How will the new Pennsylvania Agreement of Sale be viewed by agents, buyers and sellers. Where does the balance lie between buyer and seller?
There have been some major changes and the agreement looks very different. One agent asked me while we were going over these changes in a class "Is this Agreement more in favor of the buyer?" My response was to ask how she viewed the current agreement. Many of those present agreed that the current, the 2005 version is very favorable to the buyer and leaves the seller without many teeth.
I think going over this new agreement that several of the changes are improvements on the sellers favor. Deadlines are tightened up, causing the buyer to take action earlier and respond quicker so that if an agreement is going to not proceed the sellers home can be returned to the market place quicker. The mortgage blocks have changed in that there is now an option for loans to match loan to value ratios, a quasi appraisal contingency, although of course you can use the old appraisal contingency if you wish. Deadlines for mortgage applications are tightened up including payment for appraisals and application fees. Buyers pay when they apply for their mortgage and cannot put off arranging the appraisal.
But I think many of the changes being made are more for clarity for both parties. Sellers assists are moved to where the offer of compensation is and not tucked away further in the agreement a big improvement allowing the seller to clearly see what is actually being offered.
Inspections are more defined and grouped all together, including insurance, which had been stranded when it was introduced. I still think that there has been no definition of what is 'reasonably acceptable" terms but as this does not seem to have been addressed obviously it has not caused problems for sellers or buyers that have resulted in law suits. Several more inspections are defined and buyers now initial to acknowledge the inspections being carried out, a more significant step of selection. Gone are the two options with a combined result that allows buyers to accept the property, terminate or propose a written corrective proposal within the deadlines of the contingency.
There is a large section on distribution of deposits in the case of disputes allowing both buyer and seller to come to an agreement ahead of time on how to distribute deposits in the case of a dispute and what happens to deposits if a dispute does go to litigation.
These are just a few of the major changes, but what do you think of the new agreement? In whose favor does it fall or is it more evenly balanced between buyer and seller?
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