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Would your contracts pass this test?

By Bryant Tutas

Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

July 27, 2006 09:01 AM

Received an offer for one of my listings yesterday. At least I think it was an offer. It came in on a standard Far/Bar purchase contract. The only problem, with what I was able to read, is half of the information was either missing or incorrect. Unless of course the Buyer meant to ask for a 21 day closing and include a 30 day financing contingency. Now I admit I'm not very good at math but it looks like this Buyer has up to 9 days after closing to get final loan approval. Since the address is wrong on the contract he will probably need this extra time to locate the house he just bought.

Fortunately for this Realtor I will take the time to write up a new contract and hopefully we will be able to negotiate a deal. After all my Sellers just want to sell and the Buyer just wants to buy.

As Realtors it is very important that we are able to write legible and binding contracts for our Sellers and Buyers. There is no excuse for not being able to do this. We our actually bound by Article 9 of our NAR Code of Ethics to ensure that all contracts and addendums are properly completed, signed and dated by all parties. Take this seriously as our customers and clients are relying on us to protect their interest. I can't remember where I heard it but someone told me once "to write every contract as if I had to defend it in front of a Judge." Would your contracts pass this test?

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Jacqulyn Richey

Prominent Realty Group - Las Vegas, NV

Las Vegas Real Estate

I remember those days. Thankfully now everyone uses Zipforms, so offers come nice and legible the first time.

Jul 27, 2006 09:52 AM

Bryant Tutas

Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL

Selling Florida one home at a time

Every body uses Zipforms! You are so lucky. Most of the offers I receive are hand scribbled. Even though our Board has all the contracts online for free. Can type E-mail,copy,fax or whatever.

Jul 27, 2006 10:01 AM

Louann Nudi

TOVIJE Enterprises, Inc. - Indianapolis, IN

Even if the Zipforms are used and they come out nice and neat, they don't "reason" or "think" for the REALTORS. Bryant, your points in this post are well taken. I frequently review offers that have deadlines outside the closing date....Zipforms don't help if REALTORS can't think for themselves and take the necessary care and precautions for their customers to correct the mistakes and make the contract solid...or better yet, make sure these errors don't happen in the first place! Excellent post and a good training topic for my next meeting! Thank you as always for your thoughtful comments.

Jul 27, 2006 11:09 AM

Joe Keyes

Team One - Coldwell Banker Residential Brokerage - Hill AFB, UT

I do find it frustrating when I have to teach some agent on the other side about how to fill out a contract properly, not that I'm an expert or an authority. But I do appreciate working with someone that can at least do that. I work for the largest brokerage in Utah and luckily the training I've had has kept my mistakes to a minimum. They say ‘If you haven't been sued, you haven't been in the business long enough'. I plan on beating the odds.

Jul 27, 2006 11:47 AM

Getting then to fill it out properly is the first step. I guess the next step would be to get them to actually read the contract!

Jul 27, 2006 12:09 PM

Taiane de Gregorio

Sunvest Communities USA - Orlando, FL

Exactly, I agree with Bryant!

Most of the new agents don't even care about reading the contract, they just memorize the blanks that have to be filed in and that's it. I guess they think that every contract it's going to be the same I don't know!

Jul 27, 2006 03:30 PM

Margaret Rome Baltimore 410-530-2400

HomeRome Realty 410-530-2400 - Pikesville, MD

Sell Your Home With Margaret Rome

..to write every contract as if I had to defend it in front of a Judge."

This point is true also with emails and voice mails.

Baltimore,Md

Jul 27, 2006 05:28 PM

TAMMY DEHART

Coldwell Banker Hartung and Noblin - Tallahassee, FL

Realtor, GRI, NAPW

I agree with your concept, I have come across too many contracts where they go through and fill in the blanks without thinking, next thing you know they have the wrong name or date or closing, because they are so used to doing it. Every transaction is different and I always make sure I read before filling in the blanks or accept an offer. Good point Bryant!

Jul 28, 2006 12:58 AM

Branden Schroeder

Gybeset Homes - Annapolis, MD

As a former practicing attorney, I view the entire issue of realtors writing contracts on behalf of clients as fraught with potential problems. I'm not sure of any other profession that has non-attorneys prepare legal documents in connection with transactions that have as much potential liability. What other industry has daily transactions worth hundreds of thousands of dollars, and in some cases millions, entered into in most cases without legal representation by both parties (or least with an attorney reviewing the documents before execution)?

True, ZipForm documents are usually approved by counsel of the local real estate board, but there are plenty of areas for realtors to neglect an important area of the contract or mess up some addendum.

I'm certainly not saying realtors can't do a competent job of preparing these forms. Most do. But non-attorney realtors must also be very careful when drafting contracts and addendum and when explaining the contract to clients to avoid engaging in the unlicensed practice of law. Perhaps I'll get into more detail about this issue as a separate full blog post.

Jul 28, 2006 07:55 AM

"JT" Prevatte

Former Agent - Fayetteville, NC

This is why I always try to use my realfast forms program. I really don't like to handwrite a contract...too much room for error.

Sep 20, 2006 02:15 PM

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Bryant Tutas

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