BROKER RISK MANAGEMENT
WEEKLY PRACTICE TIP
NEW SALES FORMS
Addendum – Generic (ADM-GEN) – For use with forms with a principal and an agent. However, use MT-LA and MT-BR forms for changes to listing or buyer representation agreements.
Addendum – Revised (ADM) – Revised to remove preprinted TDS option. Refer to Amendment to Prior Disclosure (APD) for changes to TDS or SPQ. Refer to ADM-GEN for forms with agents. Refer to AEA for changes to already executed agreements.
Amendment to Prior Disclosure (ADP) – New form to be used to make a change to TDS or SPQ. Contains advice about possible rights to cancel.
Liquidated Damages and Arbitration Additional Signature Addendum (LDAA) – This form is to be used with ASA form to add signers to purchase agreement to show whether signers agree to liquidated damages and arbitration.
Confidentiality and Non-Disclosure Agreement (NDA) – (was CND) Adds acknowledgment of broker duty to comply with NAR and MLS rules regarding posting photos. Adds optional language if NDA is limited to certain agents or not applicable to brokerage firm.
Team Member Exit Agreement (TMEA) – This form identifies: (a) reason for termination; (ii) how compensation and expenses will be addressed after the termination; and (iii) need to inform new broker.
REVISED SALES FORMS
Assumed Financing Addendum (AFA) – Explicitly makes buyer assumption a contingency. Adds advice to seller regarding seller’s VA substitution of eligibility to obtain another VA loan.
Additional Signature Addendum (ASA) – Reformatted to include bundled forms when agreeing to a purchase, listing, buyer representation or rental form. Refers to separate form for liquidated damages and arbitration.
Broker Compensation Advisory (BCA) – Modify to reflect California buyer representation requirement. Advises buyer’s broker not to accept more compensation than specified in buyer representation agreement.
Buyer Early Occupancy Addendum (BEO) – Adds subtitle instructing how to use this form for buyer pre-closing possession of twenty-nine or fewer days, otherwise use IOA.
Buyer’s Investigation Advisory (BIA) – Adds paragraphs for utilities, sewer and internet and also for solar power systems.
Buyer’s Investigation Elections (BIE) – Adds subtitle reminder that form only applies to buyer and buyer’s broker. It is not to be shared with seller or listing agent. Reformatted list of investigations to name 3 most common inspections first and then alphabetical order.
Buyer’s Inspection Waiver (BIW) – Adds subtitle reminder that the form only applies to buyer and buyer’s broker. It is not to be shared with seller or listing agent. Reformatted to include additional investigation recommendation paragraph.
Buyer Representation and Broker Compensation Agreement (BRBC) – Adds language (1) do not exceed maximum permitted Representation Period, and (2) to remind brokers of limiting compensation to amount specified in agreement.
Cancellation of Buyer (Or Tenant) Representation (COBR) – Makes form applicable to tenant representation. Allows for shorter, but not longer, time to give notice for exclusive representation cancellation.
Seller Contingency Removal (CR-S) – Adds contingency for seller confirming seller’s eligibility to obtain another VA loan if this loan is assumed rather than paid off.
Commercial Seller Property Questionnaire (CSPQ) – Adds question regarding seller awareness of reports inspection of “exterior elevated elements” including balconies.
Fire Hardening and Defensible Space Disclosure and Addendum (FHDS) – Adds box to indicate that fire hardening questions do not have to be answered if built on or after January 1, 2010. Adds question 2C regarding list of low-cost fire hardening retrofits which seller has completed. It provides buyer will that list as required by Cal Fire.
FHA/VA Amendatory Clause (FVAC) – It adds optional paragraph that form is being used when the purchase price changes.
Notice to Seller to Perform (NSP) – It adds optional paragraphs for seller to deliver Solar and Wood Balcony and Stair Addendum. Adds notice for seller to remove seller’s contingency regarding eligibility to obtain another VA loan if this loan is assumed.
Notice of Private Transfer Fee (NTF) – Form is reformatted and adds information about statute requiring recorded transfer fee document.
Probate Advisory (PA) – Clarifies that exemption for smoke alarms is solely for statement of compliance. Adds a paragraph about the need for ESD form. Adds smoke alarm paragraph in requirement section. Moves language so broker section is separate.
Possible Representation of More than One Buyer or Seller – Disclosure and Consent (PRBS) – Substantially re-written. Adds a paragraph for single agent dual agency.
Referral Fee Agreement (RFA) – Defines Referring Broker as one who gets paid for referring a client and Representing Broker who pays the referral fee and will represent the client. More clearly defines what transactions are covered and when. Still no signature line for the Client/Customer acknowledging the payment and receipt of the referral fee. That needs to be added.
