The New Jersey 118 form, also known as the Statewide New Jersey Realtors® Standard Form of Real Estate Sales Contract, is a legally binding document used for the sale of one to four-family residential properties or vacant one-family lots that have a written listing agreement in place. It outlines the terms and conditions of the real estate transaction, including but not limited to the parties involved, purchase price, manner of payment, and various disclosures. Before signing this form, it's crucial for both buyers and sellers to read and understand the given notice about their rights, risks, and obligations under the law, and the importance of legal representation. Ready to take the next step in your property transaction? Click the button below to fill out your New Jersey 118 form.
In the bustling real estate market of New Jersey, the New Jersey 118 form stands as a crucial document for both buyers and sellers navigating the complexities of property transactions. This form, integral to the legal framework governing real estate sales, serves as a notice to both parties about their rights, obligations, and the importance of understanding and reviewing the contract before signing. It underscores the necessity for each party to consider legal representation, as real estate brokers and title companies are explicitly prohibited from providing legal advice. The form outlines the roles a real estate broker might play, highlighting that a broker could represent the seller, the buyer, both, or neither, and stresses that the title company does not represent either party. Furthermore, the form explicitly mentions that without a lawyer, buyers and sellers may not have representation during legal negotiations or at closing, a step identified as pivotal given its implications on one's rights and responsibilities. It elaborately discusses the contract's significance, the potential financial implications of reports and surveys, and the risks a buyer assumes by proceeding without legal counsel, especially concerning title issues and property conditions that might affect the property's value. With protective measures woven into its sections, the form empowers parties to make informed decisions regarding attorney representation, thereby emphasizing the serious legal and financial considerations involved in real estate transactions.
NOTICE
TO BUYER AND SELLER
READ THIS NOTICE BEFORE SIGNING THE CONTRACT
The
Law
requires
real
estate brokers
to
give
you the following
information
before you sign
this
contract.
It
us to
tell you
that
you must read
all
of it
before you sign. The purpose
is to help you
in
purchase
or
sale.
1)
As a real estate broker, I represent:
the seller, not the buyer;
the buyer, not the seller;
both the seller and the buyer;
neither the seller nor the buyer.
The title company does not represent either the seller or the buyer.
2)
You will not get any legal advice
unless you have your own lawyer. Neither I nor anyone
from
the title
com
pany can give legal advice
to either the
buyer or the seller. If you do
not hire a lawyer, no one
will
represent
you
in legal matters now or at the closing. Neither I nor the title company will represent you in those matters.
3) The contract is the most important part of the transaction. It determines your rights, risks, and obligations. Signing the contract is a big step. A lawyer would review the contract, help you to understand it, and to negoti ate its terms.
4) The contract becomes final and binding unless
your
lawyer
cancels it
within
the
following three business
days. If you do not have a lawyer, you cannot change
cancel
the contract
unless
other party agrees. Nei
ther can the real estate broker nor the title insurance company change the contract.
5) Another important service of a lawyer is to order a survey, title report, or other important reports. The lawyer will review them and help to resolve any questions that may arise about the ownership and condition of the property. These reports and survey can cost you a lot of money. A lawyer will also prepare the documents needed to close title and represent you at the closing.
6)
A buyer
without a lawyer
runs
special risks. Only a lawyer can advise a buyer about what to do
if problems
arise
concerning
the purchase
of
property. The problems may be about the seller's
title, the size
and
shape
of the property, or other matters that
may affect the value of the property. If either the broker or the
title
pany knows about the problems, they
should tell you. But they may not recognize the problem, see it
point of view, or know what
do.
Ordinarily, the broker and
the title company have
an interest in
seeing that
the sale is completed, because
only then do they usually receive
their commissions. So,
their interests
may
differ
from yours.
7)Whether you retain a lawyer is up to you. It is your decision. The purpose of this notice is to make sure that you have the information needed to make your decision.
SELLER
DATE
BUYER
Listing Broker
Selling Broker
Prepared by:
Name of Real Estate Licensee
New Jersey Realtors® Form 118Statewide 4/17 Page 1 of 13
STATEWIDE NEW JERSEY REALTORS® STANDARD FORM
OF REAL ESTATE SALES CONTRACT
©2016 New Jersey REALTORS®, Inc.
THIS FORM MAY BE USED ONLY IN THE SALE OF A ONE TO FOUR-FAMILY RESIDENTIAL PROPERTY
OR VACANT ONE-FAMILY LOTS. THIS FORM IS SUITABLE FOR USE ONLY WHERE THE SELLER HAS
PREVIOUSLY EXECUTED A WRITTEN LISTING AGREEMENT.
THIS IS A LEGALLY BINDING CONTRACT THAT WILL BECOME FINAL WITHIN THREE BUSINESS DAYS.
DURING THIS PERIOD YOU MAY CHOOSE TO CONSULT AN ATTORNEY WHO CAN REVIEW AND CANCEL THE
CONTRACT. SEE SECTION ON ATTORNEY REVIEW FOR DETAILS.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
1.PARTIES AND PROPERTY DESCRIPTION
2.PURCHASE PRICE
3.MANNER OF PAYMENT
4.SUFFICIENT ASSETS
5.ACCURATE DISCLOSURE OF SELLING PRICE
6.ITEMS INCLUDED IN SALE
7.ITEMS EXCLUDED FROM SALE
8.DATES AND TIMES FOR PERFORMANCE
9..CERTIFICATE OF OCCUPANCY AND ZONING COMPLIANCE
10.MUNICIPAL ASSESSMENTS
11.QUALITY AND INSURABILITY OF TITLE
12.POSSESSION, OCCUPANCY AND TENANCIES
13.LEADBASED PAINT AND/OR LEAD BASED PAINT HAZARD
14.POINT OF ENTRY TREATMENT SYSTEMS
TABLE OF CONTENTS
15.CESSPOOL REQUIREMENTS
16.INSPECTION CONTINGENCY CLAUSE
17.MEGAN'S LAW STATEMENT
18.MEGAN'S LAW REGISTRY
19.NOTIFICATION REGARDING OFF SITE CONDITIONS
20.AIR SAFETY AND ZONING NOTICE
21.BULK SALES
22.NOTICE TO BUYER CONCERNING INSURANCE
23.MAINTENANCE AND CONDITION OF PROPERTY
24.RISK OF LOSS
25.INITIAL AND FINAL WALK THROUGHS
26.ADJUSTMENTS AT CLOSING
27.FAILURE OF BUYER OR SELLER TO CLOSE.
28.CONSUMER INFORMATION STATEMENT ACKNOWLEDGEMENT
29.DECLARATION OF BROKER(S) BUSINESS RELATIONSHIP(S)
30.BROKERS' INFORMATION AND COMMISSION
31..EQUITABLE LIEN
32.DISCLOSURE THAT BUYER OR SELLER IS A REAL ESTATE LICENSEE
33.BROKERS TO RECEIVE CLOSING DISCLOSURE AND OTHER DOCUMENTS
34.PROFESSIONAL REFERRALS
35.ATTORNEYREVIEW CLAUSE
36.NOTICES
37.NO ASSIGNMENT
38.ELECTRONIC SIGNATURES AND DOCUMENTS
39.CORPORATE RESOLUTIONS
40.ENTIRE AGREEMENT; PARTIES LIABLE
41.APPLICABLE LAWS
42.ADDENDA
43ADDITIONAL CONTRACTUAL PROVISIONS
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
1.PARTIES AND PROPERTY DESCRIPTION:
(“Buyer”),
, (“Buyer”),
whose address
is/are
AGREES TO PURCHASE FROM
(“Seller”),
, (“Seller”),
THROUGH THE BROKER(S) NAMED IN THIS CONTRACT AT THE PRICE AND TERMS STATED BELOW, THE
FOLLOWING PROPERTY:
Property Address:
shown on the municipal tax map of
County
as Block
Lot
(the “Property”).
