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As Mark Twain once famously said, “the reports of my death are greatly exaggerated.” Much is written about the disruption of the real estate industry and the desire of technology related real estate companies to cut out the real estate agent from the transaction. There is no question that a number of companies and business plans wish to do just that with the help of private equity financing.
With few exceptions, parties to a real estate contract can mutually agree to terms of the contract. However, certain laws and requirements may prevent parties from agreeing to certain contractual provisions, even if both parties are in agreement. Some examples are the buyer’s choice of settlement agent or the buyer’s right to cancel under the Property Owner’s Association Act.
I graduated law school in 1997. Over the years, I have been asked all kinds of legal questions by friends, acquaintances, colleagues and clients. I’ve also been asked to represent people in various areas of the law. I have turned down most of these requests or not been able to fully answer questions because it was not within my sphere of competence.
Throughout Virginia form contracts are provided by Realtor Associations to the membership they serve to create efficiencies through the use of legally enforceable contracts for the purchase and sale of residential real estate. These form contracts provide a familiarity and comfort level for real estate agents, who in Virginia enjoy an exception to the unauthorized practice of law rules for contract work they engage in for clients they represent.
The standard Residential Real Estate Contract used in Northern Virginia requires a Buyer who has a home inspection contingency to provide, among other things, an entire copy of the home inspection report to the Seller by the contingency deadline. Suppose a Buyer does so and in connection with the delivery of the home inspection report to the Seller, the Buyer also delivers a notice voiding the contract. May the Seller share a copy of the original Buyer’s home inspection report with a subsequent Buyer of the Seller’s property?
The sooner a buyer discovers a defect in their home after closing, the more likely it is the buyer will believe that the seller or listing agent did not disclose something they should have.
The question presented in Virginia is one of disclosure obligations.
While legal counsel may always be sought after in these scenarios, the following is a general analysis and clarification of rights and duties. To start with, a buyer must understand the significance of caveat emptor – buyer beware!
On July 1, 2012, Virginia became the first state in the country to authorize remote online notarization. There are roughly 23 states that have approved remote online notarization laws, yet despite becoming law in Virginia almost 8 years ago, it seems only recently we have been bombarded with articles and talks about the promise of E-closings. Most recently, a bill was introduced by U.S. Senators Mark Warner (D-VA) and Kevin Cramer (R-ND) called the “Securing and Enabling Commerce Using Remote and Electronic Notarization Act of 2020 (the “SECURE ACT”). This SECURE ACT would permit immediate nationwide use of remote online notarizations.
