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.
A Missouri Price Escalation Addendum to Agreement of Sale is a document used in real estate transactions to address potential price increases in the purchase of a property. This addendum serves as an agreement between the buyer and seller to address possible changes in the sales price based on certain predefined conditions or market fluctuations. This type of addendum is particularly beneficial in a competitive real estate market where multiple offers are received on a property. It allows buyers to enhance their offer by including a price escalation clause, which automatically increases their offer price if a competing buyer submits a higher bid. The purpose of this addendum is to provide a fair and transparent process for determining the final sales price. There are various types of Missouri Price Escalation Addendums to Agreement of Sale, namely: 1. Price Escalation Addendum with Fixed Percentage Increase: In this scenario, the buyer agrees to increase their offer price by a fixed percentage over the highest competing offer. For instance, if the buyer's original offer is $200,000 and another buyer submits a higher offer at $220,000, the first buyer's offer automatically increases by a predetermined percentage, such as 3%. Thus, their revised offer becomes $226,600 ($220,000 + 3%). 2. Price Escalation Addendum with Fixed Dollar Increase: This type of addendum operates similarly to the fixed percentage increase, but the increase is expressed as a fixed dollar amount. For instance, if the buyer's original offer is $200,000 and a competing offer comes in at $220,000, the buyer's offer automatically increases by a predetermined fixed dollar amount, such as $5,000. Therefore, their revised offer becomes $225,000 ($220,000 + $5,000). 3. Price Escalation Addendum with Appraisal-Based Increase: In this scenario, the increase in the buyer's offer price is determined based on the appraised value of the property. If a competing offer with a higher price is submitted, the buyer's offer will increase by the difference between the competing offer and the appraised value. This type of addendum ensures that the buyer's offer never exceeds the appraised value of the property. 4. Price Escalation Addendum with Seller's Acceptance: Unlike the previous types, this addendum requires the seller's acceptance of the escalated offer. The buyer's original offer includes a provision stating that their offer is increased by a certain percentage or a fixed amount over the highest competing offer received. However, the final sales price is subject to the seller's approval, even if the offer surpasses other bids. This Missouri Price Escalation Addendum is a valuable tool for both buyers and sellers, as it facilitates a fair and transparent bidding process in competitive real estate markets. The specific type of addendum used may vary depending on the preferences and circumstances of the parties involved in the transaction.A Missouri Price Escalation Addendum to Agreement of Sale is a document used in real estate transactions to address potential price increases in the purchase of a property. This addendum serves as an agreement between the buyer and seller to address possible changes in the sales price based on certain predefined conditions or market fluctuations. This type of addendum is particularly beneficial in a competitive real estate market where multiple offers are received on a property. It allows buyers to enhance their offer by including a price escalation clause, which automatically increases their offer price if a competing buyer submits a higher bid. The purpose of this addendum is to provide a fair and transparent process for determining the final sales price. There are various types of Missouri Price Escalation Addendums to Agreement of Sale, namely: 1. Price Escalation Addendum with Fixed Percentage Increase: In this scenario, the buyer agrees to increase their offer price by a fixed percentage over the highest competing offer. For instance, if the buyer's original offer is $200,000 and another buyer submits a higher offer at $220,000, the first buyer's offer automatically increases by a predetermined percentage, such as 3%. Thus, their revised offer becomes $226,600 ($220,000 + 3%). 2. Price Escalation Addendum with Fixed Dollar Increase: This type of addendum operates similarly to the fixed percentage increase, but the increase is expressed as a fixed dollar amount. For instance, if the buyer's original offer is $200,000 and a competing offer comes in at $220,000, the buyer's offer automatically increases by a predetermined fixed dollar amount, such as $5,000. Therefore, their revised offer becomes $225,000 ($220,000 + $5,000). 3. Price Escalation Addendum with Appraisal-Based Increase: In this scenario, the increase in the buyer's offer price is determined based on the appraised value of the property. If a competing offer with a higher price is submitted, the buyer's offer will increase by the difference between the competing offer and the appraised value. This type of addendum ensures that the buyer's offer never exceeds the appraised value of the property. 4. Price Escalation Addendum with Seller's Acceptance: Unlike the previous types, this addendum requires the seller's acceptance of the escalated offer. The buyer's original offer includes a provision stating that their offer is increased by a certain percentage or a fixed amount over the highest competing offer received. However, the final sales price is subject to the seller's approval, even if the offer surpasses other bids. This Missouri Price Escalation Addendum is a valuable tool for both buyers and sellers, as it facilitates a fair and transparent bidding process in competitive real estate markets. The specific type of addendum used may vary depending on the preferences and circumstances of the parties involved in the transaction.
