Addendum
Definition and meaning of Addendum in real estate.
An addendum is an additional document attached to an existing real estate contract that adds, clarifies, or modifies specific terms of the agreement. It becomes a legally binding part of the contract once signed by all parties.
In more detail
Unlike an amendment, which changes terms already agreed upon, an addendum is typically introduced at the beginning of a transaction to cover items not addressed in the standard contract template. Common addenda include disclosures about lead-based paint, financing contingencies, or homeowners association rules. Buyers and sellers use addenda to customize transactions to their specific needs without rewriting the entire contract.
Real estate agents frequently use preprinted addenda forms provided by state association boards to ensure compliance with local regulations.
Key facts
| Category | Buying & Selling |
|---|---|
| Also known as | Contract rider |
| Required by | Varies by transaction type |
| Legal status | Binding once signed by all parties |
A buyer submits an offer on an older home and includes a lead-based paint addendum, which grants the buyer a specified number of days to inspect the home for hazards.
Frequently asked questions
What is the difference between an addendum and an amendment?
An addendum adds new terms or documents to a contract before or during its initial signing, while an amendment modifies existing terms of a contract that has already been signed by both parties.
Can an addendum be backed out of after signing?
No, once all parties sign an addendum, it is a legally binding part of the contract, and backing out could result in a breach of contract.
Related terms
Sources & references
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