In almost all aspects of real estate transactions, there are documents which are indicated as “standard” and by that categorization, there is an implication that these are safe to sign, because other people have utilized these documents. There are “standard” purchase and sale agreements for both free-standing home and condominiums and “standard” leases, for both residential and commercial transactions. Many times the real estate professional with who you are working will encourage you to sign the “standard” documents, as is, because, well, “they are standard”.
The question really becomes “for whom is the documents standard. My response, at least on the purchase and sale side, is that there is bias in the “standard” purchase and sale agreement toward the Seller, and is a Buyer signs a “standard” purchase and sale agreement, without directing some attention to changes therein, which are almost always agreed to by the Seller, the Buyer is disadvantaged. For example, the “standard” Greater Boston purchase and sale agreement provides that if for some reason the Buyer defaults on the transaction, the Seller has the option of retaining the Buyer’s deposit, or, suing the Buyer for specific performance, in which event the Buyer’s financial stakes can rise based on the ultimate purchase price of the home.
There are other aspects of the “standard” agreement which can be problematic to the Buyer. The “standard” agreement does NOT provide that the home needs to be delivered in “broom clean condition, free of garbage and debris, and all personal property not being transferred to the Buyer by the Seller” If that provision is not added, the Buyer will be required to accept the premises “as is” and spend extra money removing junk and cleaning up. Almost always, when an attorney for the Buyer requests the inclusion of a broom-clean provision, the Seller consents. The problem is that this provisions is not in the “standard” agreement.
There are many aspects of “standard” leases which can fall into the same category. Most standard leases are silent as to what the Lessee should do when there is an emergency situation on the leased premises. There are aspects of maintenance of fixtures and appliances which are not addressed. Even the simple aspects of how a lease is extended, or terminated for cause, are left vague. These can be important elements in a lease, and specific responses should be worked out, and committed to writing, either in the lease itself, or in an addendum which is attached to the lease.
If this post sounds like shameless advertising for the need to include an attorney in important transactions like real estate purchases or leases, I suppose I stand “guilty as charged”. But, I sincerely believe that appropriate representation early in the game can save large attorney fees and expenses somewhere down the road. If you are encouraged to sign a document because it is “standard”, at least consider what “standard” really means, and whom “standard” really benefits. Almost always, that person is NOT the Buyer or the Tenant, and spending a little time and money upfront can give you peace of mind in the long run.