THE WORDS “BUYER” AND “SELLER” INCLUDE ALL BUYERS AND SELLERS LISTED ABOVE.
2.PURCHASE PRICE:
TOTAL PURCHASE PRICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ INITIAL DEPOSIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ADDITIONAL DEPOSIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ MORTGAGE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ BALANCE OF PURCHASE PRICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
New Jersey Realtors® Form 118Statewide 4/17 Page 2 of 13
Buyer's
Seller's
Initials:
513. MANNER OF PAYMENT:
52
(A) INITIAL DEPOSIT to be paid by Buyer to
Participating Broker
Buyer's Attorney
Title Company
53
Other
, on or before
(date) (if left blank, then within five (5)
54business days after the fully signed Contract has been delivered to both Buyer and the Seller).
55
56(B) ADDITIONAL DEPOSIT to be paid by Buyer to the party who will be responsible for holding the escrow who is identified below
57
on or before
(date) (if left blank, then within ten (10) calendar days after the fully signed Contract has been
58delivered to both the Buyer and the Seller).
59
(C) ESCROW: All initial and additional deposit monies paid by
Buyer
shall be held in escrow in the NON-INTEREST
60
61
BEARING TRUST ACCOUNT of
,
(“Escrowee”), until the Closing, at which time all
62
monies shall be paid over to Seller.
The deposit monies
shall not be paid over to Seller prior
to the Closing, unless otherwise agreed
63
in writing by both Buyer and Seller. If Buyer and Seller
cannot agree
on the disbursement of
these escrow monies, the Escrowee may
64place the deposit monies in Court requesting the Court to resolve the dispute.
65
66(D) IF PERFORMANCE BY BUYER IS CONTINGENT UPON OBTAINING A MORTGAGE:
67
If payment of the purchase price requires
a mortgage loan other
than by
Seller or other than assumption
of Seller's
mortgage,
68
Buyer shall apply for the loan through any
lending institution of Buyer's choice in writing on lender's standard
form within
ten (10)
69
calendar days after the attorneyreview period is completed or, if this Contract is timely disapproved by an attorney as provided in the
70
AttorneyReview Clause Section of this Contract, then within ten (10)
calendar
days after the parties agree to the
terms of this
Contract,
71and use best efforts to obtain it. Buyer shall supply all necessary information and fees required by the proposed lender and shall authorize
72 the lender to communicate with the real estate brokers(s) and involved attorney(s). Buyer shall obtain a written commitment from the
73lending institution to make a loan on the property under the following terms:
75
Principal Amount $
Type of Mortgage:
VA
FHA
Conventional
76
Term of Mortgage:
years, with monthly payments based on a
year payment schedule.
77
The written mortgage commitment must be delivered to Seller's agent, who is the Listing Broker identified in Section 30, and Seller's
78
79
attorney, if applicable, no later than
(date)(if
left blank, then within thirty (30) calendar days after
80
the attorneyreview period is completed,
if
Contract
is timely disapproved by an attorney as provided in the AttorneyReview
81
Clause Section of this Contract, then within
thirty
(30) calendar
days after
the parties agree to the terms of
this Contract). Thereafter,
82
if Buyer has not obtained the commitment, then either Buyer or Seller may void this Contract by written notice to the other party and
83
Broker(s) within ten (10) calendar days
commitment
date
or any
extension
of the commitment
date,
whichever
is
later. If this
84
Contract is voided, the deposit monies paid
by
Buyer shall
be returned
notwithstanding
any
other
provision
this Contract,
85provided, however, if Seller alleges in writing to Escrowee within said ten (10) calendar days of the commitment date or any extension of
86the commitment date, whichever is later, that the failure to obtain the mortgage commitment is the result of Buyer's bad faith, negligence,
87 intentional conduct or failure to diligently pursue the mortgage application, then Escrowee shall not return the deposit monies to Buyer
88without the written authorization of Seller.
89
90(E) BALANCE OF PURCHASE PRICE: The balance of the purchase price shall be paid by Buyer in cash, or by certified, cashier's
91check or trust account check.
92
93Payment of the balance of the purchase price by Buyer shall be made at the closing, which will take place on
94
(date) at the office of Buyer's closing agent or such other place as Seller
95and Buyer may agree (“the Closing”).
96
974. SUFFICIENT ASSETS:
98 Buyer represents that Buyer has or will have as of the Closing, all necessary cash assets, together with the mortgage loan proceeds, to
99complete the Closing. Should Buyer not have sufficient cash assets at the Closing, Buyer will be in breach of this Contract and Seller shall
100be entitled to any remedies as provided by law.
101
1025. ACCURATE DISCLOSURE OF SELLING PRICE:
103Buyer and Seller certify that this Contract accurately reflects the gross sale price as indicated in Section 2 of this Contract. Buyer and
104Seller understand and agree that this information shall be disclosed to the Internal Revenue Service and other governmental agencies as
105required by law.
106
1076. ITEMS INCLUDED IN SALE:
108
The Property includes all fixtures
permanently
attached to the building(s), and all shrubbery, plantings and fencing,
gas and
electric
109
fixtures, cooking ranges and ovens,
hot water
heaters, flooring, screens, storm sashes, shades, blinds, awnings, radiator
covers,
heating
110apparatus and sump pumps, if any, except where owned by tenants, are included in this sale. All of the appliances shall be in working
New Jersey Realtors® Form 118Statewide 4/17 Page 3 of 13
111order as of the Closing. Seller does not guarantee the condition of the appliances after the Deed and affidavit of title have been delivered
112 to Buyer at the Closing. The following items are also specifically included (If reference is made to the MLS Sheet and/or any other
113document, then the document(s) referenced should be attached.):
1187. ITEMS EXCLUDED FROM SALE: (If reference is made to the MLS Sheet and/or any other document, then the document(s)
119referenced should be attached.):
1248. DATES AND TIMES FOR PERFORMANCE:
125Seller and Buyer agree that all dates and times included in this Contract are of the essence. This means that Seller and Buyer must satisfy
126 the terms of this Contract within the time limits that are set in this Contract or will be in default, except as otherwise provided in this
127Contract or required by applicable law, including but not limited to if the Closing has to be delayed either because a lender does not timely
128provide documents through no fault of Buyer or Seller or for three (3) business days because of the change of terms as required by the
129Consumer Financial Protection Bureau.
