April 30, 2010
There’s a new Sheriff in town, and its name is the updated Residential Purchase Agreement from the State of California. Beginning on Wednesday, April 28th, this new contract version took effect, and during the next couple of weeks we’re going to take you step by step through the changes that affect both how you purchase a home, and also what protections and changes are now available to home owners and home buyers while using this new contract.
The new contract is intended to accomplish a couple of things.
First, the contract simplifies the process somewhat by providing context for a number of forms that have to be filled out by buyers and sellers. Take the issue of agency, for example.
Before a Realtor can begin working with you on the contract itself, an agency relationship has to be formed. Both the buyer and the agent have to discuss what agency is, and how that agency relationship will affect the duties and obligations of both during the purchase process. There continues to be an “Agency Disclosure” form that outlines the obligations of the listing agent, the selling agent, the buyer and seller, but information about this form and its importance now appears on the first page, prominently, on the Residential Purchase Agreement itself. This should make it more apparent to the buyer or seller that this agreement (Agency Disclosure) is important.
Secondly, the Residential Purchase Agreement (RPA) follows a much more logical path, correcting some past fuzzy areas, making it clearer to both parties the timelines and who is responsible for costs and disclosures, and (sort of an insider correction for Realtors themselves) making it easier for buyers and sellers to know where to initial and sign.
In the next few weeks we’ll talk about specific aspects of the RPA, making you more informed, and hopefully making your purchase or sale of your home easier to understand.