact that the old language may not have allowed a Seller to remove key contingencies, such as a Home Inspection Contingency, prior to removing this contingency.

    K1336 – Exclusive Right to Sell Listing Agreement; K1337 – Exclusive Agency Listing Agreement; K1281 – Exclusive Right to Lease Listing Agreement; and K1355 – Exclusive Right to Sell Unimproved Land Listing Agreement

    1. Pre-Marketing (Coming Soon) Paragraph. The language in this paragraph has been clarified. The Pre-Marketing (Coming Soon) Addendum need only be attached if the property is going to be marketed prior to being entered in the MLS as an active listing.

    K1369 – Pre-Marketing Addendum to the Listing Agreement

    1. The form has been modified to include the ability to conduct Pre-Marketing activities on a property listed for lease.

    K1118 – Buyer’s Limited Access to the Premises Agreement (Decorator’s Agreement)

    1. This form had not been updated in years. The parties will now have to agree on an access date and the terms of the access by the Buyer or his representatives.
    2. The form allows access for the following purposes (1) to measure rooms, windows or show the property to contractors or decorators and (2) to allow the Buyer to deliver furniture to the property prior to settlement.
    3. The form specifically prohibits the Buyer from doing work on the property without prior written approval from the Seller.
    4. The form clarifies that the Seller will not be responsible for any damage or loss of the Buyer’s personal property and that in the event settlement does not occur, the Buyer will have 15 days to remove his personal property. After that, the Seller may dispose of the personal property in any way he deems fit.

    K1210 – Walkthrough Inspection(s)

    1. This form has been updated to track the Home Inspection Contingency. The form now accounts for the possibility that multiple walk through inspections were conducted
  • July 1, 2015 Form Changes

    • NVAR
    July 1, 2015
    The following forms have been revised, effective July 1, 2015:

    Changed:

    K1321- Residential Sales Contract - Click here to view the PDF Format
    K1281 – Exclusive Rights to Lease - Click here to view the PDF Format
    K1282 – Exclusive Right to Represent Tenant - Click here to view the PDF Format
    K1333 – Common Law Lease - Click here to view the PDF Format
    K1336 – Exclusive Right to Sell - Click here to view the PDF Format
    K1337 – Exclusive Agency Listing Agreement - Click here to view the PDF Format
    K1338 – Exclusive Right to Represent Buyer - Click here to view the PDF Format
    K1354 – VRLTA Lease - Click here to view the PDF Format
    K1355 – Exclusive Right to Sell Unimproved Land - Click here to view the PDF Format
    K1369 – Coming Soon Addendum - Click here to view the PDF Format

    1. K1321 – Residential Sales Contract

    1. Personal Property and Fixtures. The paragraph has been updated to address fuel tanks in one paragraph of the contract, rather than separately in the ADJUSTMENTS paragraph. The parties now must state whether fuel tanks are owned or leased, and include the number of tanks. The paragraph also clarifies that when fuel tanks are owned, the tanks convey. The paragraph further states that the content of the fuel tanks, namely the fuel, which remains in the tanks at settlement, will become the property of the Purchaser unless the parties agree otherwise in writing on the lines provided. The language addressing fuel tanks in the ADJUSTMENTS paragraph has been moved to this new provision.
    2. Alternative Financing. This paragraph has been clarified. It now defines the term Alternative Financing more specifically to mean any change to the terms included in the PRICE AND SPECIFIED FINANCING paragraph. The paragraph then outlines the steps to substitute Alternative Financing, and separately addresses substituting lenders.
    3. Title. In January 2015, the Standard Forms Committee updated the title paragraph to address the possibility of defects in title that would require a delay in settlement. It gave Purchasers the choice, on settlement date, of voiding the contract or reaching an agreement with the Sellers and delaying settlement until such time as the title defects could be remedied. However, feedback from the NVAR Attorney Roundtable indicated that the language in the paragraph could have been interpreted to deny the Purchaser the option to seek specific performance. The title paragraph has been updated to reflect that the Purchaser does not forfeit any of the remedies available at law.
    4. Time is of the Essence. The Consumer Financial Protection Bureau created new rules which govern the practice of lenders and settlement agents. As a result of the new regulations, the industry is expecting that some delays in settlement may occur as lenders attempt to comply with the new regulations. The new contract language provides a carve-out to the default provisions. In the event that the contract is contingent on financing and the settlement must be delayed to allow the lender to comply with regulatory requirements, such delay will not constitute a default by the Purchaser. Under these circumstances, the paragraph also grants the Seller the right to void the contract. 
    2. K1336 – Exclusive Right to Sell Listing Agreement, K1337 Exclusive Agency Listing Agreement, K1281 Exclusive Right to Lease Listing Agreement, and K1355 Exclusive Right to Sell Unimproved Land Listing Agreement
    1. The term Purchaser has been replaced by the term Buyer.
    2. Broker Duties. Has been updated to track more closely to the language in the Code of Virginia.
    3. Marketing. The paragraph has been updated to reflect the availability of a Pre-Marketing Addendum to the listing agreement.
    4. Types of Real Estate Representations. The explanation of non-agency was removed from the agreement, as it does not apply to the relationship at issue and created confusion.
    5. Broker Compensation. The specified options of Sub-Agency and Non-Agency compensation have been removed and replaced with “Other Compensation.” This was done in conjunction with MRIS’s removal of the sub-agency compensation field in Virginia listings.
    6. HOA and Condos. (Not applicable to K1281 – Exclusive Right to Lease) The new language more clearly allocates the duties for ordering the documents and the time frames for doing so. It gives the option of ordering them at the time of listing or within three days of contract ratification or “other”.
    7. Current Liens. The list of items has been re-ordered so that the first option is, “the property is not encumbered by lien.”.
    8. Service Provider Referrals. The new language provides protection to brokers who provide a list of service providers to their clients.
    9. Lease Term. (Applies only to K1281 – Exclusive Right to Lease) The landlord must state whether he or she will consider applicants whose source of funds comes through a housing voucher program such as section 8.

