By Oliver E. Frascona
Special to InsideRealEstateNews
A review of the Short Sale Addendum to the Buy/Sell Contact, Section 8.4, is needed to properly follow MLS rules. It also is a broker’s fiduciary duties to the seller and buyer. The goal of the MLS is an accurate listing of properties that are available for sale now, without restriction. Categories include, “Active,” those that are under contract, “Pending” or “Short Sale Approval Pending” or other indication, depending on the MLS provider.
When a property is sold with the Short Sale Addendum as a part of the contract the selection of 8.4.1 vs. 8.4.2, it will dictate how the listing broker makes a change or not to the MLS listing. Read section 8.4.1 and 8.4.2 in the new short sale addendum (formerly 8.3.1 and 8.3.2)
8.4. Early Termination
■ 8.4.1. Not Applicable. This § 8.4 shall not apply.
■ 8.4.2. Applicable. Both the buyer and seller have the right to terminate the contract by a written notice to the other party, providing it is received on or before a Short Sale Acceptance. Additionally, a seller has the right to accept subsequent offers from other buyers prior to Short Sale Acceptance without liability to buyer.
If 8.4.1 is checked, the property is properly “Under Contract” and should so reflect in the MLS. (This is my preference if the buyer and seller are serious about the house.)
If 8.4.2 is checked, then the seller and buyer are not bound to a contract as each can get out at any time without the consent of the other. Seller can accept another offer and buyer can buy another house. (Not my preferred choice.) In this event I believe the accurate indication in MLS for the benefit of all, seller and buyer, is “Active.” That is because when a buyer submits an offer, the seller can accept it on the spot.
It is good for both sides. And it provides correct information to the public. As brokers, that is what you strive to accomplish on each and every transaction.
Oliver E. Frascona, Esq. is a shareholder with the law firm of Frascona, Joiner, Goodman and Greenstein, P.C. Since 1974 the Boulder-based firm has been providing efficient, aggressive and creative legal representation for its clients. They can be reached at (303) 494-3000 or at this link.