I just issued a CURE Period Notice.  “A what?” you say.  That’s what I thought.  Unless you’ve been on either side of a CURE Period Notice it’s not something you probably know much about.  I get the amazing opportunity to chat with you today about one of the most underutilized, misunderstood {uber exciting} bits of our AZ Residential Real Estate Purchase Contract:  The CURE Period Notice.

(Editors Note: If you want to talk to Shar more she loves to connect on Facebook
And don’t forget to follow the Phoenix Real Estate Guy page there too.)

It all started back in the day” you know” way back when we had a crazy Seller’s market and properties were increasing by $20,000 each month (sound familiar to anyone? No, me neither.)  Buyers found themselves in a sticky situation should they wind up in breach of contract.  For example, if their loan ran into a snafu and they were one day past the close of escrow date the Seller could elect to cancel the contract, retain the Buyer’s earnest deposit AND resell the house to another Buyer waiting in the wings often with a higher offer price.  Sounds a little bit harsh, right?

Enter, THE CURE NOTICE, incorporated into the purchase contract in 2005:

CURE Period: A party shall have an opportunity to cure a potential breach of this Contract.  If a party fails to comply with any provision of this Contract, the other party shall deliver a notice to the non-complying party specifying the non-compliance.  If the non-compliance is not cured within three (3) days after the delivery of such notice (“Cure Period”), the failure to comply shall become a breach of Contract. (lines 272-275 of the purchase contract)

What this means to you as a Buyer or Seller is there is no “automatic” breach of contract.  The non-breaching party must issue a CURE PERIOD NOTICE to the breaching party detailing the non-compliance and giving them 3 full calendar days AFTER delivery of said notice to cure the breach.

Here’s a sampling of reasons that a CURE Notice might be issued:

• Earnest money hasn’t been delivered to the title company
• Seller’s Property Disclosure Statement (SPDS) or CLUE Report not given within 5 days
• Lead Based Paint Disclosure not delivered within 5 days
• Loan documents not delivered to title 3 days prior to closing
• Buyers funds not being delivered to title
• Seller not making the premises available for inspections or the final walkthrough
• Seller not having the utilities on for inspections
• Seller not signing their title documents prior to the close of escrow date

So…how does this play out?  Let’s take the same scenario above where the Buyer has failed to close on time.  If the Seller intends to cancel the contract (or merely scare the beejeebies out of the Buyer) the Seller must deliver a CURE Period Notice after the failure to close and then allow 3 days for the Buyer to “cure” their breach.  After the 3 days has passed, and if the Buyer still has not fulfilled their contractual obligations, the Seller may elect to cancel the contract.  Are you counting days with me here?  That’s effectively 5 days after the initial breach before the Seller can cancel.

There you have the CURE Period Notice. Something that you’ll hopefully not have to deal with but to make sure your favorite REALTOR is familiar with should you find that someone in your contract is in breach.

Friend or Foe? Depends on which side of the breach you’re on, I guess.  I’d love to hear your thoughts.