News

Forms Update – Escalation Addendum and More

The following new forms and changes to existing RIAR Forms were sent to Instanet, dotloop, and zipLogix on August 23, 2018.

CHANGES TO EXISTING FORMS:

Cesspool Replacement Disclosure – Changes “removal” to “replacement” to make it clearer that abandoned cesspools may be left in place or removed.
New Construction Purchase and Sales Agreement – Removes references to Lead Disclosures. Effective on January 1, 2018, residential dwellings that were built on or after January 1, 1978 are exempt from lead disclosure laws.
Dwelling on Leased Land Purchase and Sales Agreement – Adds assessment language to Section 12 to accommodate cottages and homes on leased land in communities that impose multi-year assessments.
Changes to all RIAR Purchase and Sales Agreements: The section numbers below are from the Single-Family Purchase and Sales Agreement. These sections may have different numbers in the other versions of the purchase and sales agreement.
·Section 2. Date of this Agreement: Clarifies when the first day of the agreement starts for counting purposes. This will help to resolve confusion about how to count the days for the Inspections Contingency.
·Section 3. Purchase Price: Removes “cash” to prevent buyers from bringing large sums of cash from questionable sources to the closing.
Adds a Wire Fraud Warning to advise buyers, sellers, and real estate licensees to be careful when wiring funds.
·Section 4. Closing Date/Place: Replaces “Registry of Deeds” with the proper name: “Land Evidence Records in the municipality where Property is located.”
·Section 8 Personal Property and Fixtures: Updates this section to remove items that are addressed in the Personal Property Agreement.
·Section 16. Inspections Contingency: Defines “holidays” as federally or state recognized holidays.
·Section 17. Required Documents: Changes the name of Section ____ from “Correction of Errors” to “Required Documents” to make the purpose clearer. Adds a sentence to state that fees associated with requirements from Buyer’s lender will be paid by Buyer.
·Section 18. Notices: Adds a space for the license number of the brokerage or principal broker of the office to comply with TILA-RESPA Integrated Disclosure (“TRID”) requirements.

·Section 25 Governing Law: Adds a new section to clarify that the purchase and sales agreement is controlled by Rhode Island law.
· Representation of Authority – Adds new language to the box above the signatures. Requires all parties, such as trustees, managers of limited liability companies, or heirs to an estate, to state that they have the legal authority to enter into a binding agreement.

NEW FORMS:
Escalation Addendum (NEW) – This form allows buyers to increase the amount of their offer automatically to exceed the amount of a competing offer from another buyer by a set amount. It automatically prints with an explanation of the form and how to use it.
Additional Parties Addendum (NEW) – This form offers space to add the names and contact information of multiple sellers and buyers that may not fit on the purchase and sales agreement or other forms. State-Wide Multiple Listing Service has approved a similar form to add more parties to the listing agreements.
Letter of Intent (NEW) – This offer form can be used as a negotiation tool prior to preparing a purchase and sales agreement. It includes signature lines only for the buyer to avoid creating a binding contract.

Questions? If you have questions about the content of these changes or when the changes will be available on Instanet, please contact the RIAR Legal Department at 401-432-6945.
If you use a forms provider other than Instanet, please check with your forms provider if you have any questions about when the changes will be available.

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