🧾 California Residential Purchase Agreement (RPA) – Agent Training Guide California Association of REALTORS® (C.A.R.)

🔹 Section 1: Understanding the RPA

  1. What is the current version of the RPA?
    • Ensure you’re using the latest C.A.R.-approved Residential Purchase Agreement.
  2. Is the RPA required for all residential transactions?
    • Yes, for standard 1–4 unit residential sales using C.A.R. forms.
  3. What are the key updates in the latest version?
    • Review any new disclosures, contingency structures, or format changes.
  4. Is the RPA legally binding once signed?
    • Yes, once all parties have signed and accepted the terms.
  5. What happens if a term is left blank?
    • It may default to a standard time frame or be considered “not applicable”—review form instructions carefully.

🔹 Section 2: Offer Terms & Contract Basics

  1. What is the standard escrow period?
    • Typically 30 days unless otherwise specified.
  2. What is a reasonable earnest money deposit (EMD)?
    • Commonly 1%–3% of the purchase price.
  3. Can a buyer use a personal check for the EMD?
    • Yes, but it must be deposited in escrow by the agreed deadline.
  4. Who holds the deposit?
    • Usually an escrow company, not the agent or broker.
  5. What types of financing are supported?
  • Conventional, FHA, VA, and others—must be clearly stated.

🔹 Section 3: Contingencies & Timelines

  1. How long does the buyer have for inspections?
  • Default is 17 days; can be modified in the agreement.
  1. Can contingencies be extended?
  • Yes, if agreed in writing by both parties.
  1. What happens if contingencies aren’t removed on time?
  • The seller may issue a Notice to Perform.
  1. What is the standard loan contingency period?
  • Typically 17 days.
  1. How is the appraisal contingency handled?
  • Can be included or waived—important for FHA/VA deals.

🔹 Section 4: Property Condition & Disclosures

  1. Is the seller required to complete a TDS?
  • Yes, unless legally exempt (e.g., certain trusts or foreclosures).
  1. Does the seller need to repair anything?
  • Not unless negotiated or required by law (e.g., health/safety).
  1. Who pays for inspections?
  • Negotiable; often the buyer, unless otherwise agreed.
  1. Can the buyer cancel based on the inspection?
  • Yes, if within contingency period.
  1. How are repairs negotiated?
  • Through a Request for Repair (C.A.R. Form RR).

🔹 Section 5: Fees, Credits & Closing Costs

  1. Who pays escrow/title fees?
  • Customary by region but negotiable.
  1. How are city/county transfer taxes handled?
  • Typically split, but must be agreed upon in the RPA.
  1. Can the buyer request seller-paid closing costs?
  • Yes, written into Section 3 or additional terms.
  1. Who provides HOA docs and pays fees?
  • Seller usually provides; payment can be negotiated.
  1. Who pays for NHD report?
  • Commonly the seller, but negotiable.

🔹 Section 6: Legal Clauses & Disputes

  1. What is the mediation clause?
  • Requires good-faith mediation before legal action.
  1. Is arbitration mandatory?
  • No, parties must initial to agree to arbitration.
  1. How is cancellation handled?
  • Through mutual agreement or based on contingency failure.
  1. What is the Liquidated Damages clause?
  • Limits the buyer’s liability to the EMD if breached.
  1. Can a buyer sue the seller after closing?
  • Yes, under certain conditions, particularly for nondisclosure.

🔹 Section 7: Additional Terms & Addenda

  1. Can personal property be included?
  • Yes, must be clearly listed in the agreement.
  1. How are seller credits (e.g., rate buy-downs) written in?
  • Under Section 3 or in Additional Financing Terms.
  1. Can a buyer assign the contract?
  • Generally, no without seller consent.
  1. What are the risks of waiving contingencies?
  • Loss of deposit or inability to cancel if issues arise.

🔹 Section 8: Required Addenda & Documents

  1. What addenda may be required?
  • FHA/VA Addendum, Appraisal Contingency, Solar, ADU, etc.
  1. Do we need to attach proof of funds and preapproval?
  • Yes, it strengthens the offer and is expected.
  1. Is the Buyer Representation Agreement required?
  • Not legally required, but recommended for fiduciary protection.

âś… Tips for Agents:

  • Always review the RPA line-by-line with your clients.
  • Use C.A.R. Quick Guides and updates to stay current.
  • Never leave blanks—fill with “N/A” if not applicable.
  • Use zipForm® and digital signatures for efficiency and compliance.

Disclaimer:
The questions and answers provided are for general guidance only and may not cover all details or apply to every situation. If anything is unclear or you need further clarification, please visit car.org for official resources and the most up-to-date information from the California Association of REALTORS®.