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 South Dakota Short Sale Addendum to Contract for the Price, Purchase and Sale of Real Estate is a crucial document used in real estate transactions involving short sales in the state of South Dakota. When a homeowner is facing financial distress and is unable to meet their mortgage obligations, they may choose to pursue a short sale as an alternative to foreclosure. A short sale occurs when the lender agrees to accept a sale price for the property that is less than the amount owed on the mortgage. The South Dakota Short Sale Addendum to Contract is designed to be incorporated into the standard purchase and sale agreement, specifically addressing the unique aspects of a short sale transaction. This addendum is necessary to outline the terms and conditions surrounding the short sale, protecting both the buyer and the seller. Some relevant keywords associated with the South Dakota Short Sale Addendum to Contract include: 1. Short Sale: This indicates that the seller is pursuing a short sale to avoid foreclosure. 2. Addendum: This refers to an attachment or additional document that modifies the terms and conditions of the purchase agreement. 3. Contract: The primary agreement between the buyer and seller outlining the terms of the sale. 4. Real Estate: Pertaining to property or land and its ownership. 5. Purchase and Sale: The act of buying and selling a property. Additionally, different types of South Dakota Short Sale Addendums may exist based on the specific requirements of the lender or other parties involved. These variations can include: 1. Third-Party Approval Addendum: Required if the short sale is subject to the approval of the lender or any other third party. 2. Purchase Price Negotiation Addendum: Used when the purchase price of the property needs to be negotiated between the buyer, seller, and lender. 3. Contingency Addendum: Included when certain conditions or contingencies need to be met for the short sale to proceed, such as the approval of the seller's mortgage holder. In summary, the South Dakota Short Sale Addendum to Contract for the Price, Purchase, and Sale of Real Estate is a vital document used in short sale transactions within the state. It addresses the unique aspects of a short sale, such as third-party approval and price negotiations, ensuring a clear and comprehensive agreement between the buyer and seller.
