| Confidential information—absolutely may not be distributed or used without the prior written consent of SIRVA Relocation LLC. |
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| Benefit Description | One of SIRVA’s most important roles is to help you sell your home to an outside buyer at the best possible price in the limited time available to you. If an outside buyer is not found in the allotted time, and your home qualifies, SIRVA will issue you a Guaranteed Purchase Offer (GPO), based on the average of two independent appraisals. This process, if followed accurately, provides the most favorable tax treatment to both you and the Company. The steps that will occur are different from a typical real estate transaction. Your Relocation Counselor will explain the process and provide all necessary information regarding the home sale program and will be your advocate throughout your move. |
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| Qualifications for the Program | To qualify for Home Sale Assistance, your name must appear in the title to the property and it must be your principal residence at the time of the transfer. In addition: § The program procedures outlined by this Policy and SIRVA must be followed. § You must warrant that you own and occupy the residence and that it is classified as a single-family residence, condominium, or townhouse with no adverse conditions that will prevent its marketability. This benefit requires the approval of the Company’s CEO. |
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| Ineligible Properties | The following kinds of properties do not qualify for Home Sale Assistance: § Cooperative units § Farms § Homes valued at $1,000,000 or more, as determined by the average of the Broker Market Analyses, may be ineligible subject to SIRVA’s evaluation to determine inclusion in the home sale policy § Homes with acreage in excess of five acres § Homes with acreage that does not conform to the immediate area § Houseboats § Income producing properties (other than two family duplexes owned by the employee, one unit of which is occupied by the employee) § Manufactured/Mobile homes whether on owned or leased lots § Multi-family dwellings (except a two-family residence when one part is the principal residence of the employee) § Properties containing or located by hazardous, toxic or potentially hazardous or toxic containers, materials, chemicals or gases (including but not limited to, radon, underground storage tanks, mold, UFFI, carcinogens, irritants, corrosives, environment hazardous and the like) § Properties in which inspections conducted disclose defects which rendered the property unmarketable and/or the employee does not resolve to the satisfaction of SIRVA § Properties not zoned by 1-4 family residential § Properties that are not insurable under SIRVA’s property and general insurance liability coverage for relocation homes § Properties that have been converted (not originally residential) § Properties on which clear title cannot be delivered § Properties that have EIFS (Exterior Insulating Finishing Systems), also known as synthetic stucco § Properties that do not qualify for conventional mortgage financing § Properties that have been on the market at any time within six months of the date of the employee’s initiation into the program (subject to exception between the Company and SIRVA) § Properties with building materials commonly known as “Chinese Drywall” or other drywall material with similar characteristics § Residences acquired for commercial or speculative purposes § Residences containing or located near hazardous materials (e.g. lead, Urea Formaldehyde Foam Insulation [UFFI], asbestos) § Residences that are not Federal National Mortgage Association (Fannie Mae) or Federal Home Loan Mortgage Corporation (Freddie Mac) approved § Residences undergoing renovation or construction § Resort properties § Shared ownership properties (i.e., timeshares) § Summer/vacation homes § Vacant land If any inspection discloses a significant problem, SIRVA reserves the right to exclude the home from the Home Sale Assistance program. In such event, you may be eligible for direct reimbursement of certain home selling expenses. |
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| Real Estate Agent Selection and Market Analysis | Your Relocation Counselor will select two real estate agents who have a documented record of successfully selling homes in the immediate neighborhood and within the general price range of your home. These real estate agents will independently inspect your home and complete a Broker’s Market Analysis (BMA) to establish the Most Probable (likely) Sales Price. You, members of your immediate family or other Company employees may not directly or indirectly benefit financially from the fees that the Company pays for services or other costs related to your relocation. It is for that reason that the Company will not reimburse you, an immediate family member or other relative, or another Company employee (or his/her spouse/domestic partner) for any fees for services performed as a real estate agent or broker for the sale of your primary residence. If you have a real estate agent you would like to recommend, it is important that you do not contact that agent. Instead, let your Relocation Counselor know who the agent is and where the agent can be reached. Your Relocation Counselor will then contact the agent to obtain their credentials and, if qualifications are acceptable, will select that agent as one of the agents to prepare and present a marketing plan. The brokers will send the completed BMAs to the Relocation Counselor who will review the results for thoroughness, accuracy, and logic of conclusions. Once the Relocation Counselor approves of the BMAs, the Most Probable (likely) Sales Price listed on the BMAs are averaged together and the home will be listed at no more than 105 percent of this average. If the Most Probable (likely) Sales Prices are not within five percent, a third analysis will be ordered. The two closest Most Probable (likely) Sales Prices will be averaged together and the home will be listed at no more than 105 percent of this average. The Relocation Counselor will then review the results with you, at which time you and SIRVA shall agree to proceed with the Option to Purchase and Put Agreement. |
