CONTRACT DISCLOSURES

 

A.    Any agreement or contract for the sale or lease of a property interest in a development that requires a public report shall contain the following language in large or bold print above the signature portion of the document:

 

THE DEVELOPER SHALL GIVE A PROSPECTIVE PURCHASER A COPY OF THE PUBLIC REPORT AND AN OPPORTUNITY TO READ AND REVIEW IT BEFORE THE PROSPECTIVE PURCHASER SIGNS THIS DOCUMENT.

 

B.    Any agreement or contract for the sale or lease of a property interest in a development shall conspicuously disclose the nature of the document at or near the top of the document.

 

C.    The contract shall indicate where the earnest money or down payment, if any, will be deposited and shall include the name of the title company, the name of the broker’s trust account, or other depository.

 

D.    Any agreement or contract for the sale or lease of a property interest in a development where a down payment, earnest money deposit, or other advanced money, if any, is paid directly to the seller and not placed in a neutral escrow depository, shall conspicuously disclose this fact within the document, and the purchaser shall sign or initial this provision indicating approval in the space adjacent to or directly below the disclosure in the purchase contract or agreement of sale.  The following disclosure shall be written in large or bold print and shall be included in the public report, purchase contract, and agreement of sale.

 

PROSPECTIVE PURCHASERS ARE ADVISED THAT EARNEST MONEY DEPOSITS, DOWN PAYMENTS, AND OTHER ADVANCED MONEY WILL NOT BE PLACED IN A NEUTRAL ESCROW.  THIS MONEY WILL BE PAID DIRECTLY TO THE SELLER AND MAY BE USED BY THE SELLER.  THIS MEANS THE PURCHASER ASSUMES A RISK OF LOSING THE MONEY IF THE SELLER IS UNABLE OR UNWILLING TO PERFORM UNDER THE TERMS OF THE PURCHASE CONTRACT.

 

E.     Any agreement or contract for the purchase or lease of an unimproved subdivided lot, or any unsubdivided land, shall contain the following language in large or bold print above the signature portion of the document:

 

THE PURCHASER OR LESSEE HAS THE LEGAL RIGHT TO RESCIND (CANCEL) THIS AGREEMENT WITHOUT CAUSE OR REASON OF ANY KIND, AND TO THE RETURN OF ANY MONEY OR OTHER CONSIDERATION BY SENDING OR DELIVERING A WRITTEN NOTICE OF RESCISSION TO THE SELLER OR LESSOR BY MIDNIGHT OF THE 7TH CALENDAR DAY FOLLOWING THE DAY THE PURCHASER OR LESSEE EXECUTED THE AGREEMENT.  IF THE PURCHASER OR LESSEE DOES NOT INSPECT THE LOT OR PARCEL BEFORE THE EXECUTION OF THE AGREEMENT, THE PURCHASER OR LESSEE SHALL HAVE SIX MONTHS TO INSPECT THE LOT OR PARCEL, AND AT THE TIME OF INSPECTION SHALL HAVE THE RIGHT TO UNILATERALLY RESCIND THE AGREEMENT.

 

 

F.     In areas outside of groundwater active management areas established pursuant to Title 45, Chapter 2, Article 2, if the Director of Water Resources, pursuant to § 45-108, reports an inadequate on-site supply of water to meet the needs projected by the developer or if no water is available, the State Real Estate Commissioner shall require that all promotional material and contracts for the sale of lots in subdivisions approved by the Commissioner adequately display the Director of Water Resources’ report or the developer’s brief summary of the report as approved by the Commissioner on the proposed water supply for the subdivision.

 

G.    If the assurance for the subdivision improvements is a certificate of occupancy program, the contract or an addendum to the contract shall contain the following language:

 

      ESCROW SHALL NOT CLOSE UNTIL THE CITY OR COUNTY OF ______________ ISSUES ITS OCCUPANCY CLEARANCE AND ALL SUBDIVISION IMPROVEMENTS ARE COMPLETE.

 

H.    For applications seeking HUD Certification, see the HUD Supplement to this application for HUD’s rescission language and additional contract disclosures required by HUD.