Receipt for Reports (RFR) – Adds a box to indicate if each report sent by link. Adds seller signature to prior reports section confirming seller is unaware of other reports.
Residential Listing Agreement – Exclusive (RLA) – Adds reference to new form Short Sale Listing Addendum and removed reference to Short Sale Information Advisory. Adds language in ¶10 that seller’s broker will not confirm that the amount of compensation requested by buyer from seller is contractually owed by buyer to buyer’s broker.
(The following listing agreements were conformed to address changes to the RLA, where applicable: Residential Listing Agreement Seller Reserved (RLASR); Residential Listing Agreement – Open (RLAN); Commercial and Residential Income Listing Agreement (CLA); and Vacant Land Listing Agreement (VLL).)
California Residential Purchase Agreement and Joint Escrow Instructions (RPA) – Removes in 3G(3) buyer affirmation concerning buyer representation agreement. Adds language in 19D that escrow to follow 3G(3) compensation instructions and to offset any buyer payment by amount seller pays. Advises in 18A that buyer agent should not receive more compensation than specified in buyer rep agreement.
(The following purchase agreements were conformed to address changes to the RPA, where applicable: Residential Income Property (RIPA); Commercial Property (CPA); Notice of Default (NODPA); Vacant Land (VLPA; New Construction (NCPA); Condo Conversion (CCSPA);and Already Built Subdivision (ABSPA). )
Short Sale Addendum (SSA) – This form was substantially rewritten. It adds an explanation of short sale and information that a buyer should consider.
Short Sale Listing Addendum (SSLA) – This form modifies short sale information and advisory (SSIA) into short sale listing addendum for seller only. Moves two paragraphs from SSIA into Short Sale Addendum.
Team Agreement (TEAM) – Adds reference to the need to have Post-Agreement Terms in writing in the Team Agreement. Adds a Mentorship paragraph.
NEW RENTAL FORMS
Rental Property Owner Advisory (RPOA) – This form identifies areas for RPO client to investigate to determine risks of renting out property, such as rent and eviction control, upkeep, security deposits, screening fees, insurance and need to discuss with an attorney.
Move in Inspection Summary (SUM-MII) – This form only identifies items in rental that need attention. It can be used in place of entire MII, if the box is checked in MII.
Move Out Inspection Summary (SUM-MOI) – This form only identifies items in rental that need attention. It can be used in place of entire MOI, if the box checked in MOI.
Pre-Move Out Inspection Summary (SUM-PMOI) – This form only identifies items in rental that need attention. Can be used in place of entire PMOI, if the box is checked in PMOI.
Short Term (Vacation) Rental Advisory (SVRA) – This form identifies areas for the client to investigate to determine risks short term rentals such as HOA or city restrictions or prohibitions, taxes, and legal compliance. Advises the owner to consult with an attorney.
REVISED RENTAL FORMS
Move In Inspection (MII) – Adds a reminder to take photographs at the inception of the tenancy. It is reformatted so there is no need to check box if an item is satisfactory. It adds an option to automatically create a summary.
Move Out Inspection (MOI) – In April, it added: (i) instruction page; (ii) a reminder to take photographs of damage and repaired items; (iii) option to automatically create a summary; and tenant forwarding address. In June, it added the signature acknowledgment conformance and adds a video monitoring and doorbell to list of items.
Pre-Move Out Inspection Statement (PMOI) – The form was reformatted to match the MOI. Listed items deemed satisfactory unless a box checked. Adds an option to automatically create a summary.
Rental Property Owner Intake Form (RPOI) – It adds ¶ 25 containing questions about the owner to help determine if exceptions apply to rent and eviction control, security deposit and tenant credit reporting laws.
Offer of Tenant Positive Rental Payment Reporting (TRPR) – It adds language to the exemption box indicating that other parts of form not needed and not binding if completed.
DISCONTINUED FORMS
Disclosure and Modification to Buyer Representation Agreement (DM-BR)
Disclosure and Modification to Listing Agreement (DM-LA)
New Construction Property Disclosure Statement (NCDS) replaced by New Construction Advisory (NCA, 6/25)
Short Sale Information and Advisory (SSIA) replaced by Short Sale Listing Addendum (SSLA, 6/25). Some terms put into Short Sale Addendum (SSA, 6/25).
WEEKLY PRACTICE TIP: DO NOT FORWARD TO CLIENTS. This Weekly Practice Tip is an attorney-client privileged communication for the exclusive use of clients of Broker Risk Management and their agents. It may not be reproduced or distributed without the express written consent of Broker Risk Management LLP. The advice and recommendations contained herein are not necessarily indicative of standards of care in the industry but rather are intended to suggest good risk management practice.