cooldcre: DC Property will be sold "AS IS" after 1/1/12

New condos in DC Districtre.com The Isaacs Team LLC

DC Property will be sold "AS IS" after 1/1/12

DC Property will be sold “AS IS” after 1/1/12

PARAGRAPH 7 Eliminated from new GCAAR 2012 contract version

BREAKING NEWS: The buyer protection clause known as Paragraph 7 will be eliminated from DC’s new GCAAR real estate contracts as of the first of the year, making DC home purchases essentially “As Is.”

The changes to the 2012 contract form have now been approved and are in the process of being implemented.

What is Paragraph 7?

“Paragraph 7” relates to home inspection contingencies. It is the “Equipment, Maintenance and Condition” proviso requiring sellers to warrant that existing elements such as heating and cooling, appliances, plumbing and electrical systems and equipment, among other items, are in working order at time of delivery.

Many is the repair or replacement credit that has been afforded buyers in connection with this clause and while sellers may rejoice that it is now going the way of the Virginia seller disclosure, buyers will not rejoice that they no longer have that additional layer of protection.

What changes are being made?

According to professionals preparing to train title and real estate pros on the changes, the following will take effect in the new year: 

1. Paragraph 7 language "Seller warrants that, except as otherwise provided, the existing appliances, heating, cooling, plumbing, electrical systems and equipment, and smoke and heat detectors (as required), will be in normal working order as of the Possession Date." will be eliminated.

2. Paragraph 7 language "Seller will deliver the Property in substantially the same condition as on the Contract Date and broom clean with all trash and debris removed/" will stay.

3. Paragraph 7 language “Seller will deliver the Property in substantially the same condition as on the Contract Date and broom clean with all trash and debris removed. Buyers will now have a choice of how to complete this section, with ‘date of contract’, ‘date of inspection’, or a date of their choice (blank space).

The changes do not affect termite inspection language or other clauses and agreement forms.

DC will retain its disclosure form, required by DC statute, and under common law in the District, if there are any defects to the property that the seller is aware of, they must disclose them to the buyer. So there is still protection for buyers in place, although it is unlikely to relate directly to repairs/credits during a transaction.

Protecting Buyers

So how do real estate agents continue to protect buyers’ interests in relation to property condition? The old fashioned way—with thorough inspections, careful drafting of inspection contingencies and inclusion of a home warranty policy.

Other changes

More changes are in the works. Currently in the approval process is the elimination of the financing contingency section of the sales contract. Instead of being included in the contract itself, a conventional financing addendum will be created in addition to existing FHA and VA financing addendums.

The DC Jurisdictional addendum will be altered accordingly.

More information on DC home inspections

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Comment balloon 1 commentThe Isaacs Team llc • October 14 2011 07:29PM

Comments

Brilliant!
Posted by Darrin about 7 years ago

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