In general, a standard real estate contract is used when an affordable home is sold. This contract will detail terms the buyer and seller agree to.

Buyers work with their agent to create the contract and submit it to the seller within 24 hours of winning the Fair Selection Process. The seller may move to the next person on the list if the offer is not submitted within 24 hours; the seller may allow more than 24 hours, but they are not required to do so.

Even if the contract is submitted the seller within 24 hours, there are several reasons it may be declined. Contracts may be declined if:

  1. The buyer’s offer price is for less than the maximum resale price of the home. If this occurs, the program will ask the seller to counter the offer before moving onto the next person on the list, but sellers are not required to counter, and the counter may be the maximum resale price of the home.
  2. The buyer’s offer has a home sale contingency. This type of contingency is a requirement of the program and means that the buyer needs to sell their current home before they can buy the affordable home. The seller is not required to accept an offer with a home sale contingency.
  3. The contract includes unreasonable terms. The seller must counter these terms before moving to the next household on the list. This counter should be reasonable and in the realm of normally acceptable terms for sales in the program. The program will establish what are normally acceptable terms. Please contact the program if you have questions.

Usually there are 30-45 days between the contract being signed and when the sale closes. The program requires the seller to give the buyer at least 30 days, although the seller and buyer can agree to shorter or longer terms through a joint agreement.

All contracts must include the following text in the “additional provisions” part of the contract:

  • Buyer understands this property is covenant restricted. The City of Boulder Homeownership Program will provide the Buyer with a copy of the Affordable Housing Covenant by the Title Deadline. Buyer has until the Title Objection Deadline to object to the Covenant terms. If Buyer has no objection, it is assumed Buyer agrees to all conditions of such covenant including limitations on resale and occupancy requirements.

This allows buyers the ability to terminate the contract if they do not agree to the Permanently Affordable Covenant.

Once the contract is finalized (fully signed by all parties) a copy needs to be sent to the program.

Frequently Asked Questions

As described above, a contract can be declined if:

  • The contract was not received within 24 hours.
  • The price offered is lower than the maximum resale price.
  • The buyer has a home sale contingency.
  • The contract includes unreasonable terms. The seller must counter these terms before moving to the next household on the list.

If a contract is declined or a Fair Selection Process winner passes on submitting an offer, the seller’s agent will notify the next household on the list, starting a new 24-hour period for the buyer to submit an offer.

Passing on submitting an offer will not impact a household’s chances of winning future Fair Selection Processes as each selection is held independently.

They are very similar. Both use the Colorado Real Estate Commission approved contract. The main difference is that contracts for homes in the program must include the following language in the “additional provisions” part of the contract:

  • Buyer understands this property is covenant restricted. The City of Boulder Homeownership Program will provide the Buyer with a copy of the Affordable Housing Covenant by the Title Deadline. Buyer has until the Title Objection Deadline to object to the Covenant terms. If Buyer has no objection, it is assumed Buyer agrees to all conditions of such covenant including limitations on resale and occupancy requirements.

No, but the program requires the buyer to put $2,000 into the transaction by the time of closing. This could be in the form of earnest money, cash at closing or a combination. The actual earnest money in the contract is negotiable between the buyer and seller but should not exceed $2,000.

Yes. Buyers can offer less but most homes sell for the maximum resale price and sellers do not need to accept a contract for less than the maximum resale price. If a buyer offers less, the seller can move to the next household in the Fair Selection Process.

When a household goes under contract, their income and assets are reviewed again. If they are still under the income and asset limits for the home, they can buy. If their income or assets have increased above the limits, they will not be able to buy. Households can remain in the program and continue to enter for homes they are qualified for.

It depends. The closing costs and other costs in each transaction are negotiable between the buyer and seller. The program expects these fees to be shared equally or to follow normally acceptable terms for the area.

No. Program rules and city rental licensing ordinances do not allow post closing occupancy agreements. In the first five years, buyers must live in the home and cannot rent the home.

No. Once a household is under contract to buy, they are taken out of all other home selections and may not enter new Fair Selection Processes.