- The Washington Times - Friday, June 15, 2007

In the midst of the excitement of buying or selling a home, few consumers want to take the time to read a lengthy document filled with legal terms that can be difficult to understand by someone without a law degree. In September 2006, the Realtor associations of the Washington area, including the Northern Virginia Association of Realtors (NVAR) and the Greater Capital Area Association of Realtors (GCAAR) introduced a new regional sales contract that simplifies the language of earlier contracts to make it easier to comprehend.

“The biggest difference between earlier contracts and this one is the clarity for consumers,” says Marcus Simon, an attorney with Hunzeker, Lyon & Leggett and manager of the McLean office of MBH Settlement Group.

“The contract spells out exactly what they need to do and has been designed to make it easier to understand,” Mr. Simon says. “Even the font has been made larger to make it easier to read.”

In part because of the larger typeface, but also because of additional educational portions, the new regional sales contract is longer than the previous version.

For instance, consumers are reminded that the settlement date is not optional, that the keys must be delivered at settlement and that “sellers need to keep their utilities on even if they have moved out so that inspections can be done,” Mr. Simon says.

The added length may make the contract seem complicated, but the simplified language should make the document more comprehensible for both buyers and sellers.

Adrian Hunnings, an associate broker and managing broker of Weichert, Realtors in Bethesda, says, “The hardest time to read the contract is when someone has fallen in love with a house. It’s important that as soon as a buyer has located a buyer’s agent they ask to see an advance copy of the contract. Any time an agent takes a listing, they should provide the seller with a copy of a sample contract to make sure they understand it.”

Mr. Hunnings recommends that consumers who do not understand the contract talk to an attorney before an offer is made to be certain they know the consequences of their actions.

Christopher Darby, an attorney and director of the District’s operations for Universal Settlements, says consumers need to understand that the sales contract is a legally binding contract, which means that both buyers and sellers need to be as informed as soon as possible, before an offer is made.

Donald DeBragga, a Realtor with Keller Williams Fairfax Gateway office, who chairs the NVAR Standard Forms Committee, says regional committee members worked on the new contract for three years to determine what would be most helpful to clients if they had a weak agent.

“We developed a contract that could actually be read by a buyer or seller so they can understand the deadlines that need to be met and protect their earnest money deposit and the value of the home,” Mr. DeBragga says.

“During the boom market, some of the new start-up companies did not have the knowledge and experience to do contracts correctly. We need to do everything possible to safeguard our clients’ position and to protect all consumers,” he says. “The new contract has less legal mumbo-jumbo, so there are fewer surprises at the settlement table for buyers and sellers.”

Mr. DeBragga says that he believes the old contract was lopsided toward buyers and that this one is more neutral.

Mr. Darby thinks both the old and new regional contracts are neutral.

“The old contract was not intentionally ambiguous, but now there is not much room for misunderstanding,” says Mr. Darby. “The contract can be slanted in favor of the buyer or the seller, but that requires agreement between the two sides. Fewer contingencies favor the seller, while more contingencies mean a contract is skewed to the buyer.”

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