MetroTex NEWS

Information concerning the use of COVID-19 Addendum (TXR-2520)

The addendum is available for use now  and will also will be publishing the form on texasrealestate.com on the coronavirus page as well as on the blank forms page. Forms vendors will have the form as well
Note: Use of the COVID-19 Addendum is not mandatory and may not be appropriate in all circumstances. Depending on the goals and needs of the parties, use of an existing form may be more appropriate when dealing with COVID-19-related issues. For example:
 
• If the parties want to negotiate an extension to the closing date to a definite date, they may use the Amendment (TXR-1903) form, filling in the new date in paragraph 3.
• If the parties want to negotiate an extension to the time the buyer has to obtain buyer approval under the Third Party Financing Addendum, they may also use the Amendment (TXR-1903) form, filling in the new date in paragraph 7.
• If the parties want to terminate the contract, they may use the Release of Earnest Money (TXR-1904) form, which releases the parties from any and all liability under the sales contract. The parties may also agree how the earnest money will be dispersed.
The COVID-19 pandemic is causing unprecedented impact and uncertainty for Texas real estate transactions. Voluntary and mandatory quarantines and the closure of government and private offices may impede the ability of parties to successfully fund and close transactions.To address these uncertainties, Texas REALTORS® has created the COVID-19 Addendum (TXR-2520). The COVID-19 Addendum provides for a 30-day extension of the closing date in a residential sales contract if the closing cannot occur due to a voluntary or mandatory COVID19 quarantine or closure. If the closing cannot occur after the 30-day extension, either party may terminate the sales contract with the earnest money being returned to the buyer. The COVID-19 Addendum also permits either party to terminate the sales contract, with the buyer receiving the earnest money, if the buyer is unable to fund their loan beyond the time provided in the Third Party Financing Addendum due to loss of income from a COVID-19-related issue.
 
The 30-day extension under the addendum is available if the delay in closing is due to a quarantine or closure that affects the buyer, seller, or other service provider, including, but not limited to, a title company, lender, inspector, or appraiser.
 
The COVID-19 Addendum may be used as an addendum to a new contract or to amend a currently executed contract. The addendum may be used in conjunction with the following residential sales contracts:
 
• One to Four Family Residential Contract (Resale) (TXR-1601)
• New Home Contract (Incomplete Construction) (TXR-1603)
• New Home Contract (Completed Construction) (TXR 1604)
• Residential Condominium Contract (Resale) (TXR-1605)
• Unimproved Property Contract (TXR-1607)
• New Residential Condominium Contract (Completed Construction) (TXR-1608)
• New Residential Condominium Contract (Incomplete Construction) (TXR-1609)
 
Due to the uncertainty caused by COVID-19, buyers and sellers should be especially attentive to timelines in the contract in order to be in the best position to perform their contractual obligations or extend the deadlines as necessary.