California Real Estate Contract Guide
California uses CAR (California Association of Realtors) forms as the industry standard for residential transactions. With the most extensive disclosure requirements in the country, a unique contingency removal process, and specific timeline rules, CA contracts demand attention to detail.
CAR Standard Forms
California doesn't mandate specific forms by law, but CAR forms are the de facto standard used in the vast majority of residential transactions. Most MLS systems require CAR forms.
CAR RPA (Residential Purchase Agreement)
The primary contract form for residential purchases. Comprehensive — runs 10+ pages and covers financing, contingencies, allocation of costs, and closing terms.
CAR Counter Offer (CO)
Used for counter-offers. Multiple counters are common in California's competitive markets. Each counter creates a new offer that must be accepted in full.
CAR Contingency Removal (CR)
The form used to actively remove contingencies. In California, contingencies must be affirmatively removed — they don't just expire. This is a critical distinction.
CAR Request for Repair (RR)
Used after inspections to request seller repairs or credits. Negotiations on repairs are a major part of California transactions.
CAR Cancellation of Contract (CC)
The form used to cancel a transaction. Specifies reasons for cancellation and terms for earnest money release.
CA Deadline Rules
California generally counts deadlines in calendar days from acceptance. Understanding the distinction between contingency deadlines and the contingency removal process is essential.
Calendar days from acceptance
Most deadlines run from the date of acceptance (when the last party signs). Day 1 is the day after acceptance.
17-day default inspection contingency
If no other timeframe is specified, the buyer has 17 days to complete inspections. This is a default in the CAR RPA — it can be shortened or lengthened.
21-day default loan contingency
The default financing contingency period is 21 days. Buyer must actively remove this contingency or cancel.
17-day default appraisal contingency
Matches the inspection contingency default. Can be waived in competitive offers.
Active removal required
Unlike many states, California contingencies don't automatically expire. The buyer must affirmatively remove them using the CR form. If they don't, the seller can issue a Notice to Buyer to Perform, giving the buyer typically 2 days to remove or cancel.
Automate deadline tracking
Upload your California contract to Fyxture's deadline tracker and get every deadline extracted automatically with CA-specific day counting rules applied. Calendar sync included.
CA Contingency Rules
California's contingency system is unique because contingencies must be actively removed by the buyer. They do not simply expire on their deadline. This creates a different dynamic than most other states.
Inspection Contingency (17 days default)
Buyer can investigate the physical condition of the property. Includes the right to have professional inspections for general condition, roof, pest, chimney, pool, and any other concerns. Buyer must remove this contingency or cancel.
Loan/Financing Contingency (21 days default)
Protects the buyer if they cannot obtain financing. Buyer must provide loan status letters. If the buyer cannot remove the contingency, they can cancel. If they fail to act, the seller can issue a Notice to Buyer to Perform.
Appraisal Contingency (17 days default)
If the property doesn't appraise at the purchase price, the buyer can negotiate, make up the difference, or cancel. Frequently waived in competitive markets, which is risky for buyers.
Title Contingency
Buyer has the right to review and approve the preliminary title report. Exceptions to title (easements, liens, CC&Rs) must be acceptable to the buyer.
HOA Document Contingency
If the property is in an HOA, the buyer has a right to review all HOA documents (CC&Rs, financials, minutes, rules). This has its own timeline separate from inspections.
For a complete overview of how contingencies work, see our guide: Real Estate Contract Contingencies Explained.
CA Disclosure Requirements
California has the most extensive disclosure requirements in the United States. Sellers must provide numerous disclosures, and agents have an independent duty to conduct a visual inspection.
Transfer Disclosure Statement (TDS)
Seller's detailed disclosure about property condition — structural, systems, environmental, and known defects. One of the most important documents in a CA transaction.
Natural Hazard Disclosure (NHD)
Covers earthquake fault zones, flood zones, fire hazard zones, and other natural hazards. Usually prepared by a third-party NHD company.
Agent Visual Inspection Disclosure (AVID)
Both listing and buyer's agents must conduct their own visual inspection and disclose findings. This is an affirmative duty unique to California.
Seller Property Questionnaire (SPQ)
Supplemental disclosure covering neighborhood issues, insurance claims, deaths on property, and other material facts.
Megan's Law Disclosure
California requires disclosure that a database of registered sex offenders is available. Provided as a standard form.
Local Disclosures
Many California cities and counties require additional disclosures — earthquake bolting requirements (SF), landslide zones (LA), water conservation (statewide), and more.
Smoke/CO Detector Compliance
Seller must provide a written statement of compliance with smoke detector and carbon monoxide detector requirements.
CA Earnest Money Rules
California refers to the initial deposit as 'earnest money' or simply 'deposit.' The rules around handling and release are governed by state law and the CAR RPA.
Typical amount
Usually 1% to 3% of the purchase price. Higher deposits are common in competitive markets and signal serious intent.
Deposit timeline
The initial deposit is typically due within 3 business days of acceptance. Additional deposits may be required at contingency removal.
Held by escrow
In California, earnest money is held by a licensed escrow company, not a broker or title company. The escrow company is a neutral third party.
Release requires mutual instructions
Both parties must sign cancellation and release instructions for the deposit to be released. If they disagree, the escrow company holds the funds until resolution.
Buyer at risk after contingency removal
Once the buyer removes all contingencies, the deposit is at risk. If the buyer then fails to close, the seller may be entitled to the deposit as liquidated damages (up to 3% of purchase price for residential property).
Learn more about common pitfalls: Earnest Money Clause Mistakes (And How to Fix Them Fast).
California-Specific Rules
California's real estate transaction process has several unique features that differ significantly from other states.
Escrow process
California uses an independent escrow company to handle closing, rather than an attorney or title company. The escrow officer is a neutral third party who manages all documents and funds.
Notice to Buyer to Perform (NBP)
If a buyer misses a contingency removal deadline, the seller can issue an NBP giving the buyer typically 2 days to either remove the contingency or cancel. This is a critical mechanism in California transactions.
Liquidated damages cap
For residential property (1-4 units), liquidated damages are capped at 3% of the purchase price if the buyer defaults. Both parties must initial this provision in the contract.
As-Is provisions
Even in an 'as-is' sale in California, the seller must still provide all required disclosures. 'As-is' means the seller won't make repairs, but they cannot hide known defects.
Dual agency disclosure
California allows dual agency (one agent representing both buyer and seller) but requires written disclosure and consent from both parties. Many agents avoid it due to liability concerns.
Upload your California contract for instant analysis
Get a complete breakdown of deadlines, contingencies, risks, and obligations specific to CA contracts — in under 60 seconds.