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| Option to Purchase and Put Agreement | You will enter into an Option to Purchase and Put Agreement with SIRVA instead of listing your home in your name. This agreement enables SIRVA to list the property in SIRVA’s name, facilitate the move, and defray many relocation costs. SIRVA will pay you a small monetary consideration as determined by SIRVA (“option payment”), for your signing the Option to Purchase and Put Agreement. Upon the sale of the home to SIRVA, the option payment will be credited to the purchase price. The option will last for six months and is renewable at the end of that period of time with your consent. During this option period, SIRVA will expose the home to the marketplace. Typically, SIRVA will list the home with a real estate agent who will, through exposure to the public, determine what a buyer will pay at arm’s length for the home . The Option to Purchase and Put Agreement must be executed and returned to SIRVA prior to proceeding with the program. |
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| Seller’s Disclosure Statements and Title Report | You will be responsible for complying with all federal, state and local disclosure requirements associated with the sale of your home. This includes the completion of all real estate disclosure forms that may be required. Along with the Option to Purchase and Put Agreement, you will be given a SIRVA Seller’s Disclosure Statement for execution. This document must be executed prior to proceeding with the program. Additionally, SIRVA will order a title report on the home and advise you of the results. In the event the title report indicates a cloud on title, you will be responsible for properly clearing title before selling the home to SIRVA. SIRVA may be able to assist you in clearing clouds on title. A cloud on title is defined as any outstanding claim, lien, encumbrance, document or condition usually revealed by a title search which impairs the title and the marketability of a property. |
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| Listing the Property | The choice of the listing agent and the price at which the home is listed are subjects that the Relocation Counselor will discuss with you. Although SIRVA will list the home for sale (if that is mutually desired), the Relocation Counselor will make sure that your input is greatly considered with regard to the agent and the list price. The home will be listed at a price not to exceed 105 percent of the average of the Most Probable (likely) Sales Prices as determined from the Broker Market Analyses. Setting a proper and realistic list price is crucial to the success of selling a home in a reasonable period of time and for the highest possible price. The determination of the initial list price is based on a number of factors such as location, competition, the condition of the property, and the time of year the home is listed. Over-listing a home only benefits the competition, generally extends the marketing time of the property, and may result in a lower final sales price than if the property had been marketed more realistically from the start. |
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| Marketing Strategy | Your Relocation Counselor will discuss the best strategy for marketing the home, suggesting any repairs, maintenance, and/or decorating that you may want to do to maximize the home’s value and expedite the marketing process. The Company will not reimburse these costs. |
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| Exposure of the Home to the Marketplace | SIRVA will be responsible for marketing the home by listing the home with a real estate agent. Your Relocation Counselor will monitor all sales activity on the property to ensure that all of the best marketing procedures are being used for maximum exposure to the marketplace. Your Relocation Counselor and the real estate agent will keep you informed of all activity and feedback on the house during the marketing process. |
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| Offer to Purchase | At the point that SIRVA believes it has established fair market value through a market offer, your Relocation Counselor will notify you of the amount of the offer. If you agree that the amount constitutes fair market value, SIRVA will exercise its Option to Purchase at that amount. You may decide that the amount being offered is not sufficient for fair market value. In that event, SIRVA will continue to expose the home to the marketplace in order to determine whether there is a more accurate definition of fair market value. If a bona fide outside offer is made that is within 95 percent of the GPO, you will be required to allow SIRVA to accept that offer, however you will be provided 100 percent of the GPO. If you refuse an offer at or above 97 percent, the Put would no longer be in effect. |