130
131(A) Additional documents from lenders or other property owners:
132If a lender or other property owner requires that any addendum or other document be signed for a property it owns in connection with this
133Contract, “final execution date,” “acknowledgement date,” or similar language that sets the time period for the completion of any conditions
134or contingencies, including but not limited to inspections and financing, shall mean that the time will begin to run after the attorneyreview
135period is completed or, if this Contract is timely disapproved by an attorney as provided in the AttorneyReview Clause Section of this
136Contract, then from the date the parties agree to the terms of this Contract.
137
1389. CERTIFICATE OF OCCUPANCY AND ZONING COMPLIANCE:
139Seller makes no representations concerning existing zoning ordinances, except that Seller's use of the Property is not presently in violation
140of any zoning ordinances.
141
142Some municipalities may require a Certificate of Occupancy or Housing Code Letter to be issued. If any is required for this Property,
143Seller shall obtain it at Seller's expense and provide to Buyer prior to Closing and shall be responsible to make and pay for any repairs
144
required in order to obtain the Certificate or Letter. However, if this expense exceeds $
(if left blank, then 1.5% of the
145purchase price) to Seller, then Seller may terminate this Contract and refund to Buyer all deposit monies plus Buyer's reasonable expenses,
146if any, in connection with this transaction unless Buyer elects to make repairs in excess of said amount at Buyer's expense, in which event
147Seller shall not have the right to terminate this Contract. In addition, Seller shall comply with all New Jersey laws, and local ordinances,
148including but not limited to smoke detectors, carbon monoxide detectors, fire extinguishers and indoor sprinklers, the cost of which shall
149be paid by Seller and not be considered as a repair cost.
150
10. MUNICIPAL ASSESSMENTS: (Seller represents that Seller
has
has not been notified of any such municipal assessments as
151
152explained in this Section.)
154
Title shall be free and clear of all assessments for municipal improvements, including but not limited to municipal liens, as well as
155
assessments and liabilities for future assessments for improvements constructed and completed. All confirmed assessments and all
156unconfirmed assessments that have been or may be imposed by the municipality for improvements that have been completed as of the
157Closing are to be paid in full by Seller or credited to Buyer at the Closing. A confirmed assessment is a lien against the Property. An
158unconfirmed assessment is a potential lien that, when approved by the appropriate governmental entity, will become a legal claim against
159the Property.
160
16111. QUALITY AND INSURABILITY OF TITLE:
162At the Closing, Seller shall deliver a duly executed Bargain and Sale Deed with Covenant as to Grantor's Acts or other Deed satisfactory
163to Buyer. Title to the Property will be free from all claims or rights of others, except as described in this Section and Section 12, of this
164Contract. The Deed shall contain the full legal description of the Property.
165
This sale will be
subject to utility and other easements and restrictions of record, if any, and such state of facts as an accurate survey
166
167
might disclose, provided such easement or restriction does not
unreasonably limit the use of the Property. Generally, an easement is a
168
right of a person other than the owner of property to use a portion of the property for a special purpose. A restriction is a recorded
169
limitation on the
manner in which a property owner may use
the property. Buyer does not have to complete the purchase, however,
170
if any easement,
restriction or facts disclosed by an accurate
survey would substantially interfere with the use of the Property for
171residential purposes. A violation of any restriction shall not be a reason for Buyer refusing to complete the Closing as long as the title
172company insures Buyer against loss at regular rates. The sale also will be made subject to applicable zoning ordinances, provided that
173the ordinances do not render title unmarketable.
174
New Jersey Realtors® Form 118Statewide 4/17 Page 4 of 13
175
Title
Property
shall
be
good, marketable and insurable,
at regular
rates, by any title insurance company
licensed
to do
business
176
in New Jersey, subject only to the claims and rights described in this section and Section 12. Buyer agrees to order a title insurance
177
(title search)
survey,
required
by Buyer's
lender,
title company
or the
municipality where
Property is located,
178
furnish
copies
to Seller. If Seller's title contains any
exceptions
other than as set forth in this section,
Buyer shall notify Seller
179
Seller
have
thirty (30) calendar days within which
to eliminate those exceptions. Seller represents,
to the best of Seller's
180
knowledge,
there are
no
restrictions
any conveyance or
plans of record that will prohibit use and/or occupancy of the Property
181
as a
family residential dwelling. Seller represents that all buildings and other improvements on the Property are
182
its
boundary
lines and
improvements
on
adjoining
properties
extend
across
lines
Property.
183
If Seller is
unable to
transfer
quality
Seller are
unable
to agree
upon a reduction
of the
184
185price, Buyer shall have the option to either void this Contract, in which case the monies paid by Buyer toward the purchase price shall
186be returned to Buyer, together with the actual costs of the title search and the survey and the mortgage application fees in preparing for
187the Closing without further liability to Seller, or to proceed with the Closing without any reduction of the purchase price.
188
18912. POSSESSION, OCCUPANCY AND TENANCIES:
190(A) Possession and Occupancy.
191Possession and occupancy will be given to Buyer at the Closing. Buyer shall be entitled to possession of the Property, and any rents or
192profits from the Property, immediately upon the delivery of the Deed and the Closing. Seller shall pay off any person with a claim or right
193affecting the Property from the proceeds of this sale at or before the Closing.
194
(B) Tenancies.
Applicable
Not Applicable
195
196
Occupancy will
be subject to the
tenancies listed below as of Closing. Seller represents that the tenancies are not in violation of any
197existing Municipal, County, State or Federal rules, regulations or laws. Seller agrees to transfer all security deposits to Buyer at the Closing
198and to provide to Brokers and Buyer a copy of all leases concerning the tenancies, if any, along with this Contract when it is signed by
199Seller. Seller represents that such leases can be assigned and that Seller will assign said leases, and Buyer agrees to accept title subject to
200these leases.
201
TENANT'S NAME
LOCATION
RENT
SECURITY DEPOSIT
TERM
202
203
204
205
206
207
13. LEAD-BASED
PAINT AND/OR LEAD-BASED PAINT
HAZARD: (This
section is applicable only
to all dwellings
208
209
built prior to 1978.)
Applicable Not Applicable
210(A) Document Acknowledgement.
211Buyer acknowledges receipt of the EPA pamphlet entitled “Protect Your Family From Lead In Your Home.” Moreover, a copy of a
212document entitled “Disclosure of Information and Acknowledgement LeadBased Paint and LeadBased Paint Hazards” has been fully
213completed and signed by Buyer, Seller and Broker(s) and is appended to” and made a part of this Contract.
214
215(B) Lead Warning Statement.
216Every purchaser of any interest in residential real property on which a residential dwelling was built prior to 1978 is notified that such
217property may present exposure to lead from leadbased paint that may place young children at risk of developing lead poisoning. Lead
218 poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced intelligence quotient,
219behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The seller of any interest
220
in residential real property is required to provide the buyer with any information on leadbased paint hazards from risk assessments or
221
inspections in the seller's possession and notify the buyer of any known leadbased paint hazards. A risk assessment or inspection for
222possible leadbased paint hazards is recommended prior to purchase.
223
224(C) Inspection.
225 The law requires that, unless Buyer and Seller agree to a longer or shorter period, Seller must allow Buyer a ten (10) day period
226within which to complete an inspection and/or risk assessment of the Property as set forth in the next paragraph. Buyer, however, has the
227right to waive this requirement in its entirety.
