Is anyone NOT signing the BOA addendum?

I know there was a discussion about this addendum recently, but I can't find it.  I THOUGHT I saw someone say they just weren't signing it.  Has that worked? 

 

I got an addendum from BOA last week and the dual agent part was removed, but this addendum overall is crazy.  It states it SUPERSEDES the purchase contract too. 

 

That means my paragraph on automatic 30 day extension if title isn't cleared can't happen. Supersedes the purchase contract?  That would actually mean my purchase contract is NOT valid.  Shouldn't it say SUPPLEMENT?

 

It also states no alterations, modifcations ...are valid unless signed by FHA, VA, government agencies, etc.  I mean if I increase the price and the buyer and seller agree, I have to wait for the FHA, VA or other agencies to sign it??  It makes NOOOOOOO SENSE the way it's written.

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Permalink Reply by Smitty on July 3, 2011 at 3:27am

Tni, have you flat out refused to sign it and gotten an BOA sale approved?  OR did you change what you didn't agree with and then have it approved?

 

 

Permalink Reply by Tni LeBlanc (805) 878-9879 on July 3, 2011 at 4:01am

Refused, been instructed by them to modify after my objection, and I've modified it on my own.


Smitty said:

Tni, have you flat out refused to sign it and gotten an BOA sale approved?  OR did you change what you didn't agree with and then have it approved?

 

 

Permalink Reply by TC Bland on July 3, 2011 at 4:25am

Good for you Tni, below are comments from John Grant regarding banks attempting to make themselves "parties" and overstepping their authority.

In the simplest terms, to be a party to a contract, you must meet certain criteria in most states.  Some of the basics are that you must be of legal age, and you must be competent.  One of the other issues is that the party must have "standing" for a legal contract.  For example, I could enter into a contract, as seller, to sell your house.  Do I have standing to sell your house ?  No.  Would that contract be legal ? No.
 
In a purchase and sale agreement, the parties are the buyer and the seller.  The seller must have the legal authority to sell the property (ie.  owner of record, trustee, estate executor, etc.).  Since the banks do not own the property when doing a short sale, they cannot be an actual party to the contract.  They have approval authority over terms of the discounted payoff, but are not a party.  The big issue in my eyes is that they are moving beyond simply approving the discounted payoff, but are inserting themselves into terms and conditions of the contract that are outside of their legal scope of control.
 
The problem is that our goal is to get short sales completed and closed.  Until someone is willing to take these lenders "to the mat" and either sue them over their gross overstepping of their authority (where is the ACLU when a homeowner needs them), or to get state or federal legislation (or regulatory policy) passed limiting the bank's authority in these situations, they will continue to overstep their bounds.  Right now, they are the 800 lb gorilla who is saying "I don't care if I have the authority to do this or not, you will comply with my demands, or I will not approve this short sale".
 
Hmmmmm, with that said, maybe we should be looking up the legal definition of "extortion"
rather than "party to a contract". 
 
Thanks for letting me rant !  Happy Independence Day to All !

John H. Grant, REALTOR
Permalink Reply by Beatrice M. Stambulski on July 3, 2011 at 1:30pm

Couple of weeks ago I had a Short Sale let go to Auction. The only reason I can think of is due to this Addendum. Everything was going well until this Addm came into picture. Both Buyer and Seller, including the agents signed it. When I submitted it to BofA I wrote a note stating that the Purchase Contract and Short Sale addendum are the binding documents to the transaction even though this Addm. was signed by all parties, only as an acknowledgment. When I spoke with the Negotiator specifically about the content including the commissions, he said " it is absolutely absurd for BofA to deny the commissions " When I pressed for legality and pointed at specifics of the Addm he said he can not legally advise to how this Addm is to be interpreted or maybe I even read too much into it (?!) What? Contacted my legal dept and CAR legal hot line, they all agreed that the addendum means what it states.This is a revised Addm that has been introduced this year, that gives BofA the leeway, at any time can say we do not pay for anything and for agents' commissions here is $1000 as a token for your efforts. You do not sign it, Short Sale denied. If anyone can get a Short Sale through without this Addm signed, would love to hear about it.

Permalink Reply by Walt Dexter on July 3, 2011 at 5:01pm

 

The Parties acknowledge and agree that this Addendum together with the Sales Contract shall constitute the entire and sole agreement between the Parties with respect to the Sale of the Subject property and supersede any prior agreements, negotiations, understandings, optional contracts, or other matters whether oral or written, with respect to the subject matter hereof. 

I am not a lawyer, but are you guys just not reading this right?

 

The subject for the verb "shall" is not "this Addendum" - it's "this Addendum together with the Sales Contract."

 

So far as I can see, all this says is that the combination of the addendum and the sales contract makes up the entire agreement, and any other thing that any of the parties may pull out - whether verbal or written - is agreed to not apply.

 

BofA probably wants this to simplify their processes - they don't want countless one-off agreements to have to try to deal with, they want everything written into the sales contract and the addendum. And they've probably been burned by people claiming verbal agreements.