    3. K1338 – Exclusive Right to Represent Buyer Agreement and K1282 – Exclusive Right to Represent Tenant Agreement

    1. Term and Termination. Added the possibility of an early termination fee to the Buyer/Tenant agreements.
    2. Compensation. Moved the retainer fee language to this provision to track with the Listing Agreements. The paragraph also clarifies how the buyer/tenant agent is compensated, and the duties of the buyer in the event that the compensation offered in the MLS is less than the parties agreed in the brokerage agreement. In addition, the language was modified so that the Buyer will owe the broker compensation for the purchase of ANY property during the “protection” period after expiration or termination of the brokerage agreement. The previous language limited compensation to properties shown during the agreement period.
    3. Types of Real Estate Representations. The explanation of non-agency was removed from the agreement. It does not apply to the relationship at issue and created much confusion.
    4. Service Provider Referrals. The new language provides protection to brokers who provide a list of service providers to their clients.
    5. Paragraphs were re-ordered to ensure proper flow within the document.
    4. K1333 – Lease Common Law and K1354 – Lease VRLTA
    1. These documents were sent to Chip Dicks, VAR Legislative Counsel, for their bi-annual legal update. Mr. Dicks made some revisions to reflect 2014 and 2015 law changes. These revisions include additional remedies for landlords to collect damages and costs for an unlawful detainer action.
    2. Tenant Insurance. The lease has been updated to delete the requirement to name the Landlord as an additional insured under the Tenant’s renter’s insurance policy, as it was not possible in our marketplace.
    5. K1369 – Pre Marketing Addendum to the Listing Agreement
    1. This is a new form that was created by the Committee at the request of several large NVAR broker members. This document addresses the new “Coming Soon” status in the MLS, and lays out the marketing activities that the listing agent will undertake before making the property available for sale to the marketplace.
  • January 1, 2015 Form Changes

    • NVAR
    January 1, 2015
    One dozen forms or contracts have been revised, all to be effective January 1, 2015. This includes the Regional Sales Contract, the Virginia Jurisdictional Addendum, and others.



