Some state real estate commissions require the use of a buyout addendum when a real estate broker enters into a contract to purchase a property: i) concurrent with the listing of such property; ii) as an inducement or to facilitate the property owner's purchase of another property; or iii) continues to market that property on behalf of the owner under an existing listing contract.
It is generally recommended that a real estate broker use such an addendum when he/she continues to market the property and is only agreeing to buy it to make the deal. If a licensee actually wants to own the property, using the addendum does not solve the conflict of interest.
This form is a generic example that may be referred to when preparing such a form for your particular state. It is for illustrative purposes only. Local laws should be consulted to determine any specific requirements for such a form in a particular jurisdiction.
Connecticut Real Estate Broker Buyout and Price Addendum to Contract to Buy and Sell Real Estate is a legal agreement addendum used in real estate transactions within the state of Connecticut. This addendum involves the inclusion of specific terms and conditions related to the buyout of a real estate broker and the adjustment of the purchase price in the contract. The Connecticut Real Estate Broker Buyout and Price Addendum provides a solution for situations where a buyer wishes to purchase a property represented by a real estate broker without having to bear the burden of paying the broker's commission. It offers an alternative arrangement, allowing the buyer to pay a specific amount directly to the broker, which eliminates the commission obligation on the buyer's part. The addendum ensures transparency and clarity in the transaction by outlining the terms of the buyout agreement. It typically includes the following details: 1. Identification of the involved parties: The addendum specifies the names and contact information of the buyer, seller, and the real estate broker. 2. Broker's commission payment: This section provides details on the agreed-upon amount the buyer will pay directly to the broker, in lieu of the traditional commission. It states whether this payment will be made at closing or separately from the closing process. 3. Purchase price adjustment: The addendum also covers how the payment made to the broker affects the purchase price. It explains whether the buyer receives a reduction in the purchase price equivalent to the broker's commission, or if it remains unchanged. 4. Broker representation acknowledgement: This section confirms that the buyer acknowledges the broker's role in the transaction and verifies that the broker's representation of the buyer is terminated upon the execution of the addendum. In addition to the general Connecticut Real Estate Broker Buyout and Price Addendum, there might be variations or specific types tailored for different situations. Examples may include: 1. Exclusive Broker Buyout and Price Addendum: Used when the buyer desires to buy out their exclusive broker's commission. This type of addendum is specific to situations where a buyer has an exclusive agreement with a broker. 2. Multiple Broker Buyout and Price Addendum: Applicable when multiple brokers are involved in the transaction, and the buyer intends to buy out commissions of more than one broker. This addendum ensures all brokers' commission obligations are adequately addressed. It is crucial to review and understand the specific terms of the Connecticut Real Estate Broker Buyout and Price Addendum before including it in a contract to buy and sell real estate. Seeking legal advice from a real estate attorney or consulting with a licensed real estate professional can help ensure the addendum accurately reflects the agreed-upon terms and protects the interests of all parties involved.
