An addendum is a thing to be added; an addition. For example, it may be used to add supplemental terms or conditions to a contract or make corrections or supply omissions to a document. An addendum is often used to supply additional terms to standardized contracts, such as leases. Addendum is singular; the plural form is addenda.
The Minnesota Price Escalation Addendum to Agreement of Sale is a legal document that is commonly used in real estate transactions in the state of Minnesota. This addendum provides a mechanism for adjusting the purchase price of a property based on changes in market conditions or competing offers. The purpose of the Minnesota Price Escalation Addendum is to protect buyers from losing out on a property to a higher offer, while also providing sellers with fair compensation for their property. There are two main types of Minnesota Price Escalation Addenda: 1. Fixed Percentage Addendum: This type of addendum allows the buyer to include a predetermined percentage increase in their original offer. For example, if the buyer offers $300,000 with a 5% escalation clause, and another offer comes in at $310,000, the buyer's offer will automatically increase to $325,500, putting them in a better position to secure the property. 2. Competitive Bidding Addendum: This type of addendum allows the buyer to outbid competing offers up to a certain limit. For example, if the buyer includes a competitive bidding addendum with a maximum offer of $350,000, and a competing offer comes in at $340,000, the buyer's offer will increase to $341,000, ensuring that they remain the highest bidder. The Minnesota Price Escalation Addendum is subject to certain terms and conditions, such as a specific time frame for accepting competing offers and a requirement for the buyer to provide evidence of the competing offer. Both parties must agree to the terms of the addendum and sign it as part of the overall agreement of sale. In conclusion, the Minnesota Price Escalation Addendum to Agreement of Sale is a useful tool for buyers who want to remain competitive in a hot real estate market. By including this addendum in their offer, buyers can increase their chances of securing a property without overpaying.