228
229 This Contract is contingent upon an inspection and/or risk assessment (the “Inspection”) of the Property by a certified inspector/risk
230assessor for the presence of leadbased paint and/or leadbased paint hazards. The Inspection shall be ordered and obtained by Buyer at
231Buyer's expense within ten (10) calendar days after the attorneyreview period is completed or, if this Contract is timely disapproved by an
232 attorney as provided in the AttorneyReview Clause Section of this Contract, then within ten (10) days after the parties agree to
233the terms in this Contract (“Completion Date”). If the Inspection indicates that no leadbased paint or leadbased paint hazard is present
234at the Property, this contingency clause shall be deemed null and void. If the Inspection indicates that leadbased paint or leadbased paint
235hazard is present at the Property, this contingency clause will terminate at the time set forth above unless, within five (5) business days from
236the Completion Date, Buyer delivers a copy of the inspection and/or risk assessment report to Seller and Brokers and (1) advises Seller
237and Brokers, in writing that Buyer is voiding this Contract; or (2) delivers to Seller and Brokers a written amendment (the “Amendment”)
New Jersey Realtors® Form 118Statewide 4/17 Page 5 of 13
238 to this Contract listing the specific existing deficiencies and corrections required by Buyer. The Amendment shall provide that Seller
239agrees to (a) correct the deficiencies; and (b) furnish Buyer with a certification from a certified inspector/risk assessor that the deficiencies
240
have been corrected, before the Closing. Seller shall have
(if left blank, then 3) business days after receipt of the Amendment
241to sign and return it to Buyer or send a written counterproposal to Buyer. If Seller does not sign and return the Amendment or fails to
242
offer a counterproposal, this Contract shall be null and void. If Seller offers a counterproposal, Buyer shall have
(if left
243blank, then 3) business days after receipt of the counterproposal to accept it. If Buyer fails to accept the counterproposal within the time
244limit provided, this Contract shall be null and void.
245
24614. POINT-OF-ENTRY TREATMENT (“POET”) SYSTEMS: Applicable Not Applicable
247A pointofentry treatment (“POET”) system is a type of water treatment system used to remove contaminants from the water entering a
248structure from a potable well, usually through a filtration process. Seller represents that a POET system has been installed to an existing
249well on the Property and the POET system was installed and/or maintained using funds received from the New Jersey Spill Compensation
250Fund Claims Program, N.J.S.A. 58:1023.11, et seq. The Buyer understands that Buyer will not be eligible to receive any such funds for the
251continued maintenance of the POET system. Pursuant to N.J.A.C. 7:1J2.5(c), Seller agrees to notify the Department of Environmental
252Protection within thirty (30) calendar days of executing this Contract that the Property is to be sold.
253
254 15. CESSPOOL REQUIREMENTS: Applicable Not Applicable
255 (This section is applicable if the Property has a cesspool, except in certain limited circumstances set forth in N.J.A.C.
2567:9A-3.16.) Pursuant to New Jersey's Standards for Individual Subsurface Sewage Disposal Systems, N.J.A.C. 7:9A (the “Standards”), if
257this Contract is for the sale of real property at which any cesspool, privy, outhouse, latrine or pit toilet (collectively “Cesspool”) is located,
258 the Cesspool must be abandoned and replaced with an individual subsurface sewage disposal system at or before the time of the real
259property transfer, except in limited circumstances.
260
(A) Seller represents to Buyer that
no Cesspool is located at or on the Property, or
one or more Cesspools are located at or on the
261
262Property. [If there are one or more Cesspools, then also check EITHER Box 1 or 2 below.]
263
1.
Seller agrees that, prior to the Closing and at its sole cost and expense, Seller shall abandon and replace any and all Cesspools
264
265located at or on the Property and replace such Cesspools with an individual subsurface sewage disposal system (“System”) meeting all
266 the requirements of the Standards. At or prior to the Closing, Seller shall deliver to Buyer a certificate of compliance (“Certificate of
267Compliance”) issued by the administrative authority (“Administrative Authority”) (as those terms are defined in N.J.A.C. 7:9A2.1) with
268
respect to the System. Notwithstanding
the foregoing,
the Administrative Authority
determines that a fully compliant system cannot
269
be installed at the Property, then Seller shall notify Buyer in writing within three (3) business
days of
its receipt of
the Administrative
270
Authority's determination of its intent
to install either
a
nonconforming System or
a permanent
holding tank,
as determined by the
271Administrative Authority ( “Alternate System”), and Buyer shall then have the right to void this Contract by notifying Seller in writing
272
within seven (7) business days of receipt of the notice from Seller. If
Buyer fails to timely void
this Contract, Buyer
have waived its
273
right to cancel this Contract under this paragraph, and Seller shall
install the Alternate System
and, at or prior to
Closing, deliver
274to Buyer such Certificate of Compliance or other evidence of approval of the Alternate System as may be issued by the Administrative
275Authority. The delivery of said Certificate of Compliance or other evidence of approval shall be a condition precedent to the Closing; or
276
2.
Buyer agrees that, at its sole cost and expense, Buyer shall take all actions necessary to abandon and replace any and all Cesspools
277
278located at or on the Property and replace such Cesspools with a System meeting all the requirements of the Standards or an Alternate
279System. Buyer shall indemnify and hold Seller harmless for any and all costs, damages, claims, fines, penalties and assessments (including
280but not limited to reasonable attorneys' and experts' fees) arising from Buyer's violation of this paragraph. This paragraph shall survive
281the Closing.
282
283(B) If prior to the Closing, either Buyer or Seller becomes aware of any Cesspool at or on the Property that was not disclosed by Seller
284at or prior to execution of this Contract, the party with knowledge of the newly identified Cesspool shall promptly, but in no event later
285than three (3) business days after receipt of such knowledge, advise the other party of the newly identified Cesspool in writing. In such
286event, the parties in good faith shall agree, no later than seven (7) business days after sending or receiving the written notice of the newly
287identified Cesspool, or the day preceding the scheduled Closing, whichever is sooner, to proceed pursuant to subsection (A) 1 or 2 above
288or such other agreement as satisfies the Standards, or either party may terminate this Contract.
289
29016. INSPECTION CONTINGENCY CLAUSE:
291(A) Responsibilities of Home Ownership.
292Buyer and Seller acknowledge and agree that, because the purchase of a home is one of the most significant investments a person can
293 make in a lifetime, all aspects of this transaction require considerable analysis and investigation by Buyer before closing title to the
294Property. While Brokers and salespersons who are involved in this transaction are trained as licensees under the New Jersey Licensing Act
295they readily acknowledge that they have had no special training or experience with respect to the complexities pertaining to the multitude
296 of structural, topographical and environmental components of this Property. For example, and not by way of limitation, Brokers and
297salespersons have no special training, knowledge or experience with regard to discovering and/or evaluating physical defects, including
New Jersey Realtors® Form 118Statewide 4/17 Page 6 of 13
298 structural defects, roof, basement, mechanical equipment, such as heating, air conditioning, and electrical systems, sewage, plumbing,
299exterior drainage, termite, and other types of insect infestation or damage caused by such infestation. Moreover, Brokers and salespersons
300similarly have no special training, knowledge or experience with regard to evaluation of possible environmental conditions which might
301 affect the Property pertaining to the dwelling, such as the existence of radon gas, formaldehyde gas, airborne asbestos fibers, toxic
302chemicals, underground storage tanks, lead, mold or other pollutants in the soil, air or water.
