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Changes to Appraisal Section of 2017 Purchase and Sale Agreement

A revision to forms RF401, RF403, and RF404 was published and released on August 21, 2017. The Tennessee REALTORS® Residential Forms Committee has made the following changes to the appraisal section of the 2017 purchase and sale agreement:

In the new version of the purchase and sale agreement, the Buyer shall promptly notify the Seller if the appraised value of the Property does not equal or exceed the purchase price. After notification, the Buyer has 3 days to either waive the appraisal contingency or terminate the agreement. This language will still allow Buyers and Sellers to negotiate a new purchase price and execute an amendment to the contract within those 3 days if the parties wish to do so.

This is a change from the current requirement that the Buyer must terminate the agreement or waive the contingency within 2 days following Buyer’s receipt of an appraisal where the value does not equal or exceed the purchase price.

This change will appear in the Residential Purchase and Sale Agreement (RF401), The Lot/ Land Purchase and Sale Agreement (RF404), and the New Construction Purchase and Sale Agreement (RF403).

For visual and training purposes, you may download a sample of the updated agreement. If you have any questions regarding the change, please contact the Tennessee REALTORS® Legal and Ethics Hotline at 800.899.5297.


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