Natural Disasters and Real Estate
By JESS BARRON, Lindsey’s Inc. Realtors
What happens if a property that you are buying or selling is destroyed? With the recent tornado that destroyed parts of Newnan, some of you may be wondering this. Hopefully, this is not your current situation.
Most Realtors here use the Georgia Association of Realtor (GAR) Forms for contracts. The purchase and sale agreement specifically has language dedicated to this situation. Section 3C of this form states:
Risk of Damage to Property. Seller warrants that at the time of closing the Property and all items remaining with the Property, if any, will be in substantially the same condition (including conditions disclosed in the Seller’s Property Disclosure Statement or Seller’s Disclosure of Latent Defects and Fixtures Checklist) as of the Offer Date, except for changes made to the condition of Property pursuant to the written agreement of Buyer and Seller. At time of possession, Seller shall deliver Property clean and free of trash, debris, and personal property of Seller not identified as remaining with the Property. Notwithstanding the above, if the Property is destroyed or substantially destroyed prior to closing, Seller shall promptly give notice to Buyer of the same and provide Buyer with whatever information Seller has regarding the availability of insurance and the disposition of any insurance claim. Buyer or Seller may terminate this Agreement without penalty not later than fourteen (14) days from receipt of the above notice. If Buyer or Seller do not terminate this Agreement, Seller shall cause Property to be restored to substantially the same condition as on the Offer Date. The date of closing shall be extended until the earlier of one year from the original date of closing, or seven (7) days from the date that Property has been restored to substantially the same condition as on the Offer Date and a new certificate of occupancy (if required) is issued.
If you are, or know, a Realtor whose home has been damaged by the recent tornado in Newnan, please remember the Georgia Association of Realtors’ Disaster Relief Fund for Realtors:
GAR Disaster Relief Fund
6065 Barfield Road NE
Atlanta, GA 30328
Toll free 866-280-0576 • Fax 678-922-7750