By: Gina L. Campanella, Esq., FACHE
The Statewide New Jersey Realtors® Standard Form of Real Estate Sales Contract has recently, on September 12, 2016, undergone some changes. While some of these changes are significant, others are simply a matter of cleaning-up the form as it was previously written. When reviewing the new Contract and confirming it to any other documents you may use for the transaction, be sure to note that the revisions have caused many paragraphs to be renumbered.
Among the less significant changes are:
Modification of time frames in several paragraphs where the default number of days is either eliminated and replaced with a “blank”to be filled in or, in the alternative, areas that were previously “blank”now have parenthetical defaults to a certain number of days should the section still be left blank. Be sure to review all time frames and number of days in which items must be completed in the Contract for a full understanding of what has changed. Also note that some time frames that were previously counted in calendar days are now counted in business days.
The maximum cost that the Seller is obligated to pay to obtain a Certificate of Occupancy will now default to 1.5% of the purchase price if an amount is not specified in the Contract.
New Paragraph 26 now includes information about the Mansion Tax, the Exit Tax, the Foreign Investment in Real Property Tax act of 1980 and adjustments for any other state and federal taxes that may be due at closing.
Attorneys representing Buyers and Sellers are now contractually obligated to keep Broker’s informed of Contract negotiations.
The more significant changes to the Contract include:
A new paragraph (paragraph 31) has been added which gives the Broker(s) an equitable lien on the property should there be a failure to pay the Broker(s) as required under the Contract.
The following paragraphs have all been removed from the standard Contract and now must be added as Addenda to the Contract if they are applicable to the transaction:
Buyer’s Property Sale Contingency
Lead Based Paint Disclosure (Pre-1978)
Private Sewage Disposal (Other than Cesspool)
Private Well Testing
Properties with Three (3) or More Units
Underground Fuel Tank(s)
This overview is not an exhaustive list of every change. If you have not done so already, be sure to compare the new