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1. Definitions. For the purpose of this section, the following definitions shall apply:
A. “Contract” means a real estate installment purchase agreement for the intended transfer of residential real estate between a buyer and seller. A real estate installment purchase agreement is one which is payable in more than four (4) installments, not including the down payment, in which the contract buyer takes possession of the property immediately but does not receive the deed and title until all installment payments have been made. This does not apply to contracts for commercial property or vacant lots.
B. “Contract buyer” means the person or entity purchasing or acquiring the real property.
C. “Contract seller” means the person or entity offering or transferring the real property for sale, or anyone acting on behalf of the contract seller.
D. “Director” means the building enforcement director of the City or his/her designee.
E. “Inspection” means a physical examination of the real estate, which shall include (but not be limited to) a review of the structural components, exterior, roofing, plumbing, heating, cooling, electrical, insulation and ventilation, interior, fireplace, and solid fuel burning appliances of the real estate.
F. “Inspection report” means a report in a form approved by the City and prepared by an inspector to describe an inspection.
G. “Inspector” means the individual who performs the examination of the real estate.
H. “Person” means an individual, a corporation, a limited liability company, a government or governmental subdivision or agency, a business trust, an estate, a trust, a partnership or an association, or any other legal entity.
I. “Transfer” means the conveyance by sale, exchange, contract or by any other method by which real property is purchased. For the purpose of this section, transfer does not mean the conveyance of real estate interests as detailed under Chapter 558A of the Code of Iowa.
2. Inspector Certification and Disqualification.
A. All inspectors who perform the inspections of real estate pursuant to a contract shall be members in good standing of an eligible professional association for home inspectors. An eligible professional association must have the following attributes:
(1) Not-for-profit status;
(2) Standards for Practice for its members;
(3) Code of Ethics for its members;
(4) Requires examinations for membership; and
(5) Requires annual continuing education.
No inspector shall be employed by an entity that is owned by a contract seller or an affiliate. The term affiliate means a parent, brother, or sister entity (meaning its parent entity has an ownership interest in each entity or shares a common manager), or a subsidiary entity or any other entity in which the contract seller, its parent, brother, sister, or subsidiary entity owns five percent (5%) or more of such entity.
B. Members of professional associations who are otherwise eligible to perform inspections shall obtain prior approval from the City to perform said inspections. The City shall have the discretion to approve or deny any inspector and shall maintain a current list of all inspectors who are eligible to perform inspections under this section.
C. The City shall have sole discretion to grant, suspend, or revoke an inspector’s certification based upon any of the following:
(2) Neglect of duty;
(4) Disqualification, suspension, or debarment from any activity related to the construction or real estate industry by an agency of any government;
(5) Offering or giving gifts or gratuities to employees of the City in violation of State law; and/or
(6) Failure to comply with any other requirements of this section.
D. If the Director determines that cause exists to disqualify an inspector from performing inspections for any of the reasons set forth above, the Director shall notify said inspector. The notice shall set forth the reason(s) for disqualification and shall be sent to the inspector by certified mail.
E. Upon written request of the inspector filed within ten (10) days of the mailing of the above-referenced notice, the Director shall schedule a hearing at which the inspector may present evidence why he or she should not be disqualified. The Director’s recommendation shall be issued within thirty (30) days of the conclusion of the hearing and shall be mailed to the inspector via certified mail. The Director’s recommendation shall be forwarded to the City Council.
3. Procedures and Fees.
A. A person seeking to transfer real property by contract, or a broker, salesperson, or agent acting on behalf of such person, shall obtain or update an inspection of the subject real estate not more than sixty (60) days prior to the execution of the contract.
B. The inspector shall prepare an inspection report of the physical examination of the real estate. The inspection report shall also include written certification that the Inspector is a member of good standing in an eligible professional association, as detailed above.
C. The inspection report shall be delivered to the contract buyer and the City at least fourteen (14) days prior to the execution of the contract. The inspection report may be delivered to the contract buyer via personal delivery and/or certified or registered mail. Proof of delivery of the inspection report along with a filing fee of $75.00 shall be filed with the City at least fourteen (14) days prior to the execution of the contract. Subsequent inspection reports and updates for the same property involving the same contract buyer may be filed by the same contract seller without requiring an additional filing fee.
D. Within seven (7) days following execution of the contract, the contract seller shall file with the City copies of all instruments transferring the real estate.
E. The City shall have the right to annually—or on an “as needed basis”—inspect any property for which an inspection is allowed under this section. All persons with ownership or management interests in the property shall allow inspection upon reasonable notice provided by the City.
F. Any person who fails to perform an act required by this section or who commits an act prohibited by this section shall be guilty of a municipal infraction.
4. Ordinance not Limiting. The responsibilities imposed under this section shall not limit or abridge any duty, requirement, obligation, or liability for disclosure created by another provision of law, or under contract between parties.
5. Alternate Procedures. In the alternative to proceeding with the provisions in (1) through (4) above, contract sellers may elect to be bound by and comply with the City’s Property Maintenance and Rental Housing Code, as outlined in Chapter 156 of this Code of Ordinances. If a contract seller elects to proceed under the governance of Chapter 156, said person must promptly notify the City and comply with all rental housing provisions prior to executing a contract.