Realtor asked me to sign ADDENDUM for my share of current 2nd loan. How should it read?

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Realtor asked me to sign ADDENDUM for my share of current 2nd loan. How should it read?

I currently have a bid for a house in California that has a 2nd loan lien on it. Seller has an outdated offer from bank to settle debt for much less amount. They were not able to come up with entire amount and now i’ve been asked to contribute and I am willing. Should I ask to get a current debt settlement contract from bank? If I sign addendum, am I obligated to give money regardless of Banks answer? How can I protect myself from just handing over money without any guarantees?

Asked on May 27, 2009 under Real Estate Law, California

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

First thing, you need to get an updated letter from the bank.  You can't sign anything until you can see what the current status of the 2nd loan is.  And you are right to be concerned about just handing over your money without some form of protection.

There should be side agreements in place to protect your interests.  Frankly, I wouldn't go any further in this transaction without consulting with an attorney on this.  Find one that specializes in real estate law and run this all by them.  They will best be able to advise you on how to fully protect your legal rights.

Best of luck.


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