303
304(B) Radon Testing, Reports and Mitigation.
305
(Radon
a radioactive gas which results from the natural breakdown
of uranium in soil, rock and water.
It has been
306
found
homes all over the United States and is a carcinogen. For
more information on radon, go to
www.epa.gov/
307radon/pubs/citguide.html and www.nj.gov/dep/rpp/radon or call the NJ Radon Hot Line at 800-648-0394 or 609-984- 5425.)
308
309If the Property has been tested for radon prior to the date of this Contract, Seller agrees to provide to Buyer, at the time of the execution
310of this Contract, a copy of the result of the radon test(s) and evidence of any subsequent radon mitigation or treatment of the Property.
311In any event, Buyer shall have the right to conduct a radon inspection/test as provided and subject to the conditions set forth in paragraph
312(D) below. If any test results furnished or obtained by Buyer indicate a concentration level of 4 picocuries per liter (4.0 pCi/L) or more in
313the subject dwelling, Buyer shall then have the right to void this Contract by notifying Seller in writing within seven (7) business days of the
314receipt of any such report. For the purposes of this Section 16, Seller and Buyer agree that, in the event a radon gas concentration level
315in the subject dwelling is determined to be less than 4 picocuries per liter (4.0 pCi/L) without any remediation, such level of radon gas
316concentration shall be deemed to be an acceptable level (“Acceptable Level”) for the purposes of this Contract. Under those circumstances,
317Seller shall be under no obligation to remediate, and this contingency clause as it relates to radon shall be deemed fully satisfied.
318
319If Buyer's qualified inspector reports that the radon gas concentration level in the subject dwelling is four picocuries per liter (4.0 pCi/L)
320 or more, Seller shall have a seven (7) business day period after receipt of such report to notify Buyer in writing that Seller agrees to
321remediate the gas concentration to an Acceptable Level (unless Buyer has voided this Contract as provided in the preceding paragraph).
322Upon such remediation, the contingency in this Contract which relates to radon shall be deemed fully satisfied. If Seller fails to notify
323Buyer of Seller's agreement to so remediate, such failure to so notify shall be deemed to be a refusal by Seller to remediate the radon level
324to an Acceptable Level, and Buyer shall then have the right to void this Contract by notifying Seller in writing within seven (7) calendar
325 days thereafter. If Buyer fails to void this Contract within the seven (7) day period, Buyer shall have waived Buyer's right to cancel
326this Contract and this Contract shall remain in full force and effect, and Seller shall be under no obligation to remediate the radon gas
327concentration. If Seller agrees to remediate the radon to an Acceptable Level, such remediation and associated testing shall be completed
328by Seller prior to the Closing.
329
330(C) Infestation and/or Damage By Wood Boring Insects.
331 Buyer, shall have the right to have the Property inspected by a licensed exterminating company of Buyer's choice, for the purpose of
332determining if the Property is free from infestation and damage from termites or other wood destroying insects. If Buyer chooses to make
333this inspection, Buyer shall pay for the inspection unless Buyer's lender prohibits Buyer from paying, in which case Seller shall pay. The
334
inspection must be completed and written reports must be furnished to Seller and Broker(s) within
(if left blank, then 14) calendar
335days after the attorneyreview period is completed or, if this Contract is timely disapproved by an attorney as provided in the Attorney
336
Review Clause Section of this Contract, then within
(if left blank, then 14) calendar days after the parties agree to the terms of this
337Contract. This report shall state the nature and extent of any infestation and/or damage and the full cost of treatment for any infestation.
338Seller agrees to treat any infestation and cure any damage at Seller's expense prior to Closing, provided however, if the cost to cure exceeds
339
1% of the purchase price of the Property, then either party may void this Contract provided they do so within
(if left blank, then 7)
340business days after the report has been delivered to Seller and Brokers. If Buyer and Seller are unable to agree upon who will pay for the
341cost to cure and neither party timely voids this Contract, then Buyer will be deemed to have waived its right to terminate this Contract
342and will bear the cost to cure that is over 1% of the purchase price, with Seller bearing the cost that is under 1% of the purchase price.
343
344(D) Buyer's Right to Inspections.
345Buyer acknowledges that the Property is being sold in an “as is” condition and that this Contract is entered into based upon the knowledge
346of Buyer as to the value of the land and whatever buildings are upon the Property, and not on any representation made by Seller, Brokers
347or their agents as to character or quality of the Property. Therefore, Buyer, at Buyer's sole cost and expense, is granted the right to have
348the dwelling and all other aspects of the Property, inspected and evaluated by “qualified inspectors” (as the term is defined in subsection
349 G below) for the purpose of determining the existence of any physical defects or environmental conditions such as outlined above. If
350Buyer chooses to make inspections referred to in this paragraph, such inspections must be completed, and written reports including a list
351
of repairs Buyer is requesting must be furnished to Seller and Brokers within
(if left blank, then 14) calendar days after the attorney
352review period is completed or, if this Contract is timely disapproved by an attorney as provided in the AttorneyReview Clause Section
353
of this Contract, then within
(if left blank, then 14) calendar days after the parties agree to the terms of this Contract. If Buyer fails
354
to furnish such written reports
Seller and Brokers within the
(if left blank, then 14) calendar days specified in this paragraph,
355this contingency clause shall be deemed waived by Buyer, and the Property shall be deemed acceptable by Buyer. The time period for
356furnishing the inspection reports is referred to as the “Inspection Time Period.” Seller shall have all utilities in service for inspections.
357
New Jersey Realtors® Form 118Statewide 4/17 Page 7 of 13
358(E) Responsibility to Cure.
359If any physical defects or environmental conditions (other than radon or woodboring insects) are reported by the qualified inspectors to
360Seller within the Inspection Time Period, Seller shall then have seven (7) business days after the receipt of such reports to notify Buyer
361in writing that Seller shall correct or cure any of the defects set forth in such reports. If Seller fails to notify Buyer of Seller's agreement
362to so cure and correct, such failure to so notify shall be deemed to be a refusal by Seller to cure or correct such defects. If Seller fails to
363 agree to cure or correct such defects within the seven (7) business day period, or if the environmental condition at the Property (other
364than radon) is incurable and is of such significance as to unreasonably endanger the health of Buyer, Buyer shall then have the right to
365void this Contract by notifying Seller in writing within seven (7) business days thereafter. If Buyer fails to void this Contract within the
366seven (7) business day period, Buyer shall have waived Buyer's right to cancel this Contract and this Contract shall remain in full force,
367and Seller shall be under no obligation to correct or cure any of the defects set forth in the inspections. If Seller agrees to correct or cure
368such defects, all such repair work shall be completed by Seller prior to the closing of title. Radon at the Property shall be governed by
369the provisions of Paragraph (B), above.
370
371(F) Flood Hazard Area (if applicable).
