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Redfin’s Contract Class
September 19, 2012 Austin, TX
Follow: @RedfinAustinLike: http://www.facebook.com/RedfinAustin
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A Little Bit About Who We AreRedfin is a real estate brokerage that has helped over 20,000 people buy or sell a home; 97% would refer us to a friend.
● Customers, not commissions● Informed decisions● The right home for the right price
No obligationGet back a portion of our commission
Benefits of a MLS Powered Site
All the homes for sale: 30% more listingsYou see what the agent sees: 4x the dataReal-time market data: photos, details of just-sold homes
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To Buy or Not to Buy
Why You Should Buy a Home● You have a family and need room to grow● You expect to stay put for 5 or more years● You want a home that is difficult to rent● You’re handy & and ready to invest● You’ve saved up a down payment
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Why You Shouldn’t Buy a HomeYou don’t have a good reason like family or schoolsYou can’t afford the down paymentYou can rent for much lessYou plan on moving soonYou’re worried about job security
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Making an Offer
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Completing the Offer Wizard
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Completing the Offer Wizard
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Completing the Offer Wizard
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Completing the Offer Wizard
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Offer Documentation
To submit an offer we need to include several documents:
Pre-approval LetterProof of Down Payment FundsCopy of an Earnest Money Deposit CheckOptional: FICO (credit) ScoresOther forms: RELO Addendum; REO Addm. etc.
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Offer Forms
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Offer Forms
Disclaimer: The scope of this class is to discuss the process for drafting an offer to purchase a home, the documents involved and the strategies for getting an offer accepted.The presenter is not a real estate attorney. Questions pertaining to the legal ramifications of the following contracts should be directed to a real estate attorney.
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Offer Forms
Redfin Buyer Representation Agreement (RBRA)
Establishes the representation relationship between you (Buyer) and Redfin
Documents expectations of Redfin and you, the Buyer
Protects Redfin’s claim to a commissionEstablishes the buyer’s Redfin refund policy
Who signs this document:Buyer and Buyer’s Agent (Selling Agent)
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Offer Forms
Disclosure And Consent For Representation Of More Than One Buyer Or Seller (C.A.R. From DA)
Discloses that the Broker (Redfin) may represent both the Buyer and Seller in a transaction.
An individual Redfin Orange County agent will NOT represent both the Buyer and the Seller in any one transaction.Who signs this document:
Buyer and Buyer’s Agent (Selling Agent)
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Offer Forms
Market Conditions Advisory (C.A.R. Form MCA)
Advises Buyer about determining the price to offerWarns Buyer about the importance of contingenciesWarns Buyer about the risk of writing multiple offers
Who signs this document:Buyer and Buyer’s Agent (Selling Agent)
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Offer Forms
Disclosure Regarding Real Estate Agency Relationship (C.A.R. Form AD)
Defines agency representation and relationshipsDescribes the fiduciary duty expected of real estate
agents
Who signs this document:Buyer and Buyer’s Agent (Selling Agent)Seller
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Offer Forms
Residential Purchase Agreement (C.A.R. Form RPA)
Main offer form that contains terms including:Offer price and termsClosing cost splitsContingency periodsEtc…
Who signs this document:Buyer and Buyer’s Agent (Selling Agent)Seller and Seller’s Agent (Listing Agent)
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Offer Forms
Buyer’s Inspection Advisory (C.A.R. Form BIA)
Advises Buyer to conduct thorough home inspections
Outlines the importance of proper inspection of many different parts of the home and it’s surroundings
Who signs this document:BuyerSeller
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Offer Forms
Wood Destroying Pet Inspection And Allocation Of Cost Addendum (C.A.R. Form WPA)
Outlines who is responsible for procuring and paying for a Wood Pest Report
Establishes who is responsible for correcting conditions discovered by Wood Pest Report
Section 1 & Section 2 conditionsWho signs this document:
BuyerSeller
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Short-Sales & Bank Owned
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Offer Forms
REO Advisory (C.A.R. Form REO)
Informs Buyer of Seller exemptions in a bank owned transaction
Establishes what is still required of the SellerRecommends Buyer have any addendums or
amendments provided by Seller be reviewed by legal counselWho signs this document:
BuyerSeller
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Offer Forms
Short Sale Addendum (C.A.R. Form SSA)
Establishes timelines regarding short sale approval and contingencies
Outlines expectations of Buyer and Seller regarding short sale approval period
Who signs this document:BuyerSeller
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Offer Forms
Short Sale Information And Advisory (C.A.R. Form SSIA)
Defines short saleInforms Buyer and Seller of the alternatives to a short
saleDiscloses the difficulties that may arise during a short
sale transactionWho signs this document:
Buyer and Buyer’s Agent (Selling Agent)Seller and Seller’s Agent (Listing Agent)
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Offer Forms
Bank Addendums / Amendments / Counter Offers
Often added to bank owned (REO) transactionsModify terms of the RPA and may limit the bank’s
liabilityOften add daily per diem if Buyer closes lateRedfin can’t provide guidance or opinion on bank
addendums, attorney review is strongly encouraged
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Other Forms
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Other Forms
Request For Repair (C.A.R. Form RR)
Used to ask the Seller to fix or credit Buyer for conditions discovered during the inspection period
Seller is NOT obligated to fix items other than as required by local law
RPA states property is sold in ‘As-Is’ condition
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Other Forms
Contingency Removal (C.A.R. Form CR)
Removes some or all of Buyer’s contingencies and commits Buyer to the purchase
If Buyer cancels transaction after removing contingencies deposit may be at risk
Should not be signed until Buyer is confident in their ability to close and satisfied with any terms agreed upon during negotiations
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Questions? Writing Class
March 27, 2012 – Irvine, CA