2017 Risk Management Exchange Highlights – Part 2
Part 2 of an abridged 2017 Risk Management Exchange transcription featuring Scott Drucker, Esq. and from the 2017 Risk Management Committee: Evan Fuchs (chair), Holly Eslinger, JT Tsighis and John Mijac.
Fillable Seller’s Property Disclosure Statements
Scott Drucker: Let’s talk about some of the issues we’re dealing with on a state level. I’m going to start with a fillable Seller’s Property Disclosure Statements (SPDS). We’re evaluating our options in that regard. Who would like to talk about the discussions that we’ve had in risk management meetings?
Evan Fuchs: The Arizona Real Estate Agent Forum on Facebook is where a lot of us like to go and share information. Well, there’s an ongoing discussion there about modernizing the way that sellers are able to complete their disclosure statement.
“Why is it that we can’t have a fillable PDF and make it easier? Since Arizona REALTORS® doesn’t have it, I’ve made my own and here it is where other people can use it.” (paraphrased Facebook post)
The problem is that all of our forms are not only protected by copyright, but they’re also protected by end-user license agreements. It’s literally illegal to (create your own), but there are underlying reasons why they’re not fillable PDFs to begin with.
Nevertheless, this conversation comes up, so we put it on the agenda earlier this year. We had an open discussion about modern technology versus the way we’ve done things and why. We’re trying to work through that right now.
John Mijac: With regards to the fillable SPDS, I went into that with, “No, never. Not ever. I don’t want to even consider that.” I was thinking about how it could be abused. However, after listening to some other members of the Risk Management Committee, I realized that there really was a legitimate reason to think about creating some way in which a SPDS could be delivered to a seller, electronically, so that they can fill it out. Since the idea here is that more information is always better.
Scott Drucker: The concern is, we do not want to put agents in a position where they may be tempted to complete portions of the SPDS, or have to prove that they didn’t do so. We’re looking at resources and we’re working with zipForm®.
What we’re trying to do is develop a way, so that we have a locked Seller’s Property Disclosure Statement. That SPDS can only be unlocked when it is sent to one specific email, which is that of the seller. The seller can fill out the document. Once they send it back, it automatically locks again.
That’s what we’re exploring. We also need to be able to establish who this went to, when it went to them, what was completed. Data trails can be manipulated and they expire after a while. We’re still working through some of those technical issues, but we know there is a desire out there for it.
Evan Fuchs: We’re going to discuss it further and it’s my expectation that we’re going to make a decision, one way or another, this year.
Scott Drucker: What other state risk management issues are you dealing with at our meetings?
Holly Eslinger: I’d like to talk about solar. This was an issue that was brought up the year before. We were at that time beginning the process of redoing the purchase contract and the ancillary forms. What we said was, let’s postpone our work on solar until we finished with those forms. A workgroup has been formed, chaired by Laurie McDonnell, to begin work on this new form.
Scott Drucker: Yes, some sort of solar lease/loan addendum. One of the issues that we’ve been talking about is making our transactions, when there are solar leases involved, contingent on that buyer obtaining approval.
There’s got to be action both on behalf of the seller and on behalf of the buyer, right? The seller disclosing the lease, disclosing the contact information, but also contacting the solar company to let them know, “Hey, I’ve got a pending sale. Here’s the name of the buyer and here’s the name of the title company.”
Then we’ve got to have the buyer start filling out that paperwork. We’re trying to put timelines in place, and that’s certainly something that we’re working on.
Next: Purchase Contracts | Prepaids | Service Animals | VRBOs
2017 Risk Management Exchange – Part 1 (Serving on Committees | Social Media | Elder Abuse) Tags: Evan Fuchs, Fillable Seller’s Property Disclosure Statements, Fillable SPDS, Holly Eslinger, John Mijac, JT Tsighis, Risk Management Committee, Risk Management Exchange, Scott Drucker, solar