| THIRD PARTY FINANCING CONDITION ADDENDUM |
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Note: This addendum is only necessary if the parties have checked the option in Paragraph 4(A)(1) of Real Estate Purchase contract for Condominiums. THIRD PARTY FINANCING CONDITION ADDENDUM ___________________________________________________________________________ Purchaser shall apply promptly for all financing described below and make every reasonable effort to obtain financing approval. Financing approval will be deemed to have been obtained when the lender determines that Purchaser has satisfied all of lender's financial requirements (those items relating to Purchaser's assets, income and credit history). If financing (including any financed PMI premium) approval is not obtained within ______ days after the effective date, this contract will terminate and the earnest money will be refunded to Purchaser. Each note must be secured by an appropriate instrument authorized within the state, typically either (1) a mortgage or (2) vendor's and deed of trust liens. (Consult an attorney if you are unsure as to which instrument is appropriate for this transaction.) CHECK APPLICABLE BOXES: _____ A. CONVENTIONAL FINANCING: _____ C. VA GUARANTEED FINANCING: A VA guaranteed loan of not less than $______________ (excluding any financed Funding Fee), amortizable monthly for not less than _______ years, with interest not to exceed _______% per annum for the first _______ year(s) of the loan with Loan Fees not to exceed _______% of the loan. VA NOTICE TO PURCHASER: ""It is expressly agreed that, notwithstanding any other provisions of this contract, the Purchaser shall not incur any penalty by forfeiture of earnest money or otherwise or be obligated to complete the purchase of the Property described herein, if the contract purchase price or cost exceeds the reasonable value of the Property established by the Department of Veterans Affairs. The Purchaser shall, however, have the privilege and option of proceeding with the consummation of this contract without regard to the amount of the reasonable value established by the Department of Veterans Affairs."" If Purchaser elects to complete the purchase at an amount in excess of the reasonable value established by VA, Purchaser shall pay such excess amount in cash from a source which Purchaser agrees to disclose to the VA and which Purchaser represents will not be from borrowed funds except as approved by VA. If VA reasonable value of the Property is less than the Sales Price, Seller may reduce the Sales Price to an amount equal to the VA reasonable value and the sale will be closed at the lower Sales Price with proportionate adjustments to the down payment and the loan amount. PURCHASER: ____________________ ____________________________________________ ____________________________________________ SELLER: ____________________ ____________________________________________
Note: This addendum is only necessary if the parties have checked the option in Paragraph 4(B) above. LOAN ASSUMPTION ADDENDUM ___________________________________________________________________________ A. CREDIT DOCUMENTATION: Within _____ days after the effective date of this contract, Purchaser shall deliver to Seller the following: [check all applicable items:] _____credit report _____verification of employment, including salary _____verification of funds on deposit in financial institutions ____current financial statement to establish Purchaser's creditworthiness. Purchaser hereby authorizes any credit reporting agency to furnish to Seller at Purchaser's sole expense copies of Purchaser's credit reports. B. CREDIT APPROVAL: If Purchaser's documentation is not delivered within the specified time, Seller may terminate this contract by notice to Purchaser within 7 days after expiration of the time for delivery, and the earnest money will be paid to Seller. If the documentation is timely delivered, and Seller determines in Seller's sole discretion that Purchaser's credit is unacceptable, Seller may terminate this contract by notice to Purchaser within 7 days after expiration of the time for delivery and the earnest money will be refunded to Purchaser. If Seller does not terminate this contract, Seller will be deemed to have accepted Purchaser's credit. C. ASSUMPTION: _____ (1) The unpaid principal balance of a first lien promissory note payable to which unpaid balance at closing will be $________________. The total current monthly payment including principal, interest and any reserve deposits is $________________. Purchaser’s initial payment will be the first payment due after closing. _____ (2) The unpaid principal balance of a second lien promissory note payable to which unpaid balance at closing will be $________________. The total current monthly payment including principal, interest and any reserve deposits is $________________. Purchaser’s initial payment will be the first payment due after closing. Purchaser’s assumption of an existing note includes all obligations imposed by the deed of trust securing the note. If the unpaid principal balance(s) of any assumed loan(s) as of the Closing Date varies from the loan balance(s) stated above, the [check only one:] _____cash payable at closing _____Sales Price will be adjusted by the amount of any variance; provided, if the total principal balance of all assumed loans varies in an amount greater than $350.00 at closing, either party may terminate this contract and the earnest money will be refunded to Purchaser unless the other party elects to eliminate the excess in the variance by an appropriate adjustment at closing. Purchaser may terminate this contract and the earnest money will be refunded to Purchaser if the noteholder requires (a) payment of an assumption fee in excess of $________________ in (1) above or $________________ in (2) above and Seller declines to pay such excess, (b) an increase in the interest rate to more than ________% in (1) above, or ________% in (2) above, (c) any other modification of the loan documents, or (d) consent to the assumption of the loan and fails to consent. An appropriate instrument authorized within the state, typically either (1) a mortgage or (2) vendor's and deed of