The GCAAR Regional Sales Contract is widely accepted and used in the Washington, DC metro area as the standard real estate sales contract. As of January 1, 2012, some changes are going to alter the contract significantly.
In response to the growing use of e-signatures, new language has been added allowing purchasers and sellers to indicate on the contract itself whether or not they intend to execute the contract by e-signature. Previously, an addendum was used for this purpose.
Also, a separate conventional financing addendum has been created, replacing the conventional financing paragraph that is currently in the Sales Contract.
Finally, the most significant change is the removal of the infamous Paragraph 7 from the Regional Sales Contract. Paragraph 7 is the “Equipment, Maintenance and Condition” paragraph, more commonly referred to as the “Property Condition” paragraph by agents.
Currently this paragraph requires that “…except as otherwise provided, the existing appliances, heating, cooling, plumbing, electrical systems and equipment, and smoke and heat detectors (as required), will be in normal working order as of the Possession Date.”
The new contract removes this language and converts the contract into an “AS IS” instrument. This will hopefully reduce some of the confusion that currently exists since Paragraph 7 is often replaced by the Addendum of Clauses’ inspection contingency paragraphs.
Federal Title & Escrow Company intends to offer several presentations outlining the differences in the contracts and allowing for Questions and Answers in regards to contract matters. Please check our blog as we make further updates on this material.
Until then, here’s a copy of the current GCAAR regional sales contract.