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| Closing the Sale | If after all contingencies of the sale of your home to SIRVA have been met and the property remains eligible for the relocation program, and the sale of the home to the outside buyer falls through, the Contract of Sale between you and SIRVA will still be honored. Once SIRVA has exercised the Option to Purchase, a closing will be scheduled with you. You will be responsible for all costs and risks associated with the home up to and including the date of closing with SIRVA. These include but are not limited to: pro-rations for taxes, interest on the mortgage, utilities, homeowner’s insurance, agreed upon repairs required from any inspections, and any other costs associated with the ownership of the home. After the date of the closing, SIRVA will be responsible for all of those items regarding the home. At the closing between SIRVA and you, SIRVA will provide a Promissory Note for the amount of equity due to you as set forth in the Contract of Sale. You will receive the final net proceeds (the equity) in the property within approximately 10 business days from the date of the Promissory Note. Net proceeds are defined as the sales price of the home minus liens, mortgages, appropriate pro-rations, and less any equity advance you’ve already received. As provided in the Contract of Sale, there are no real estate commissions or other standard closing costs that will be deducted from the proceeds. You are responsible for disclosing all known conditions and defects of the property. If you fail to disclose, you may be responsible for all costs incurred by SIRVA as a result of the non-disclosure. IMPORTANT NOTE: At the closing with you, SIRVA does not actually take title to your home or pay off your mortgage. Instead, SIRVA takes full responsibility for making your mortgage payments, and ultimately paying off the mortgage when a sale between SIRVA and an outside buyer closes. Until a sale between SIRVA and an outside buyer closes, the title and mortgage remain in your name and will continue to appear on your credit report. SIRVA assumes all responsibility for the care and maintenance of the home once you close with SIRVA under the provisions of the Home Sale Assistance program. SIRVA will assist you if any questions should arise in regard to this process. |
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| Guaranteed Purchase Offer (GPO) | If an outside buyer has not been found by day 60 of exposing the home to the marketplace, and SIRVA has not exercised its Option to Purchase, SIRVA will order two independent ERC (Employee Relocation Council) appraisals. The appraisal values must be within five percent of each other, or a third ERC appraisal will be ordered by SIRVA. You will be advised of the GPO amount (average of the two values as determined by the appraisers—if three appraisals were ordered the two closest values will be averaged) and any inspection or other contingencies. You will be required to adjust your list price to be within 105 percent of the GPO value once it is determined. Once you have exposed the home to the marketplace for a total of 90 days, assuming the appraisal values have been delivered and all inspection issues have been resolved, you may then elect to have SIRVA purchase the home within a 60-day offer and acceptance period, which begins on the date the offer was extended to you. If you choose to accept the GPO, you must vacate the property within 10 days of your acceptance, and no later than the expiration of the 60-day offer and acceptance period. If you elect not to sell the home to SIRVA within the 60-day offer and acceptance period, you waive all rights to the GPO benefits outlined in this program. Upon closing with SIRVA, your mortgage payment(s) and taxes due after your close date will become the responsibility of SIRVA. The title and mortgage(s) will remain in your name until SIRVA sells the property to an outside buyer and the deal closes. SIRVA will also take over all utility and property maintenance payments as of your closing date. When SIRVA purchases your home from you, the mortgage with your lender is not immediately paid off. SIRVA, as the contractual purchaser of the property, will take ownership of the property subject to any existing mortgage. SIRVA is fully responsible for the mortgage payments and the subsequent payoff of the mortgage(s) as part of the consideration paid to you for the purchase of the property. The mortgage payoff will occur upon closing of the resale of the property to an outside buyer. If the mortgage company submits funds to you that were previously paid by SIRVA (i.e. escrow payments or additional interest payments), you must immediately return the funds to SIRVA or they will revert to a loan, requiring interest and a payroll deduction. |
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| Inspections | When the appraisals are ordered, SIRVA will also order and pay for inspections on your home. The inspections may include but are not limited to, a general home, pest, well and septic. If any additional inspections such as EIFS, structural, hardboard siding, etc. are required as a result of the general inspection or SIRVA’s due diligence, you may be responsible for those inspection costs. SIRVA follows the Worldwide Employee Relocation Council’s (ERC) Statement of Use: Relocation Property Assessment that identifies structural, safety and inoperable items, regardless of local/state codes. All final reports must be satisfactory. You will be solely responsible for rectifying or repairing any adverse items that appear in any inspections obtained prior to closing with SIRVA. |