372The federal and state governments have designated certain areas as flood areas. If the Property is located in a flood area, the use of the
373Property may be limited. If Buyer's inquiry reveals that the Property is in a flood area, Buyer may cancel this Contract within ten (10)
374calendar days after the attorneyreview period is completed or, if this Contract is timely disapproved by an attorney as provided in the
375AttorneyReview Clause Section of this Contract, then within ten (10) calendar days after the parties agree to the terms of this Contract.
376If the mortgage lender requires flood insurance, then Buyer shall be responsible for obtaining such insurance on the Property. For a flood
377policy to be in effect immediately, there must be a loan closing. There is a (30) calendar day wait for flood policies to be in effect for
378cash transactions. Therefore, cash buyers are advised to make application and make advance payment for a flood policy at least thirty
379(30) calendar days in advance of closing if they want coverage to be in effect upon transfer of title.
380
Buyer's mortgage lender may require Buyer
to purchase flood insurance in connection with Buyer's purchase of this Property. The
381
382
National Flood Insurance Program (“NFIP”) provides for the availability of flood insurance but also establishes flood insurance policy
383
premiums based on the risk of flooding in
the area where properties
are located. Due to
amendments to federal law governing
384
NFIP, those premiums are increasing and, in
some cases, will rise by
a substantial amount
over the premiums previously charged
for
385flood insurance for the Property. As a result, Buyer should not rely on the premiums paid for flood insurance on this Property previously
386as an indication of the premiums that will apply after Buyer completes the purchase. In considering Buyer's purchase of this Property,
387Buyer is therefore urged to consult with one or more carriers of flood insurance for a better understanding of flood insurance coverage,
388the premiums that are likely to be required to purchase such insurance and any available information about how those premiums may
389increase in the future.
390
391(G) Qualifications of Inspectors.
392Where the term “qualified inspectors” is used in this Contract, it is intended to refer to persons or businesses that are licensed or certified
393by the State of New Jersey for such purpose.
394
39517. MEGAN'S LAW STATEMENT:
396Under New Jersey law, the county prosecutor determines whether and how to provide notice of the presence of convicted sex offenders
397in an area. In their professional capacity, real estate licensees are not entitled to notification by the county prosecutor under Megan's Law
398and are unable to obtain such information for you. Upon closing, the county prosecutor may be contacted for such further information
399as may be disclosable to you.
400
40118. MEGAN'S LAW REGISTRY:
402Buyer is notified that New Jersey law establishes an Internet Registry of Sex Offenders that may be accessed at www.njsp.org. Neither
403Seller or any real estate broker or salesperson make any representation as to the accuracy of the registry.
404
40519. NOTIFICATION REGARDING OFF-SITE CONDITIONS: (Applicable to all resale transactions.)
406Pursuant to the New Residential Construction OffSite Conditions Disclosure Act, N.J.S.A. 46:3C1, et. seq, the clerks of municipalities
407
in New Jersey maintains lists of
offsite conditions which may affect the value
of residential properties in the vicinity of the offsite
408
condition. Buyers may examine
the lists and are encouraged to independently
investigate the area surrounding this property in order
409to become familiar with any offsite conditions which may affect the value of the property. In cases where a property is located near the
410border of a municipality, buyers may wish to also examine the list maintained by the neighboring municipality.
411
41220 AIR SAFETY AND ZONING NOTICE:
413Any person who sells or transfers a property that is in an airport safety zone as set forth in the New Jersey Air Safety and Zoning Act of
4141983, N.J.S.A. 6:180, et seq., and appearing on a municipal map used for tax purposes as well as Seller's agent, shall provide notice to
415a prospective buyer that the property is located in an airport safety zone prior to the signing of the contract of sale. The Air Safety and
416
Zoning Act also requires that each municipality in an airport safety zone
enact an ordinance
or ordinances incorporating the standards
417
promulgated under the Act and providing
for their enforcement within
the delineated areas
in the municipality. Buyer acknowledges
New Jersey Realtors® Form 118Statewide 4/17
Page 8 of 13
418 receipt of the following list of airports and the municipalities that may be affected by them and that Buyer has the responsibility to
419contact the municipal clerk of any affected municipality concerning any ordinance that may affect the Property.
421
Municipality
Airport(s)
422
Alexandria Tp.
Alexandria & Sky Manor
Manalapan Tp. (Monmouth Cty.)
Old Bridge
423
Andover Tp.
AeroflexAndover & Newton
Mansfield Tp.
Hackettstown
424
Bedminister Tp.
Somerset
Manville Bor.
Central Jersey Regional
425
Berkeley Tp.
Ocean County
Medford Tp.
Flying W
426
Berlin Bor.
Camden County
Middle Tp.
Cape May County
427
Blairstown Tp.
Blairstown
Millville
Millville Municipal
428
Branchburg Tp.
Monroe Tp. (Gloucester Cty.)
Cross Keys & Southern Cross
429
Buena Bor. (Atlantic Cty.)
VinelandDowntown
Monroe Tp. (Middlesex Cty.)
430
Dennis Tp.
Woodbine Municipal
Montgomery Tp.
Princeton
431
Eagleswood Tp.
Eagles Nest
Ocean City
432
Ewing Tp.
TrentonMercer County
Old Bridge Tp.
433
E. Hanover Tp.
Morristown Municipal
Oldsman Tp.
Oldmans
434
Florham Park Bor.
Pemberton Tp.
Pemberton
435
Franklin Tp. (Gloucester Cty.)
Southern Cross & Vineland Downtown
Pequannock Tp.
Lincoln Park
436
Franklin Tp. (Hunterdon Cty.)
Sky Manor
Readington Tp.
SolbergHunterdon
437
Franklin Tp. (Somerset Cty.)
Rocky Hill Boro.
438
Green Tp.
Trinca
Southampton Tp.
Red Lion
439
Hammonton Bor.
Hammonton Municipal
Springfield Tp.
Red Wing
440
Hanover Tp.
Upper Deerfield Tp.
Bucks
441
Hillsborough Tp.
Vineland City
Kroelinger & Vineland Downtown
442
Hopewell Tp. (Mercer Cty.)
Wall Tp.
Monmouth Executive
443
Howell Tp.
Wantage Tp.
Sussex
444
Lacey Tp.
Robbinsville
TrentonRobbinsville
445
Lakewood Tp.
Lakewood
West Milford Tp.
Greenwood Lake
446
Lincoln Park Bor.
Winslow Tp.
447
Lower Tp.
Woodbine Bor.
448
Lumberton Tp.
Flying W & South Jersey Regional
449
450The following airports are not subject to the Airport Safety and Zoning Act because they are subject to federal regulation or within the
451jurisdiction of the Port of Authority of New York and New Jersey and therefore are not regulated by New Jersey: Essex County Airport,
452Linden Airport, Newark Liberty Airport, Teterboro Airport, Little Ferry Seaplane Base, Atlantic City International Airport, and
453Maguire Airforce Base and NAEC Lakehurst.
454
45521. BULK SALES:
456 The New Jersey Bulk Sales Law, N.J.S.A. 54:5038, (the “Law”) applies to the sale of certain residential property. Under the Law,
457Buyer may be liable for taxes owed by Seller if the Law applies and Buyer does not deliver to the Director of the New Jersey Division
458 of Taxation (the “Division”) a copy of this Contract and a notice on a form required by the Division (the “Tax Form”) at least ten
459(10) business days prior to the Closing. If Buyer decides to deliver the Tax Form to the Division, Seller shall cooperate with Buyer by
460 promptly providing Buyer with any information that Buyer needs to complete and deliver the Tax Form in a timely manner. Buyer
461promptly shall deliver to Seller a copy of any notice that Buyer receives from the Division in response to the Tax Form.
