In real estate, a short sale occurs when a bank or mortgage lender agrees to discount a loan balance due to an economic hardship on the part of the mortgagor (i.e., the seller). Circumstances determine whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market climate and the individual borrower's financial situation. A short sale typically is executed to prevent a home foreclosure. Often a bank will choose to allow a short sale if they believe that it will result in a smaller financial loss than foreclosing.
This form is a sample of an Addendum to a standard real estate sales contract in order to incorporate the short sales provisions. 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.
The Illinois Short Sale Addendum to Contract for the Price, Purchase, and Sale of Real Estate is a crucial document that outlines the specific conditions and terms involved in a short sale transaction in the state of Illinois. This addendum serves as an extension to the purchase agreement, providing clarity and protection for both the buyer and the seller. In Illinois, there are different types of Short Sale Addenda that may be used depending on the circumstances of the sale. Some common types include: 1. Standard Illinois Short Sale Addendum: This addendum is used in most short sale transactions and incorporates the necessary provisions to navigate the complexities associated with a short sale. It outlines the timelines, responsibilities, and obligations of the parties involved. 2. Illinois Short Sale Addendum with Financial Approval Contingency: In cases where the seller is still awaiting approval from their lender regarding the short sale, this addendum includes a contingency that allows the buyer to terminate the contract if the seller's lender does not approve the sale within a specified timeframe. 3. Illinois Short Sale Addendum with Third-Party Negotiator: If a third-party negotiator, such as a licensed real estate agent or an attorney, is involved in the negotiations with the seller's lender, this addendum details the roles and responsibilities of the negotiator and establishes their fee structure. 4. Illinois Short Sale Addendum with Seller Concessions: When the seller is unable to cover the full costs associated with the short sale, this addendum allows for negotiations and potential concessions from the buyer regarding expenses such as closing costs or repairs. The Illinois Short Sale Addendum to Contract for the Price, Purchase, and Sale of Real Estate is a highly specialized document that ensures all parties are aware of their obligations and rights during a short sale transaction. It is crucial to consult a qualified real estate attorney or professional when preparing or reviewing this addendum to ensure compliance with Illinois state laws and regulations. Properly drafting and executing the addendum can help facilitate a smooth and successful short sale transaction for all parties involved in the real estate transaction.
