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 Ohio Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate is a crucial document in the real estate industry. This addendum specifically caters to short sale transactions, which occur when the sale proceeds fall short of the outstanding mortgage balance on a property. This situation often arises when the current market value of the property is less than the amount owed on the mortgage. The Ohio Short Sale Addendum plays a significant role in outlining the terms and conditions of the short sale transaction, protecting both the buyer and the seller. This legally binding contract supplement provides clarity and transparency to all parties involved and ensures that the entire process adheres to Ohio's specific regulations and requirements. Key elements covered by the Ohio Short Sale Addendum may include: 1. Purchase Price: This section stipulates the agreed-upon purchase price for the property. It is important to note that in a short sale transaction, the negotiated price may be lower than the outstanding mortgage balance. 2. Closing Costs: The addendum may address who will be responsible for paying various closing costs, such as title insurance, recording fees, transfer taxes, and attorney fees. These expenses are typically negotiable depending on the circumstances of the sale. 3. Financing and Contingencies: The Ohio Short Sale Addendum may outline any financing conditions or contingencies that need to be fulfilled for the purchase to proceed. This includes securing a mortgage loan or obtaining approval from a third-party lien holder or mortgage insurer. 4. Property Condition and Inspections: The addendum can address the property's condition, clarifying whether it is being sold "as-is" or if the seller is willing to make necessary repairs or provide allowances for any deficiencies. It may also discuss the buyer's right to conduct inspections during the due diligence period. 5. Seller's Financial Obligations: The addendum may define the seller's responsibilities regarding outstanding liens, unpaid property taxes, and other financial obligations related to the property. It outlines how these obligations will be settled and ensures transparency throughout the short sale process. It is important to note that different types or variations of the Ohio Short Sale Addendum may exist based on various factors, including specific lender requirements or individual agreements between parties. Some additional variations to consider could include: 1. Ohio Short Sale Addendum with Seller Contributions: In certain cases, the seller may agree to make financial contributions toward the buyer's closing costs or other expenses associated with the transaction. This variation would outline the terms and conditions of such contributions. 2. Ohio Short Sale Addendum with Multiple Liens: If there are multiple liens or mortgages on the property, this variation of the addendum would address how the proceeds from the sale will be distributed among these different lien holders. 3. Ohio Short Sale Addendum with Seller Cooperation: This variation focuses on the seller's commitment to cooperating with the lender's requirements throughout the short sale process, including timely document submission and communication. In summary, the Ohio Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate is a critical document that helps facilitate short sale transactions in Ohio while ensuring transparency and compliance with relevant regulations. It serves to protect the interests of both the buyer and the seller, clarifying the terms, conditions, and obligations associated with the sale.The Ohio Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate is a crucial document in the real estate industry. This addendum specifically caters to short sale transactions, which occur when the sale proceeds fall short of the outstanding mortgage balance on a property. This situation often arises when the current market value of the property is less than the amount owed on the mortgage. The Ohio Short Sale Addendum plays a significant role in outlining the terms and conditions of the short sale transaction, protecting both the buyer and the seller. This legally binding contract supplement provides clarity and transparency to all parties involved and ensures that the entire process adheres to Ohio's specific regulations and requirements. Key elements covered by the Ohio Short Sale Addendum may include: 1. Purchase Price: This section stipulates the agreed-upon purchase price for the property. It is important to note that in a short sale transaction, the negotiated price may be lower than the outstanding mortgage balance. 2. Closing Costs: The addendum may address who will be responsible for paying various closing costs, such as title insurance, recording fees, transfer taxes, and attorney fees. These expenses are typically negotiable depending on the circumstances of the sale. 3. Financing and Contingencies: The Ohio Short Sale Addendum may outline any financing conditions or contingencies that need to be fulfilled for the purchase to proceed. This includes securing a mortgage loan or obtaining approval from a third-party lien holder or mortgage insurer. 4. Property Condition and Inspections: The addendum can address the property's condition, clarifying whether it is being sold "as-is" or if the seller is willing to make necessary repairs or provide allowances for any deficiencies. It may also discuss the buyer's right to conduct inspections during the due diligence period. 5. Seller's Financial Obligations: The addendum may define the seller's responsibilities regarding outstanding liens, unpaid property taxes, and other financial obligations related to the property. It outlines how these obligations will be settled and ensures transparency throughout the short sale process. It is important to note that different types or variations of the Ohio Short Sale Addendum may exist based on various factors, including specific lender requirements or individual agreements between parties. Some additional variations to consider could include: 1. Ohio Short Sale Addendum with Seller Contributions: In certain cases, the seller may agree to make financial contributions toward the buyer's closing costs or other expenses associated with the transaction. This variation would outline the terms and conditions of such contributions. 2. Ohio Short Sale Addendum with Multiple Liens: If there are multiple liens or mortgages on the property, this variation of the addendum would address how the proceeds from the sale will be distributed among these different lien holders. 3. Ohio Short Sale Addendum with Seller Cooperation: This variation focuses on the seller's commitment to cooperating with the lender's requirements throughout the short sale process, including timely document submission and communication. In summary, the Ohio Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate is a critical document that helps facilitate short sale transactions in Ohio while ensuring transparency and compliance with relevant regulations. It serves to protect the interests of both the buyer and the seller, clarifying the terms, conditions, and obligations associated with the sale.