462
The Law
does not
apply
the sale of a simple dwelling
house, or the sale or lease of a seasonal rental property, if Seller is
an
463
464
individual,
estate or
trust.
A
simple dwelling house is a one
or two family residential building, or a cooperative or condominium
unit
465used as a residential dwelling, none of which has any commercial property. A seasonal rental property is a time share, or a dwelling unit
466 that is rented for residential purposes for a term of not more than 125 consecutive days, by an owner that has a permanent residence
467elsewhere.
469 If, prior to the Closing, the Division notifies Buyer to withhold an amount (the “Tax Amount”) from the purchase price proceeds for
470possible unpaid tax liabilities of Seller, Buyer's attorney or Buyer's title insurance company (the “Escrow Agent”) shall withhold the Tax
471 Amount from the closing proceeds and place that amount in escrow (the “Tax Escrow”). If the Tax Amount exceeds the amount of
472available closing proceeds, Seller shall bring the deficiency to the Closing and the deficiency shall be added to the Tax Escrow. If the
473Division directs the Escrow Agent or Buyer to remit funds from the Tax Escrow to the Division or some other entity, the Escrow Agent
474or Buyer shall do so. The Escrow Agent or Buyer shall only release the Tax Escrow, or the remaining balance thereof, to Seller (or as
475otherwise directed by the Division) upon receipt of written notice from the Division that it can be released, and that no liability will be
476asserted under the Law against Buyer.
477
New Jersey Realtors® Form 118Statewide 4/17 Page 9 of 13
47822. NOTICE TO BUYER CONCERNING INSURANCE:
479Buyer should obtain appropriate casualty and liability insurance for the Property. Buyer's mortgage lender will require that such insurance
480be in place at Closing. Occasionally, there are issues and delays in obtaining insurance. Be advised that a “binder” is only a temporary
481commitment to provide insurance coverage and is not an insurance policy. Buyer is therefore urged to contact a licensed insurance agent
482or broker to assist Buyer in satisfying Buyer's insurance requirements.
483
48423. MAINTENANCE AND CONDITION OF PROPERTY:
485Seller agrees to maintain the grounds, buildings and improvements, in good condition, subject to ordinary wear and tear. The premises
486shall be in “broom clean” condition and free of debris as of the Closing. Seller represents that all electrical, plumbing, heating and air
487conditioning systems (if applicable), together with all fixtures included within the terms of the Contract now work and shall be in proper
488working order at the Closing. Seller further states, that to the best of Seller's knowledge, there are currently no leaks or seepage in the
489roof, walls or basement. Seller does not guarantee the continuing condition of the premises as set forth in this Section after the Closing.
490
49124. RISK OF LOSS:
492 The risk of loss or damage to the Property by fire or otherwise, except ordinary wear and tear, is the responsibility of Seller until
493the Closing.
49525. INITIAL AND FINAL WALK-THROUGHS:
496
In addition
the inspections set forth elsewhere in this
Contract, Seller agrees to permit Buyer or Buyer's duly authorized
497
representative
conduct an initial and a final walkthrough
inspection of the interior and exterior of the Property at any reasonable
498time before the Closing. Seller shall have all utilities in service for the inspections.
499
50026. ADJUSTMENTS AT CLOSING:
501Seller shall pay for the preparation of the Deed, realty transfer fee, lien discharge fees, if any, and onehalf of the title company charges
502 for disbursements and attendance allowed by the Commissioner of Insurance; but all searches, title insurance premium and other
503conveyancing expenses are to be paid for by Buyer.
504
505Seller and Buyer shall make prorated adjustments at Closing for items which have been paid by Seller or are due from Seller, such as real
506estate taxes, water and sewer charges that could be claims against the Property, rental and security deposits, association and condominium
507dues, and fuel in Seller's tank. Adjustments of fuel shall be based upon physical inventory and pricing by Seller's supplier. Such determi
508nation shall be conclusive.
509
510If Buyer is assuming Seller's mortgage loan, Buyer shall credit Seller for all monies, such as real estate taxes and insurance premiums paid
511in advance or on deposit with Seller's mortgage lender. Buyer shall receive a credit for monies, which Seller owes to Seller's Mortgage
512lender, such as current interest or a deficit in the mortgage escrow account.
513
514If the Property is used or enjoyed by not more than four families and the purchase price exceeds $1,000,000, then pursuant to N.J.S.A.
51546:157.2, Buyer will be solely responsible for payment of the fee due for the transfer of the Property, which is the socalled “Mansion
516“Tax, in the amount of one (1%) percent of the purchase price.
517
518 Unless an exemption applies, nonresident individuals, estates, or trusts that sell or transfer real property in New Jersey are required to
519make an estimated gross income tax payment to the State of New Jersey on the gain from a transfer/sale of real property (the socalled
520“Exit Tax,”) as a condition of the recording of the deed.
521
522 If Seller is a foreign person (an individual, corporation or entity that is a nonUS resident) under the Foreign Investment in Real 523 Property Tax Act of 1980, as amended (“FIRPTA”), then with a few exceptions, a portion of the proceeds of sale may need to be
524withheld from Seller and paid to the Internal Revenue Service as an advance payment against Seller's tax liability.
525
526Seller agrees that, if applicable, Seller will (a) be solely responsible for payment of any state or federal income tax withholding amount(s)
527
required by
law to be
paid
by Seller (which Buyer may deduct from the purchase price
and pay at the Closing); and (b)
execute
528
and deliver
to Buyer at
Closing any and all forms, affidavits or certifications required
under state and federal law to be
filed in
529connection with the amount(s) withheld.
530
531There shall be no adjustment on any Homestead Rebate due or to become due.
532
53327. FAILURE OF BUYER OR SELLER TO CLOSE:
534
If
Seller fails to close title to the Property in accordance
with this Contract, Buyer then may commence
any legal or equitable action
535
which Buyer may be entitled. If Buyer fails to close
title in accordance with this Contract, Seller then may commence an action
536
damages it has suffered, and, in such case, the deposit
monies paid on account of the purchase price
shall be applied against such
537damages. If Buyer or Seller breach this Contract, the breaching party will nevertheless be liable to Brokers for the commissions in the
New Jersey Realtors® Form 118Statewide 4/17 Page 10 of 13
After receiving the New Jersey 118 form, it is crucial to proceed with care and diligence. This form is a legally binding contract that becomes final within three business days unless canceled by an attorney during the review period. Filling out this form accurately is essential for both buyers and sellers in the transaction of a one to four-family residential property or vacant one-family lots. Below are the necessary steps to complete the form thoroughly.
Once all sections are filled out and the form is duly signed and dated, it is critical to adhere to the timelines and requirements specified in the form to ensure a smooth transaction. The signed contract will guide the next steps of the property sale, leading towards the closing process.
What is the New Jersey 118 form?
