tombstoneSeller Protection in a Short Sale

I have received a few comments where the Seller received short sale approval from the lenders(s) but at terms the Seller could not accept.  For example the lender refused to ‘release’ the seller from future liability.  See my blog on Short Sale Release Language.  To protect your seller, make the agreement contingent upon your selling client receiving a full release from any future obligations from the lenders.  The current Addendum to the Short Sale declares, that the “Purchase Agreement is contingent upon Seller and/or Seller’s Agent obtaining approval from Lender (“Lender Approval”) to accept an amount less than what is owed on the Property,” page 1, Paragraph 1, line 15.

 What you should say, “The contingency of paragraph 1, page 1 shall not be met until all terms and conditions of Lender Approval are approved by the Seller, at Seller’s sole discretion, and shall include the Seller being released from any future liability from all parties with a vested interest in the forgiven debt.

The Greater Las Vegas Association of REALTORS® has not yet changed the language on their form, and they may not.  Therefore I added it on paragraph 11, automatically here .  If it is not required it can be removed.

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