THE REQUEST FOR REPAIR: A REALLY GOOD FORM

December 20th, 2011 at 12:08 am

As many of you have heard me say in the past, CAR provides many good tools for its membership, including many of the forms we use in our transactions. One of my favorites, and one which we do not see used as consistently as we would like, is the Request for Repair (Form RR). This document is good for a number of reasons. First, it provides a simple, written record of what problems the buyer knew about and what repairs she asked for and, furthermore, what the seller agreed to repair. The RR is only one page, and gives you both the buyer’s requests and the seller’s response. That makes it very convenient for everyone to use and makes their agreement very clear. On the other hand, when the RR is not used, I cannot tell you how many times the parties end up fighting over just what their agreement was. The buyer thinks the seller agreed to fix a certain thing and the seller says no. Typically, in these instances the repair agreement was either verbal of done by e-mail and was therefore not as clear as necessary.

Next, if the parties desire, the RR provides them with a place to negotiate a credit rather than repairs. We are seeing this more often, where the seller would rather not actually perform repairs. As a result, the RR gives the parties a place to memorialize the agreed upon credit.

Finally, and perhaps most importantly, the RR gives the parties, especially the seller, the opportunity to ensure that the repair negotiations are complete and that the buyer is willing to move forward. As you know, section 2A of the RR reads as follows: “If Buyer agrees to (i) remove in writing the contingency(ies) identified on the attached Contingency Removal form…” then Seller will agree to make certain repairs. In other words, if the buyer is willing to commit that the identified repairs are all they are asking for, and will therefore remove the identified contingency, then the seller will make the repairs. Of course, this means that the listing agent must always attach a Contingency Removal form to the RR and must always at least check box 1E for removal of the Buyer’s investigation. That way, the seller would only be bound to make repairs if the buyer gives up their right to cancel over the property’s condition and agrees to move forward with the identified repairs only. If that contingency is not removed, of course, the buyer can still cancel the deal and therefore can request more repairs. So, by using this form, along with the CR, the seller is protected, and only needs to make the agreed upon repairs if the buyer agrees that they will not ask for anything else.

So remember, always us the RR form when negotiating repairs. It makes the parties’ agreement very clear. And, as importantly, if you represent the seller, make sure to attach a Contingency Removal to the RR and check the Buyer’s Investigation box so the buyer loses their leverage and can’t ask for anything else. This way, the agreement that is memorialized on the RR will be the final one regarding repairs and the parties can move forward knowing exactly what is expected of them. As always, please contact us with any questions you may have

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