A few weeks ago, C.A.R. released its June 2022 Forms Release with 6 new forms and 36 revised forms. Here are some helpful frequently-asked questions about the forms from our own agents: 

Should We Include the New FAAA If There Will Be No Appraisal or Appraisal Contingency? The answer is yes. You should include the Fair Appraisal Act Addendum (FAAA) in a sales contract, regardless of whether the buyer will be getting an appraisal or whether the buyer has an appraisal contingency. As background, starting July 2, 2022, every contract for the sale of real property must include the FAAA Notice that appraisals must unbiased, objective, and not influenced by considerations of race, color, religion and other discriminatory factors. C.A.R. recently incorporated the FAAA by reference into the RPA and other C.A.R. sales contracts. C.A.R. also auto-bundled the FAAA with the sales contracts in zipForms.

What If the Seller Fails to Complete Paragraphs 3B and 3C of the FHDS? Those provisions might just look like they’ve not yet been completed. The Fire Hardening and Defensible Space Disclosure and Addendum (FHDS) is generally required for sellers of one-to-four residential units located in a high or very high fire hazard zone (unless the seller is TDS-exempt). Most FHDS sellers currently fall within the scope of the default language set forth in paragraphs 3B(1) and 3C(1) with no checkboxes. If that’s the case, the seller will not be checking any of the boxes provided in the remainder of paragraphs 3B and 3C. So those paragraphs may look like they have not yet been completed, when in fact, the default language applies.

How Does a Buyer’s Agent Take Advantage of the New Backup-Buyer Option in an SMCO? The box for paragraph 8 of the Seller Multiple Counter Offer (SMCO) (where the seller signs a second time to enter into a binding contract), has been expanded to include backup buyers. So as the buyer’s agent, if your buyer just lost out to another buyer in a multiple offer situation, you can contact the listing side to encourage them to put your buyer in Backup Position #1 by simply checking the box in paragraph 8B, and attaching a Backup Offer Addendum. It’s now a very easy process. There’s no need for another seller counter, buyer counter, addendum, or withdrawal of counters.

Where Do I Find More Info? See our last 2 Legal Tips of the Week for a C.A.R. Standard Forms Update and a comprehensive FHDS Guidelines for BHHSCP Agents. More information is also available on C.A.R.’s Standard Forms webpage (password-protected for C.A.R. members only).

Copyright© 2022 Berkshire Hathaway HomeServices California Properties (BHHSCP). All rights reserved. Any unauthorized reproduction or use of this material is strictly prohibited. This information is believed to be accurate as of July 5, 2022. It is not intended as a substitute for legal advice in individual situations, and is not intended to nor does it create a standard of care for real estate professionals.