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 Michigan Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate is an important document used in real estate transactions involving short sales in the state of Michigan. This addendum serves as an attachment to the main purchase agreement and outlines specific terms and conditions that apply to short sale purchases. The Michigan Short Sale Addendum is designed to protect both the buyer and the seller during the process of buying or selling a property that is priced below the outstanding mortgage balance. It provides clarity on various aspects of the transaction, including the pricing, timelines, and responsibilities of both parties involved. There are a few different types of Michigan Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate that can be used, depending on the specific requirements and situations involved. These may include: 1. Standard Michigan Short Sale Addendum: This is a general addendum that covers the basic terms and conditions common to most short sale transactions in Michigan. It outlines the purchase price, the negotiation process with the lender, and the timelines for approval and closing. 2. Michigan Short Sale Addendum with Contingencies: This type of addendum includes additional contingencies that protect the buyer's interests during the short sale process. These contingencies may include the requirement for a satisfactory inspection, lender approval of terms, and the buyer's ability to secure financing. 3. Customized Michigan Short Sale Addendum: In some cases, parties involved in a short sale transaction may have unique requirements or specific clauses they wish to include. In such instances, a customized addendum may be created, outlining the specific terms and conditions agreed upon by both parties. Overall, the Michigan Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate is an essential document that provides a clear framework for short sale transactions. It helps ensure transparency, protect the interests of both buyer and seller, and streamline the process of buying or selling a property through a short sale in Michigan.
