Paragraph 6C | One to Four Family Residential Contract
What are my client’s obligations under the contract when it comes to surveys? Which section applies if my client has an existing survey and which section applies if my client does not? These are among some of the most common questions we receive from agents.
The requirements for property surveys are spelled out in Paragraph 6C of the One to Four Family Residential Contract (Resale). Let’s dive a little deeper into what this section in the contract provides:
Paragraph 6C requires that the survey be prepared by a registered professional land surveyor acceptable to the Title Company and the Buyer’s lender(s). If your client is required to provide the survey, you should make sure the survey meets these requirements.
Paragraph 6C (1) – Seller has an Existing Survey
Paragraph 6C (1) should be used when the Seller has an existing survey of the property. Before selecting Paragraph 6C (1), the Seller’s agent should make certain that the Seller has an existing survey. Subparagraph (1) provides that the Seller agrees to provide a copy of the existing survey and a T-47 Residential Real Property Affidavit (T-47 Affidavit) to the Buyer and Title Company within the time specified in the contract. If either document is not delivered, the contract specifies in bold type that the Buyer shall obtain a new survey at Seller’s expense no later than 3 days prior to the Closing Date.
In addition, if the existing survey and T-47 Affidavit are delivered but either or both are unacceptable to the Title Company or the Buyer’s lender(s), the Buyer must obtain a new survey. Note that in this situation, the contract includes checkboxes for the parties to specify who will pay for the new survey.
Paragraph 6C (2) – No Existing Survey and Buyer will Obtain and Pay
Paragraph 6C (2) should be used when the parties are aware that the Seller does not have an existing survey and have agreed that the Buyer will obtain and pay for a survey within an agreed-upon number of days after the Effective Date. Paragraph 6C (2) provides that the Buyer is deemed to have received the survey either on the actual date of receipt or the date that is in the contract, whichever is earlier. Pay particular attention to this timing because the timing impacts the date calculations in Paragraph 6D regarding objections to the title, survey, and exception documents.
Paragraph 6C (3) – No Existing Survey and Seller will Obtain and Pay
Paragraph 6C (3) should be used when the parties are aware that the Seller does not have an existing survey and have agreed that the Seller will obtain and pay for a survey that will be delivered to the Buyer within an agreed-upon number of days after the Effective Date.
Even though Paragraphs 6C (2) and 6C (3) do not expressly state that the survey will be delivered to the Title Company and Buyer’s lender(s), this obligation can be implied from the language in Paragraph 6C. Paragraph 6C specifies that the survey will be delivered to both the Title Company and Buyer’s lender(s).
What Happens if a Party Does not Satisfy the Requirements of Paragraph 6C:
Except where the contract specifically states what happens if an obligation is not performed or deemed to have been performed in Paragraph 6C, if a party does not comply with the requirements of the contract, that party will be in default and the non-defaulting party can exercise the remedies in Paragraph 15 of the contract.
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