Who does the Short Sale Addendum protect?

The Short Sale Addendum is primarily designed to protect the seller in a real estate transaction involving a short sale. In such transactions, the seller is typically facing financial hardship and is selling the property for less than the amount owed on their mortgage. The addendum helps to ensure that the seller understands the terms and implications of the short sale agreement, including the need for approval from the lender for the sale price.

This document outlines the necessary disclosures and conditions that the seller must be aware of, which ultimately aids in facilitating a smoother transaction process. By clearly indicating the potential for the mortgage lender to accept a lower payoff amount, the Short Sale Addendum also assists the seller in negotiating with the lender and helps them understand what is required to finalize the sale. Therefore, the protection of the seller in this specific context is crucial, as they navigate the complexities of selling a property under financial duress.