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 Virginia Short Sale Addendum to the Contract for the Price, Purchase, and Sale of Real Estate is a vital document that outlines the specific terms and conditions for a short sale transaction in the state of Virginia. This addendum is typically used when a homeowner wishes to sell their property for less than the outstanding mortgage balance. The Virginia Short Sale Addendum serves as an essential agreement between the buyer, the seller, and the lender, ensuring all parties are aware of the unique circumstances and requirements involved in a short sale. Here are some relevant keywords for this addendum: 1. Short Sale: A process in which a property is sold for a lesser amount than what the homeowner owes on their mortgage. 2. Addendum: An additional document that supplements and modifies the terms and conditions of the original contract. 3. Price, Purchase, and Sale of Real Estate: The overarching contract governing the sale of the property, to which the Virginia Short Sale Addendum is appended. 4. Lender Approval: The stipulation that the sale is contingent upon the lender's approval, as they will ultimately need to agree to accept less than the mortgage balance. 5. Deficiency Judgment Waiver: A provision that protects the seller from future legal action by the lender to recover the remaining debt once the short sale is complete. 6. Short Sale Negotiator: A third-party professional who assists in facilitating the short sale process, ensuring effective communication between all parties involved. 7. Property Sold As-Is: Specifies that the property is being sold in its current condition, typically relieving the seller of any responsibility for repairs or improvements. 8. Contingencies: Additional conditions that must be met before the short sale can proceed, such as inspections, appraisals, or the buyer's ability to secure financing. Different variations of the Virginia Short Sale Addendum may exist, tailored to specific situations or lender requirements. For example, there could be separate addenda for different financial institutions or if the short sale involves multiple liens on the property. In conclusion, the Virginia Short Sale Addendum to the Contract for the Price, Purchase, and Sale of Real Estate is a critical document that outlines the terms and conditions specific to short sale transactions in Virginia. It ensures all parties involved are fully informed and protected throughout the process, leading to a smooth and successful sale.
