What addendum is required when a seller wants to buy another home before closing on their current one?

When a seller intends to purchase another home before finalizing the sale of their current property, the correct addendum to utilize is the "Addendum for Sale of Other Property by Buyer." This addendum is specifically designed to address transactions wherein the sale of the seller's property is contingent upon the seller's ability to sell another property.

This situation commonly arises when a seller wants to avoid the financial burden of owning two houses simultaneously and ensures that they can negotiate confidently on the purchase of the new home, knowing that they will not be overwhelmed by two mortgages. By including this addendum, the seller is protected, as it lays out conditions under which the sale can be canceled or delayed if the seller’s current property does not sell in time to fund the new purchase.

Using a dedicated addendum such as this streamlines the transaction process for both parties and reflects a clear understanding of the conditions surrounding the sale. It helps manage risks associated with timing and financing when dealing with multiple properties.