The May 1, 2022 revisions to the GAR Forms have been released. There are 2 new Special Stipulations (SS) that should be of value to you. These can also be found in the GAR Special Stipulations.
SS 110 NO COMMISSION OWED BY THE BUYER
Notwithstanding any provision to the contrary contained in this Agreement, Broker shall not look for Buyer to pay any portion of Broker’s Commission pursuant to this Exclusive Buyer Brokerage Engagement Agreement.
2.CONTINGENCY FOR RECEIVING CONDOMINIUM QUESTIONNAIRE
As noted in a previous post, Fannie Mae and Freddie Mac have created additional conditions to the HOA Approval process since the terrible condominium collapse last year in Florida. Significant deferred maintenance at that condominium was a factor in the building collapse. Property management of condominiums will now be required to answer additional questions regarding deficiencies, defects, substantial damages and deferred maintenance, as well as other new questions. To protect a buyer’s earnest money, in the event that the approval process takes longer than the time limits of financing or appraisal contingencies, we recommend adding a Special Stipulation to all condominium purchase agreements that allows the buyer to terminate if the property cannot be qualified by FNMA or Freddie Mac. The following is a new SS released by GAR for this situation. Note that the SS calls for the buyer’s termination right based on a number of days from the binding date. The time period can, of course, be adjusted as the situation requires.
SS 528 CONTINGENCY FOR RECEIVING CONDOMINIUM QUESTIONNAIRE
If the Property is a condominium unit, and if the Buyer is obtaining a loan to purchase the Property, this Agreement shall be contingent upon the condominium in which the unit is located being eligible for financing and approved by Buyer’s lender. If Buyer obtains written notice from Buyer’s lender indicating that (1) it is declining Buyer’s loan application because the condominium in which the unit is located is ineligible for financing or (2) Buyer’s lender is unable to determine whether the condominium in which the unit is located is eligible for financing because the HOA or management company for the condominium has not provided sufficient information for the lender to make such a determination, then Buyer may terminate this Agreement by providing written notice to Seller, along with the notice from Buyer’s lender, within ____ days from the Binding Agreement Date. If Buyer timely provides such notice, then Buyer shall be entitled to the return of their earnest money. If Buyer does not timely provide such notice, then the contingency contained in this paragraph shall be waived and of no further force or effect. This contingency is applicable irrespective of whether there is any loan, financing, or all cash, contingency exhibit attached hereto and shall survive the expiration, wavier, or satisfaction of the same.
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