The California Association of Realtors released this new form (attached) called the Coronavirus Addendum/Amendment (Form CVA). The recent events surrounding the spread of the COVID-19 strain of the Coronavirus has led to many questions about the continued enforceability of real estate contracts under the circumstances. Rather than risk an uncertain outcome in court or arbitration over such disputes, Buyers and Sellers may elect to address the unanswered issues contractually. This form allows parties to agree on a way forward for existing contracts and address potential issues in contracts that have not yet been formed.
The form provides that when circumstances related to the Coronavirus are affecting the closing date, the Buyer and Seller agree to extend escrow for a default of 30 days. There is also an optional clause where the buyer and seller can mutually agree to cancel the Agreement and an additional optional clause where the buyer or seller can cancel even after removing the loan contingency if inability to fund is caused by COVID-19 related loss of income.
I am advising that all agents implement this new form immediately into any of your current or new transactions. This form can be used either as an amendment to a contract that is already in place or as an addendum to a contract that has not yet been formed.
Your Zutila team continues to monitor the latest developments of the COVID-19 and will provide new information as we have it. As always, we are available to aide in transactions or answer any questions you may have at anytime.
Office Manager | Broker