    Matthew Rathbun Explains The 2015 Form Changes

    Changed:

    K1321 – Residential Sales Contract - Click here to view the PDF Format
    K1345 – Virginia Jurisdictional Addendum - Click here to view the PDF Format
    K1116 – Release of Sales Contract and Deposit - Click here to view the PDF Format
    K1297 – Useful Information About Real Estate Transactions - Click here to view the PDF Format
    K1339 – VA Financing Contingency Addendum - Click here to view the PDF Format
    K1340 – FHA Financing Contingency Addendum - Click here to view the PDF Format 
    K1359 – Conventional Financing Addendum - Click here to view the PDF Format
    K1210 – Walk-Through Inspection - Click here to view the PDF FormatK1367 – Notice Voiding Contract - Click here to view the PDF Format

    Residential Sales Contract – K1321
    1. The Regional Sales Contract. The Regional Sales Contract has been significantly modified.  Upon review of the practice and forms available in DC and Maryland, the Standard Forms committee concluded that the Regional Sales Contract was a concept that had run its course.  After review of the various jurisdictional addenda, it became clear that the jurisdictional addenda modified the contract to such a point that there really was no longer a core contract that could be used across all three jurisdictions. In light of this, the Committee worried that for individuals infrequently practicing across jurisdictions, the Regional Sales Contract may have created a false sense of security in that agents may not have been aware of just how different each jurisdiction was.The committee created a Residential Sales Contract. This contract will no longer require the use of a jurisdictional addendum as the provisions have been incorporated into the body of the main contract. This contract will not be useable in other jurisdictions.
    2. Contract Date v. Date of Offer. The previous version of the contract used the term contract date in the first paragraph of the contract.  This lead to some confusion from the members as to the difference between contract date and date of ratification.  The term contract date was misleading because it was intended to capture the date the offer is made.  To that end, the committee changed the term contract date to the date of offer. 
    3. Price and Specified Financing. Significant confusion arose out of the old definition of specified financing.  We have changed the name of the paragraph so that now all that is in the Price and Financing paragraph constitutes “specified financing”.  This is intended to resolve questions around what is specified financing and when does a purchaser lose the protection of the financing contingency when modifying his financing.  A purchaser can change lenders and so long as the purchaser satisfies the requirements of paragraph 15, Alternate Financing.  Thepurchaser will continue to enjoy the protection of the financing contingency.  However, if a purchaser decides to go from a VA to a conventional loan, for example, the purchaser will have to execute the correct financing addendum and obtain the seller’s consent.
    4. Deposit. The purchaser now has to select whether they have already given the EMD to the escrow agent or whether they will deposit it in the future.  If they select the second option, they must state the number of days they have to deliver the EMD.  This change was made to allow out-of-town purchasers, who may not have delivered the EMD to the escrow agent yet, to sign an offer using electronic signatures and not make an untrue statement that they had already delivered the money.
    5. Delivery. The Delivery paragraph has been simplified.  The party has to select the method of delivery and then has a blank line to place the corresponding contact information.  So if the seller selects delivery is to occur by email, then the seller can place his email address and that of his agent on that line or just his email address or just that of the agent’s.  This will give parties more flexibility.
    6. HOA. This paragraph has been updated to reflect the changes in the law.  If the seller hand-delivers the HOA documents to the purchaser, he will have to obtain a receipt from the purchaser. The language which previously allowed the purchaser to select what format they would like the documents delivered has been modified to more closely track the statute, which leaves the selection of the format of the documents (electronic or hard copy) up to the seller.  The purchaser will now have to provide their preferred address of delivery for both electronic and hard copies so that the seller may deliver using whatever format they have the documents in.
    7. Condo. This paragraph has been updated to reflect the changes in the law.  If the seller hand-delivers the documents to the purchasers he will have to obtain a receipt from the purchasers. The language which previously allowed the purchaser to select what format they would like the documents delivered has been modified to more closely track the statute, which leaves the selection of the format of the documents (electronic or hard copy) up to the seller.  The purchaser will now have to provide their preferred address of delivery for both electronic and hard copies so that the seller may deliver using whatever format they have the documents in.
    8. Access to the Property. Walk through inspection can be conducted for a period of seven days prior to settlement.
    9. Wood destroying insects. The paragraph has been updated to allow for inspection of any wood destroying insects, rather than just termites.  This conforms with the practice of many inspectors and the requirements of many lenders.
    10. Title. The title paragraph addresses, among other things, the circumstances under which the parties realize close to settlement that there is a title defect on the property.  The paragraph then gave the option to the seller to delay settlement if the defect was of such a nature that it could be remedied within thirty days from the original settlement date.  The language did not address what would happen to the purchasers, their carrying costs etc.  The new language remedies that by giving the purchasers the choice, on settlement date, of voiding the contract or to reach an agreement with the sellers and delay settlement until such time as the title defects can be remedied.
    11. Title Insurance. The CFPB created new rules which govern the practice of settlement agents and their ability to provide purchasers quotes for title insurance.  As a result of the new regulations, the sales contract has to specify whether the settlement agent is allowed to quote the purchaser both a standard title insurance quote as well as an enhanced title insurance quote.  The new language in the contract gives the purchaser the choice of getting a quote for the standard or the enhanced coverage.
    12. Oil Tanks. The Adjustments paragraph has been updated to remove the confusion that arose from the sentence “Any heating or cooking fuels remaining in supply tank(s) at Settlement will become the property of Purchaser, unless leased.”  The provision now says “Unless otherwise agreed to in writing, any heating or cooking fuels remaining in supply tank(s) at Settlement will become the property of Purchaser.”