The New Jersey 118 form is a standard real estate sales contract distributed by the New Jersey Realtors® association. It is specifically designed for the sale of one to four-family residential properties or vacant one-family lots that have a previously executed written listing agreement. This legally binding contract outlines the agreement between the buyer and seller regarding the terms of the sale, including the purchase price, payment manner, and other important conditions.
Who needs to read the New Jersey 118 form?
Both the buyer and seller involved in the transaction of selling or purchasing a one to four-family residential property or a vacant one-family lot in New Jersey need to read the form. It is also advisable for real estate brokers representing either party to be familiar with the content of this form.
Do I need legal representation to understand or fill out this form?
While the form expressly states that neither the real estate broker nor anyone from the title company can provide legal advice, it highly recommends that each party - buyer and seller - have their own lawyer. A lawyer can review the contract, help understand its terms, negotiate amendments, and represent you in legal matters related to the transaction, including closing.
Is it mandatory to hire a lawyer when signing the NJ 118 form?
Hiring a lawyer is not mandatory but strongly advised. The notice within the form emphasizes the importance of legal representation in reviewing the contract, negotiating its terms, and handling any legal challenges or obligations. Without a lawyer, you will not have legal representation in these matters.
Can the contract be changed or cancelled after signing?
Yes, but only under specific conditions. The contract becomes final and binding unless cancelled by a lawyer within three business days after signing. If you do not have a lawyer, the contract cannot be changed or cancelled unless the other party agrees. Real estate brokers and the title insurance company cannot change the contract.
What risks does a buyer face without a lawyer?
A buyer without legal representation faces several special risks, such as inability to properly address problems that may arise concerning the property's title, size, shape, or other issues affecting the property's value. The interests of the broker and title company may not align with the buyer's, as their primary goal could be to complete the sale to earn their commissions.
Are surveys and reports necessary, and who orders them?
Surveys, title reports, and other important reports are crucial for understanding the condition and ownership of the property. A lawyer can order these documents, review them, help resolve any arising questions, and prepare the necessary documents for closing. These reports can be costly, but they are an essential part of due diligence before finalizing the transaction.
What happens if there are problems with the seller's title or the property?
If there are problems with the seller's title or issues related to the property that affect its value, only a lawyer can advise on the appropriate course of action. The real estate broker or title company should notify you of known problems, but they may not fully understand or address the issue from your perspective.
Is there a provision for attorney review in the New Jersey 118 form?
Yes, the contract includes a provision for attorney review. It specifies that the contract will become final within three business days unless a lawyer disapproves it during that time. This period allows for legal review and negotiation of the contract terms to protect your interests.
Not consulting a lawyer for legal advice and review of the contract: The notice clearly states that the real estate broker or the title company will not provide legal advice to either the buyer or the seller. It is a common mistake for parties to overlook the need for legal representation. Having a lawyer could significantly impact the understanding and negotiation of the terms of the contract, as well as the handling of any legal issues that arise during the purchase or sale process.
Failing to understand the binding nature of the contract: As indicated, the contract becomes final and binding unless a lawyer cancels it within three business days. Many individuals fail to comprehend the seriousness of this provision and do not take the necessary steps to have the contract reviewed promptly by a lawyer, if at all. This lack of action can lead to being bound to a contract that may not be in their best interest.
Underestimating the importance of a title and other important reports: The document highlights the role of a lawyer in ordering a survey, title report, or other important reports to resolve any issues regarding the ownership and condition of the property. People often overlook these aspects of the transaction, failing to realize that these reports can uncover potential problems that could affect the value or usability of the property.
Ignoring the risks of not having a lawyer when problems arise: The notice delineates the specific risks a buyer without legal representation faces, especially if issues arise concerning the property's title, dimensions, or other matters affecting its value. Some people proceed without legal advice, falsely believing that the broker or title company will manage these problems, not recognizing that these entities have a financial interest in the completion of the sale and may not prioritize the buyer's or seller's best interests.
These mistakes underscore the importance of being fully informed and seeking appropriate legal counsel when engaging in real estate transactions to protect one's interests fully.
Real estate transactions involve a considerable amount of paperwork to ensure the legal transfer of property and to record agreements between the parties involved. When dealing with residential property sales in New Jersey, the New Jersey 118 form serves as a crucial document. However, to smoothly navigate through the process, several other forms and documents often complement its use. Understanding these documents provides clarity and security, ensuring all legal and contractual aspects of the transaction are covered comprehensively.
In the realm of real estate, these documents serve as the backbone of a sale or purchase, ensuring all parties are well-informed and legally protected. By understanding and properly utilizing these forms and documents, individuals involved in a real estate transaction can achieve a smoother, more secure process. From setting clear expectations to meeting legal requirements, each document plays a vital role in the successful transfer of property ownership.
The California Residential Purchase Agreement (RPA) is similar to the New Jersey 118 form. Like the NJ 118, the California RPA outlines the terms and conditions under which a residential property will be sold, including identification of the buyer and seller, purchase price, deposits, closing date, and disclosures. It also emphasizes the importance of understanding the contract before signing and encourages consulting with a lawyer for any legal advice.
The Florida "AS IS" Residential Contract For Sale And Purchase mirrors the NJ 118 in several ways. Both documents include sections on the roles of real estate brokers, the necessity for legal counsel, the binding nature of the contract upon signature, property inspections, and disclosure related to the condition of the property. They both stress that if buyers proceed without an attorney, they assume the risk of not fully understanding their legal rights and obligations.
The Residential Real Estate Purchase Agreement used in Texas shares similarities with the New Jersey 118 form as well. This form includes comprehensive details about the transaction, such as parties' information, legal description of the property, purchase price, financing details, closing and possession, as well as advisories regarding legal and tax advice. The emphasis on having legal representation to comprehensively review the contract aligns closely with the cautions provided in the NJ 118 form.
Illinois Residential Real Estate Contract 7.0 parallels the New Jersey 118 form in its structure and content. It lays out the framework for the sale of residential property, including identification of buyer and seller, real estate broker information, financial terms, and closing details. It also underscores the significance of legal representation in the transaction process to ensure that parties fully understand their rights and commitments. Additionally, both forms include provisions regarding inspections and disclosures pertaining to the property's condition.
The Washington State Residential Real Estate Purchase and Sale Agreement is akin to the New Jersey 118 form. It provides a detailed outline of the transaction process, including terms of sale, identification of the parties, descriptions of the property, financial arrangements, and closing details. Similar to the NJ 118 form, it advises buyers and sellers about the importance of seeking legal counsel to navigate the legal aspects of the real estate transaction, emphasizing that real estate brokers are unable to provide legal advice.
When filling out the New Jersey 118 form, individuals involved in the transaction should keep the following guidelines in mind to ensure accuracy and compliance:
By following these guidelines, buyers and sellers can better protect their interests and facilitate a smoother real estate transaction.
The New Jersey 118 form, a crucial document in real estate transactions within the state, is often misunderstood by both buyers and sellers. Clarifying these misconceptions can facilitate smoother transactions and better informed parties. Here are ten common misconceptions about the New Jersey 118 form:
These points highlight the complexity of the New Jersey 118 form and underscore the importance of obtaining professional guidance. Engaging with the document’s details can significantly affect both parties in a real estate transaction, emphasizing careful reading and understanding.
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