Standard Forms Spotlight: Does a Seller Have to Document They Have Reviewed an Offer?
CATEGORY: Standard Forms
TAGS: Contract of Purchase and Sale Reviewing Offers Signing Officers Standard Forms Standard Forms Spotlight
You've listed a great property on behalf of your seller client. With your marketing efforts and the attractive offering, you have received multiple offers. Sounds like an ideal scenario, right?
On the seller's side, it certainly can be. But when it comes to potential buyers, there might be some concerns. How does a buyer know if there are multiple offers? Will the buyer have a chance to change their offer? Will all the offers be presented to the seller? How does the buyer have peace of mind that they had a fair shot at closing the deal?
With these questions in mind, REALTORS® might be wondering if a seller has to document the fact they have reviewed an offer in order to help ease the potential buyer's concerns.
This was a concern raised at a recent Standard Forms Committee meeting. More specifically, a request was received to update the Contract of Purchase and Sale (CPS) to include an initial box for the seller to sign, indicating that the "seller has reviewed the offer."
This would give the potential buyer proof that their offer was viewed, and help in calming any suspicion of an unfair advantage.
But is it necessary?
While the concern is a valid one, the Committee decided against adding a signature box to indicate that the seller has reviewed the offer.
The first reason is that there are already current tools and practices in place for buyer's and seller's agents to confirm the offer submitted was reviewed, including:
- the buyer's agent presenting the offer, where appropriate;
- the use of the Real Estate Council of British Columbia's Disclosure to Sellers of Expected Remuneration (DTSER) form as documentation the for the seller's agent's file that the disclosure was made;
- having the managing brokers contact each other directly to verify that the offer was reviewed; the manager could base the response on the DTSER being submitted to the office;
- having the seller stroke a line through the form, writing the date and acknowledging they considered the offer but did not accept it before forwarding it back to the buyer's agent as evidence of the disclosure.
In addition to the practices already being in place to help ensure fair dealing, the second reason why the Committee decided against a change is that other challenges may arise by having the seller initial offers that they do not intend to accept.
For example, if a seller accidentally initials in the space for acceptance instead of the space for reviewing the offer, they may be in a situation where they have sold the property twice. By using one or more of the practices listed above, a buyer's agent can be confident in telling their client that they are getting a fair shake.
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