Farewell to the Contingent Sale Addendum

QUESTION: If a buyer indicates that they need to sell their home in paragraph 5(b) of the Offer to Purchase and Contract (Form 2-T) in order to complete the purchase, are the parties also required to attach and execute the Contingent Sale Addendum? If not, how should the parties structure the contract when the buyer needs to sell their home before they can complete the transaction?

ANSWER: The Contingent Sale Addendum is not required in these circumstances, and as of July 1st, 2019, the Contingent Sale Addendum will no longer be an available form.

Agents are strongly encouraged to examine paragraph 5(b) in the revised Form 2-T, which will also be available July 1st. Some components of the former Contingent Sale Addendum have been incorporated into the revised Form 2-T, including the buyer’s disclosing whether their property is under contract, or if their property is not under contract, whether the buyer is working with a listing firm to market the property. Brokers should understand, however, that incorporating these items into revised Form 2-T DOES NOT make the transaction contingent on the buyer’s selling their property.

A more detailed explanation for this change appears in this year’s summary of forms changes, which is available at ncrealtors.org. In transactions going forward, brokers should speak with their clients about what contract terms are reasonable when the buyer needs to sell their home. This includes how long the due diligence period will be, how much earnest money should be negotiated, and what due diligence fee should be paid. Careful negotiation of these terms, among others, should allow the buyer enough time to complete their transaction, provide the seller with a reasonable time frame for settlement, and assure that the parties will be adequately covered if the transaction is terminated.

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