Special Standard Forms Changes – August 14, 2024
As part of its normal process, NVAR’s Standard Forms Committee releases at least two forms updates each year — one in January and one in July. There are instances, however, when NVAR must consider market and industry developments, or feedback from practitioners, and update the forms accordingly.
As a direct response to member suggestions and in consultation with industry partners, NVAR’s Board of Directors (BOD) has approved updates to several NVAR Standard Forms for clarity and efficiency — effective August 14, 2024. We encourage you to review the updates outlined below, in addition to the recent July 1 Standard Forms updates that remain in effect.
Keep in mind that NAR practice changes resulting from the proposed settlement go into effect for all Realtors® by August 17, 2024. For information on the transition period between July 1 and August 14, including Frequently Asked Questions, please click here.
Overview of Recent Changes to the NVAR Standard Forms Approved by the NVAR BOD —Effective August 14, 2024
- K1338 – Exclusive Right to Represent Buyer Agreement:
- Update to Paragraph 8 – Compensation
- Reformatted for clarity.
- Removed authorization language for a Broker to request a specific amount of compensation in offers to a Seller, as it no longer applies in the current marketplace after developments in the industry that addressed fair housing concerns.
- K1336 – Exclusive Right to Sell Listing Agreement, K1337 – Exclusive Agency Listing Agreement, & K1355 – Exclusive Right to Sell Unimproved Land
- Update to Paragraph 7 - Seller-Paid Buyer’s Broker Compensation (SPBBC)
- Addition of language for consumer transparency and clarification that it is optional.
- Removal of “Seller will pay” language and pre-determined blanks because (1) there was confusion among agents about whether that was binding or not and (2) Seller may not determine an amount until participating in negotiations with the Buyer.
- Addition of language for Seller to authorize Broker to disclose Seller’s willingness to consider paying the SBBC, leaving the amount open-ended and up to negotiation.
- Addition of language regarding disclosure requirements pursuant to the NAR proposed settlement agreement. As part of the Agreement, written Seller approval is required in advance if the Seller wishes to disclose or market a specific amount of SPBBC to prospective buyers.
- In that case, this disclosure can be obtained via NVAR’s new form 1403 – Listing Agreement Amendment – Optional Buyer’s Broker Compensation, below.
- Removal of Paragraph 8 - Seller Subsidy
- Removed this provision because it was causing confusion as to its application and as to whether it was binding on the seller and broker.
3. NEW FORM – K1403 – Listing Agreement Amendment – Optional Buyer’s Broker Compensation
- This is a new optional addendum to be used if a Seller, in their sole discretion, wishes to disclose and/or market a specific amount of SPBBC to prospective buyers.
- This is where a Seller can let a Broker know:
- If Seller is willing to pay up to a certain amount of SPBBC and
- If Broker is authorized to disclose and/or market this amount.
We understand that the industry is evolving quickly, and we want to make sure that our forms reflect the most efficient, future-focused way of conducting business, while continuing to promote consumer transparency. We remain flexible and nimble so that we can move quickly to meet the needs of the industry. Through everything, NVAR is a partner to you.
For any suggestions or questions, please contact NVAR’s Legal Hotline.
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