Did You Realize – “No Response Deems Acceptance”?
There are 8,400 Realtors in Portland today and about 75% of them get into selling homes because, “They love houses and working with people”.
Let’s face it, selling homes appears to be fun and easy. With the onset of electronic transaction companies such as Redfin and Zillow, and the ease of entry to becoming an agent, a career in real estate sounds like a breeze.
Many buyers seem to discount both the potentially binding legal contract that they are entering when they initiate a purchase, and the diligence required on their agent’s part to guide them through an 11-page legal document with several potential “gotcha” clauses.
Buyers may be putting their contractual fate in the hands of a Realtor who may not be well versed in the technicalities of the document and these clauses.
There are four such clauses engrained in today’s standardized Residential Sale Agreement. Each clause exists to protect the buyer, but what you may not realize is that if you don’t respond in writing to raise questions, object to a due diligence finding, or request an extension, you are 100% fully committed to the purchase. In other words, “NO RESPONSE, DEEMS ACCEPTANCE”.
Here are the four clauses:
- Buyers have a 5-business day “Right of Rescission” period from the time they have an accepted agreement and have received the Seller’s Property Disclosure Statement. If the Buyer does not rescind their offer prior to 5PM on the 5th business day after receipt, no further question or objection can be raised under this contingency.
- Buyers typically have 10 business days to perform their home inspection/due diligence and submit a repair addendum. If the buyer does not perform inspections and submit an addendum requesting repairs within the inspection period, they have committed to buying the home in “as-is” condition. Additionally, most buyers do not understand that the seller has no obligation to respond to the buyer’s proposed repair addendum. In this instance, the buyer may choose to proceed with purchasing the home in “as-is” condition or terminate the transaction. However, this termination must be delivered in writing prior to 5PM on the 10th business day of the home inspection period.
- Buyers typically have a 5-business day period to review the Preliminary Title Report. This critical document informs the buyer of any and all encumbrances on the property as well as the CC&Rs (covenants, conditions, & restrictions). It clearly states in the agreement that “buyer’s failure to timely reject in writing, shall constitute acceptance”.
- The Townhome / Planned Community Homeowners Association Addendum has a 5-business day response time for buyers upon receipt of all the specified HOA legal documents and minutes. To terminate the transaction, the buyer must deliver an unconditional disapproval of these documents in writing by 5PM on the 5th business day; otherwise, the buyer shall be deemed to have approved the documents.
While it may appear that these documents are for the protection of the buyer, it is critical that the seller’s agent is diligent with the delivery of all documents and verifies all dates with the buyer’s agent to ensure all parties agree on deadlines. Each of these clauses have the potential to become a focal point in a transaction and could lead to unwanted and unneeded stress that is easily avoided by competent, proactive agents, who KNOW real estate and the ins-and-outs of the sale agreement.
At ELEETE Real Estate, each of our client teams always has at least one experienced Senior Broker on the file, and we continuously emphasize to our agents their fiduciary responsibility to properly communicate these crucial clauses that impact each transaction.