Permalink Reply by Jayne Sanders on July 4, 2011 at 3:20am

Smitty...I think the bank has forgotten this is a short sale ..not an REO(where they are the Seller)

They have just replaced both forms and took out the part about dual agency on the agent form and took out the 90 day resale time on the buyer/Seller addendum...I tried lining out the parts about the agent and they rejected the form....Maybe we ned to be more vocal with NAR as they seem to be in communication with B of A. Why don't we all just send emails to NAR...the squeeky wheel gets the oil. We are not going to change anything by complaining here....

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Permalink Reply by Smitty on July 5, 2011 at 6:57am

Walt, did you read this whole thread?

That whole paragraph doesn't make sense. 

The Parties acknowledge and agree that this Addendum together with the Sales Contract shall constitute the

entire and sole agreement between the Parties with respect to the Sale of the Subject property and supersede

any prior agreements, negotiations, understandings, optional contracts, or other matters whether oral or written,

with respect to the subject matter hereof. To the extent that any term or condition contained within the Short

Sale Contract is contradictory or inconsistent with this Addendum, the Parties agree that this Addendum shall

supersede. No alternations, modifications, or waiver of any provision hereof shall be valid unless in writing and

signed by Parties, FHA, VA, government agencies, any Investor, and/or mortgage holder, hereto."

It SUPERSEDES PRIOR AGREEMENTS then it TAKES PLACE OF PRIOR AGREEMENTS ?!?!?!?!   It cannot supersede it.  It can be a supplement.  It then goes on to say that any term within the SHORT SALE CONTRACT is contradictory... WHAT SHORT SALE CONTRACT?  Do they mean sales contract?  That's what they referred to in the entire rest of the addendum.

Then the last line is ridiculous.  So if I change the purchase price, I have to get in writing from FHA, VA, governmnet agency..blah blah?????  It's not possible. I can have the buyer and sellers agree and sign off, but this addendum is a joke.

Permalink Reply by Walt Dexter on July 5, 2011 at 3:20pm


I don't know that I've read every comment in the thread. Don't think that's really relevant.

 

Honestly I didn't understand what you were so excited about until I did some reading about  the legal usage of the word "supersede." It basically means replace. The first "supersede" (... property and supersede any prior agreements...) still makes perfect sense to me. The second one is almost certainly incorrect.

 

I am not a lawyer, this is not legal advice, etc. etc. but...

The Parties acknowledge and agree that this Addendum together with the Sales Contract shall constitute the entire and sole agreement between the Parties with respect to the Sale of the Subject property and supersede any prior agreements, negotiations, understandings, optional contracts, or other matters whether oral or written, with respect to the subject matter hereof. 

The set of documents made up of the Addendum and the Sales Contract is the whole agreement, no matter what the parties may have thought they agreed to that isn't in those documents.

To the extent that any term or condition contained within the Short Sale Contract is contradictory or inconsistent with this Addendum, the Parties agree that this Addendum shall supersede.

If the short sale contract and the addendum are in conflict, the addendum (which BofA lawyers wrote) wins. That's a fairly common concept when tacking an addendum onto something. If they're in agreement it doesn't matter, and if the matter is only addressed on one it doesn't matter. This doesn't say the addendum supersedes the Sales Contract in its entirety; it says that to the extent that they conflict, the addendum wins.

 

The language should say what it's superseding. Unless there's a document called a "Short Sale Contract" it should say "Sales Contract" like it does everywhere else.

 

As I said above, "supersedes" probably isn't the right word to have used.

No alternations, modifications, or waiver of any provision hereof shall be valid unless in writing and signed by Parties, FHA, VA, government agencies, any Investor, and/or mortgage holder, hereto.

Not real sure here... they need to be clearer on what they're saying for sure. I'm not sure if "hereof" refers to the addendum or to the whole agreement, which is the combination of the addendum and the sales contract.

 

Whichever it is, it boils down to that there's no way you're going to get all those people to sign off on anything, so the thing that they're talking about cannot in any way be modified once they're signed by the buyer and seller. 

Permalink Reply by Smitty on July 6, 2011 at 1:25am
This addendum is junk no matter how you look at it.  In the opening paragraph it tries to make a broker a "party" to the contract which I think we can all agree on we are NOT party to the sales contract, AND after it tries to make us party, there is no where for us to sign on this page.
Permalink Reply by Pamela Lester on July 6, 2011 at 4:35am
The BAC addendum only supersedes inconsistent verbiage, not the contract.
Permalink Reply by Smitty on July 6, 2011 at 6:55am

That's not what it says.

It supersedes "prior agreements, negotiations, understandings, optional contracts, or other matters whether oral or written, with respect to the subject matter hereof"

The next sentence says it supersedes the "short sale contract" - WHAT short sale contract?  Do they mean sales contract? That is what they refer to in the entire rest of the addendum.

 

We shouldn't have to INTERPRET addendums.

 

This addendum literally says NOTHING. 

Permalink Reply by DeeDee Riley on July 10, 2011 at 5:43am

We have a short sale addendum that becomes part of our purchase contract in CA.  Maybe they are referring to this as the short sale contract. ????

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