The Rhode Island Association of REALTORS® Executive Committee has approved some changes to the RIAR purchase and sales agreements.   These changes will be made available to all authorized forms vendors on September 15, 2021.   Keep in mind that some vendors post changes within a week or two while others take a month or longer.

All RIAR Purchase and Sales Agreements

» Mortgage Contingency - Appraisals

In 2020, RIAR added language to the Mortgage Contingency section of the Purchase and Sales Agreement to help speed up the appraisal process by requiring a buyer to authorize the lender by a specific deadline to arrange for an appraisal.   Unfortunately, this language has not made a meaningful difference in changing the timing of appraisals.  Sellers rarely enforce it and some REALTORS® are confused by whether the appraisal must be authorized or conducted by a specific deadline.   The following sentence will be removed from Section 7(b) Mortgage Contingency:

“(ii) If this Agreement is subject to an appraisal that is required by the Buyer’s Lender, Buyer shall authorize Lender to order an appraisal within _______ days of the Date of this Agreement.”

» Purchase Price and Deposits

This section has been changed to clarify that the “time is of the essence” checkbox applies only to deposits and not to the final payment due at closing. The sentence now reads,

“Time is of the essence as it applies to the Deposits in Section 3.  (check one)   □ Yes    □  No.”

» Condominium Purchase and Sales Agreements

Currently, RIAR offers a combined New Condominium/Conversion Purchase and Sales Agreement.  The Rhode Island inspection law applies to conversions but does not apply to new construction, so RIAR has created two different agreements:  the New Construction Condominium Purchase and Sales Agreement to be used for a new building of condominiums and the Condominium Conversion Purchase and Sales Agreement for the conversion of an existing building into condominiums.

RIAR also streamlined the Taxes, Adjustments, and Other Assessments and the Additional Obligations sections of these agreements and the Condominium Resale Purchase and Sales Agreement.

For more information, please contact the RIAR Legal Department at 401-432-6945 or email [email protected]