SB1168 which restricts contingency clauses in real estate contracts to no more than 180 days has cleared the Senate and been scheduled for the House’s Business & Commerce Committee.
This bill will limit all real estate contracts with contingencies for “securing permits, lots changes, zoning changes, and any other land use approvals necessary to use and operate the real property” to no more than six (6) months or 180 days.
Many of our members have expressed that this is not ample time in order to apply and receive funding from OHFA, close on transactions and ensure proper zoning, permitting, etc.
If this is of importance to your or your business, you may want to consider reaching out to members of the Business and Commerce Committee this week.
Some talking points related to this bill:
- It can easily take 8-12 months to receive zoning changes, permits, planning approvals, etc from some cities.
- Six months is not an adequate length of time to place land under contract, submit an application to OHFA and even receive notice of funding, let alone get to closing.
- The length of contingencies in contracts should remain a negotiable item between buyer and seller.
- The state should not mandate or restrict this item.
- There are no known complaints regarding this issue with OREC.
There have been some misconceptions regarding how this bill is written and some incorrect information that it would only apply to contracts with the State of Oklahoma. This is not how it is written. According to attorney review, as written, this bill would apply to all real estate contracts.