    2. K1345 – Virginia Jurisdictional Addendum

    1. The Virginia Jurisdictional Addendum was deleted as it was incorporated into the new Residential Sales Contract.

    K1116 – Release of Sales Contract and Deposit

    1. The Release of Sales Contract and Deposit form was amended to add a new paragraph warning the parties that the release may not end liability to their respective broker under the applicable brokerage agreement.

    K1297 – Useful Information About Real Estate Transactions

    1. The Useful Information About Real Estate Transactions form was amended to add gender identity to the list of protected classes in the fair housing paragraph, and to add a new paragraph addressing the Foreign Investment in Real Property Tax Act (FIRPTA).  The new paragraph explains what FIRPTA is, what duties each party may have, and that they should seek competent legal, tax, and/or financial advice.

    K1339 – VA Financing Contingency Addendum; K1340 – FHA Financing Contingency Addendum; K1359 – Conventional Financing Addendum

    1. The Deed of Trust paragraph in all three Financing Addenda had common language moved into the Price and Specified Financing paragraph of the new contract.  All that remains in the first paragraph of each addenda is language that is unique to that particular type of financing.
    2. Additionally, the list of seven, non-exclusive, reasons a Purchaser could be in Default have been removed.  The Seller Subsidy/Seller Loan Charges paragraph was retitled as “Seller Subsidy”. Finally, each form was modified in the Financing Contingency paragraph to add “Days after Date of Ratification” in after the blank.  Staff will instruct forms vendors to make this field flexible so that parties can enter either a number, or add a specific date and strike through the new language.
    3. On the Conventional Financing Addendum, the Appraisal Contingency paragraph 3.C. has been changed to mirror the VA and FHA Appraisal Contingency paragraphs which require the Purchaser to provide a written statement from the lender indicating the appraised value in the event of a low appraisal.

    K1210 – Walk-Through Inspection

    1. The language at the end of the form was clarified to state that neither the broker nor the settlement agent shall be liable in the event of one party breaching any repair agreements.

    K1367 – Notice Voiding Contract

    1. A new form was created to use when voiding the contract pursuant to a paragraph of the contract or one of the addenda.  The purpose of the form is to prompt parties who want to void the contract to point out which paragraph they are voiding under and will give agents pre-drafted language to use, rather than having agents create language when their clients need to void a contract.

    The following forms were updated to conform with the new Residential Sales Contract and with minor formatting changes:

    K1020 – Seller Post Settlement Occupancy
    K1025 – Purchaser’s Acknowledgment of Receipt of Condominium Disclosure
    K1033 – Addendum for Lead-Based Paint Testing
    K1117 – Addendum
    K1118 – Purchaser’s Limited Access to Premises Agreement
    K1126 – Purchaser’s Acknowledgement of Receipt of Property Owners’ Association Disclosure Packet
    K1225 – Purchaser Pre Settlement Occupancy Agreement
    K1273 – Notice
    K1306 – Escalation Addendum
    K1331 – Notice Removing the Financing Contingency
    K1342 – Home Inspection and Radon Testing Contingency
    K1343 – Home Inspection Contingency Removal Addendum
    K1344 – Contingencies and Clauses
    K1349 – Appraisal Contingency Notice
    K1351 – Short Sale Contingency Addendum to Residential Sales Contract
    K1356 – Information for Purchasers Concerning Bank Owned Properties
    K1360 – Private Well and/or Septic System Addendum

    Video: Matthew Rathbun Explains The 2015 Form Changes. To watch the video click here

    PDF: Click here to download the 2015 Contract Update overview in PDF Format
    (We encourage you to feel free to use this PDF for educational sessions, however you must keep all attribution to Matthew Rathbun and NVAR).