Obviously there are processes and instruments that come into play on every real estate transaction and my readers get my call on every ball and strike. Today I am picking on one of the key instruments: the brand new iteration of the FAR/BAR contract.
To cut to the chase, the revisions to the contract would be great if they worked with the rest of the real estate world.
I think that if a real estate contract is going to integrate with the lending industry, then the lending industry should probably be involved in some aspect of its assembly.
We just went through this whole new adventures in contracts experience that stipulated that if you want to put items such as televisions and hot tubs as part of the sale, then you need to have a third party certified appraiser assess the item; then the loan amount gets reduced by the appraised amount of the personal property. This of course means more money out of the buyers pocket at closing.
So why would a newly revised real estate contract (on the very first page…Item 1 section d) detail personal property? This is classic right hand not knowing what the left hand is doing!
At this point, our industry has become an exercise in vigilance and maybe that’s not the worst thing. You just have to make sure that you hire the very best Realtor, mortgage lender, and home inspector possible so you know they are staying current on the stuff that changes daily to ensure that you’re equipped for every eventuality.
At the end of the day, this is no “fill in the blanks, sign here, and submit industry”…we’ve become a “you’ll-shoot-yourself-in-the-foot-unless-you-learn-how-to-stay-a-couple-of-steps-ahead-of-absolutely-everything” kind of industry!