What is the CAR contract when you buy or sell a home? 

What is the CAR contract when you buy or sell a home? 

The CAR contract is the standard form everybody uses. It is signed by the buyer and seller for California home sales.

Click here for an example of a CAR contract. And for good measure, here’s the accompanying estimate of closing costs.

The document is 16-pages long, and it works seamlessly with all the other documents needed for a typical home purchase/sale, such as the disclosures and escrow documents. 

CAR stands for California Association of Realtors, but the CAR contract is also the standard form used for FSBOs (because it is so user-friendly, and it is what 3rd parties like lenders and escrow companies like to see). 

Pretty much everyone likes the CAR contract, myself included, because the terms are standard, straightforward, and balanced fairly between buyer and seller. The form is so easy to use that most of the checkboxes and fields don’t even need any input, because the standard terms are set by default.

Electronic versions of the CAR contract (and related CAR forms) are currently only available to licensed real estate agents and lawyers.  

The CAR contract is updated regularly to match current laws and practices, so it’s good to use the newest version (currently that would be December 2022). 

These are the key provisions in the CAR contract:

  • Seller name
  • Buyer name
  • Address of home being purchased
  • Purchase price
  • Initial Deposit (typical is 1% in a buyer’s market; or 3% in a seller’s market)
  • Loan amount (if any)
  • Buyer contingencies to cancel (standard is 17-days for any investigation, appraisal and loan approval)
  • Close of escrow (typical is 30-days)
  • Escrow company
  • Personal property (typical is appliances included)
  • Closing cost allocation (this is city and county specific)
  • As-Is Sale

Looking for more details on these terms? You can read my blog post here: https://norcalfsbo.com/2015/01/08/the-purchase-contract-part-2/

Or call me anytime for a free consultation: 209-785-8998. I enjoy answering questions.

Greg Glaser, Attorney at Law
I help home buyers & sellers throughout California
209-785-8998 — [email protected]
Flat Fee Packages Available (no commission) for Buyers and Sellers Without a Real Estate Agent
http://www.GregGlaser.com

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