trust liens, to secure the assumption will be required, and it will automatically be released on execution and delivery of a release by noteholder. If Seller is released from liability on any assumed note, the instrument securing the assumption will not be required. If noteholder maintains an escrow account, the escrow account must be transferred to Purchaser without any deficiency. Purchaser shall reimburse Seller for the amount in the transferred accounts. NOTICE TO PURCHASER: The monthly payments, interest rates or other terms of some loans may be adjusted by the noteholder at or after closing. If you are concerned about the possibility of future adjustments, do not sign the contract without examining the notes and the instrument securing the note. NOTICE TO SELLER: Your liability to pay the note assumed by Purchaser will continue unless you obtain a release of liability from the noteholder. If you are concerned about future liability, you should use the a Release of Liability Addendum. PURCHASER: ____________________ ____________________________________________ ____________________________________________ SELLER: ____________________ ____________________________________________
Note: This addendum is only necessary if the parties have checked the option in Paragraph 4(C) above. SELLER FINANCING ADDENDUM ___________________________________________________________________________ A. CREDIT DOCUMENTATION: Within _____ days after the effective date of this contract, Purchaser shall deliver to Seller: [check all applicable items:] _____credit report _____verification of employment, including salary _____verification of funds on deposit in financial institutions _____current financial statement to establish Purchaser's creditworthiness. Purchaser hereby authorizes any credit reporting agency to furnish to Seller at Purchaser's sole expense copies of Purchaser's credit reports. B. CREDIT APPROVAL: If Purchaser's documentation is not delivered within the specified time, Seller may terminate this contract by notice to Purchaser within 7 days after expiration of the time for delivery, and the earnest money will be paid to Seller. If the documentation is timely delivered, and Seller determines in Seller's sole discretion that Purchaser's credit is unacceptable, Seller may terminate this contract by notice to Purchaser within 7 days after expiration of the time for delivery and the earnest money will be refunded to Purchaser. If Seller does not terminate this contract, Seller will be deemed to have accepted Purchaser's credit. C. PROMISSORY NOTE: The promissory note (Note) described in Paragraph 4 of this contract payable by Purchaser to the order of Seller will be payable at the place designated by Seller. Purchaser may prepay the Note in whole or in part at any time without penalty. Any prepayments are to be applied to the payment of the installments of principal last maturing and interest will immediately cease on the prepaid principal. The Note will contain a provision for payment of a late fee of 5% of any installment not paid within 10 days of the due date. The Note will be payable as follows: _____ (1) In one payment due ____________________ after the date of the Note with interest payable ___________________. _____ (2) In ____________________ installments of $____________________, [check all applicable items:] _____including interest _____plus interest beginning ____________________ after the date of the Note and continuing at ____________________ intervals thereafter for ____________________ when the balance of the Note will be due and payable. _____ (3) Interest only in ____________________ installments for the first ____________________ month(s) and thereafter in installments of $____________________, [check all applicable items:] _____including interest _____plus interest beginning ____________________ after the date of the Note and continuing at ____________________ intervals thereafter for when the balance of the Note will be due and payable. D. SECURING INSTRUMENT: [Choose the appropriate instrument authorized within the state:] A _____ mortgage, or _____ deed of trust lien, will provide for the following: (1) PROPERTY TRANSFERS: [check only one:] _____ (a) Consent Not Required: The Property may be sold, conveyed or leased without the consent of Seller, provided any subsequent Purchaser assumes the Note. _____ (b) Consent Required: If all or any part of the Property is sold, conveyed, leased for a period longer than 3 years, leased with an option to purchase, or otherwise sold, without the prior written consent of Seller, Seller may declare the balance of the Note, to be immediately due and payable. The creation of a subordinate lien, any conveyance under threat or order of condemnation, any deed solely between Purchasers, the passage of title by reason of the death of a Purchaser or by operation of law will not entitle Seller to exercise the remedies provided in this paragraph. (2) TAX AND INSURANCE ESCROW: [check only one:] _____ (a) Escrow Not Required: Purchaser shall furnish Seller annually, before the taxes become delinquent, evidence that all taxes on the Property have been paid. Purchaser shall furnish Seller annually evidence of paid-up casualty insurance naming Seller as an additional loss payee. _____ (b) Escrow Required: With each installment Purchaser shall deposit with Seller in escrow a pro rata part of the estimated annual ad valorem taxes and casualty insurance premiums for the Property. Purchaser shall pay any deficiency within 30 days after notice from Seller. Purchaser's failure to pay the deficiency constitutes a default under the securing instrument. Purchaser is not required to deposit any escrow payments for taxes and insurance that are deposited with a superior lienholder. The casualty insurance must name Seller as an additional loss payee. (3) PRIOR LIENS: Any default under any lien superior to the lien securing the Note constitutes default under the deed of trust securing the Note. PURCHASER: ____________________ ____________________________________________ ____________________________________________ SELLER: ____________________ ____________________________________________
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