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| Equity Advance | In the event you require a portion of your equity for a down payment or closing on your new home, provided you will close your home through SIRVA’s home sale assistance program, SIRVA will advance up to a maximum of 80 percent of your estimated equity based on the bona fide outside offer or the GPO less the following: § Any estimated unpaid balances on all mortgages, equity lines of credit, liens, assessments, or other encumbrances. § One-year’s property taxes. § One month’s mortgage payment for each mortgage or equity line. Contact your Relocation Counselor to request an advance. SIRVA will send you a Promissory Note stating the amount advanced. The Promissory Note must be signed by you and all owners of record and returned to SIRVA prior to advancing any funds. The advance is non-interest bearing prior to its due date. The amount advanced will be repaid to SIRVA as a deduction from your final equity payment. Equity advances generally require 7-14 days to process. The Promissory Note amount must be paid back in the event the relocation is not completed. All equity advance(s) must be repaid/reconciled within six months of being issued. |
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| Vacating the Property | In the event you are unable to vacate the property at the time of closing with SIRVA, the home may be leased back to you during the approximate three day period prior to closing with an outside buyer, at a minimum per diem of $50. A $500 security deposit will be withheld from the net proceeds and will be returned after SIRVA inspects the home following the vacate date. Under the lease, you would be responsible for utilities, general maintenance and insurance on household goods through the date of vacating and/or transfer of possession to SIRVA. Your Relocation Counselor will provide instructions for transferring utilities, keys, etc. |
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| Obligations in the Contract of Sale with SIRVA | Your obligation to SIRVA with regard to the condition of the home at closing will be similar to that which would occur in the sale to any other buyer. In fact, in the event that SIRVA sells the property and incurs any expenses, costs, or liabilities with regard to a condition of the property that existed at the date of the closing with SIRVA, you may be held responsible for those items. |
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| Bona Fide Offer Definition | A bona fide offer generally includes the following requirements: § The purchase price represents fair market value at the time of closing. § The buyer is financially qualified and capable of purchasing the property utilizing common and ordinary terms, conditions, and contingencies (which may not include a contingency for the sale of the buyer’s property) and which will be contingent on favorable results of inspections, if any, and the closing date cannot be beyond 60 days. § The property satisfies generally accepted and applicable industry criteria for a mortgage loan at standard market rates as determined by a reputable institutional lender (e.g. a bank, savings bank or mortgage company authorized to conduct business in the area). Generally accepted and applicable industry criteria for mortgage loans shall include loans eligible for repurchase under guidelines established by organizations such as "Fannie Mae" and "Freddie Mac.” The availability of financing by a particular lender such as a local portfolio lender or other non standard lending arrangement does not constitute generally accepted and applicable industry criteria for a mortgage loan. |
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Home Sale Assistance through SIRVA Tax Impact | If you sell your home through SIRVA’s Home Sale Assistance program, expenses incurred are not considered additional compensation to you; therefore tax assistance (gross-up) is not applicable. |
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| Independent Sale | Because the Company has provided a Home Sale Assistance program that allows for a tax protected transaction, an Independent Sale is not recommended for properties which are eligible for the Home Sale Assistance program. However if you elect the Independent Sale option, you will be eligible to receive reimbursement of normal and customary home sale closing costs, including: § Brokerage or agent commission on sale (maximum 6 percent of sale price) § Normal and customary home sale closing costs, including: - Attorney/escrow fees - Customary federal, state and local transfer taxes - Filing and notary fees - Legal fees Discount points and special financing costs will not be reimbursed. If you elect the Independent Sale option, you will not be eligible for the Home Sale Incentive Bonus. |
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Independent Sale Tax Impact | If you elect not to participate in the Home Sale Assistance program, expenses reimbursed will be considered additional compensation. This payment will not be tax assisted (not grossed-up). If your home is ineligible for the Home Sale Assistance program, expenses reimbursed will be considered additional compensation. This payment will be tax assisted (grossed-up). |
Relocation Policy