What is a Sale of Buyer’s Property Addendum?

This form ‐ also called a Hubbard Contingency or “kick out” clause – can be used when a purchase and sales agreement is contingent on a buyer selling his/her home or other real estate.

Can the seller continue to market the property after signing a Sale of Buyer’s Property Addendum?

Yes, this Addendum allows the seller to continue to market his/her home to other buyers and kick out the original buyer until the contingency has been waived or met.

Can a listing remain in Active (AA) status in MLS after the buyer and seller have signed a purchase and sales agreement that is subject to the buyer selling his/her real estate?

No. State‐Wide Multiple Listing Service requires the use of Active Under Contract (AUC) status when a property is under contract to avoid misleading potential buyers.

Can “subject to the sale of buyer’s home” be included in the Additional Provisions of the Purchase and Sales Agreement instead of or in addition to using a Hubbard?

Yes, but whether it’s a good idea depends on whom the real estate licensee represents in the Using a Sale of Buyer’s Property Addendum on its own allows the seller to potentially bump the buyer for a better opportunity. Adding language to “Additional provisions” gives a buyer more protection by preventing a seller from terminating the original purchase and sales agreement if the seller finds a new buyer.

What happens if the seller receives an offer from another buyer that the seller wishes to accept?

The seller would send the buyer a Notice to Buyer to Waive Sale of Buyer’s Property Contingency. If the buyer does not waive the contingency, the purchase and sales agreement between the buyer and seller will become null and void, and the buyer’s deposit will be refunded.

What must the original buyer do to waive the Sale of Buyer’s Property Contingency?

The buyer must sign and deliver a Waiver of Sale of Buyer’s Property Contingency to the seller along with one of the following: (1) a preapproval or commitment letter that is not contingent on the sale of the buyer’s property; (2) written proof that the buyer has the funds or other assets to purchase the seller’s property without the sale of the buyer’s property; or (3) a fully executed purchase and sales agreement for the sale of the buyer’s property.

How much time does the buyer have to waive the Sale of Buyer’s Property Contingency?

The Demand for Waiver period starts once the seller delivers a Notice to Buyer to Waive Sale of Buyer’s Property Contingency. If the buyer wants to waive the Contingency, the buyer must respond within 72 hours or whatever period of time the buyer and seller agreed to in the Sale of Buyer’s Property Addendum.

If the new offer is higher, must the original buyer agree to match it?

The original buyer is not required to increase the purchase price. The original purchase and sales agreement would remain in effect if the buyer complies with the waiver requirements.

Can the seller bump a Hubbard with a Hubbard?

The seller can bump the original purchase and sales agreement with a purchase and sales agreement that also includes a Sale of Buyer’s Property Addendum, unless the original buyer complies with the waiver requirements. A seller may prefer the new offer because the new buyer may already have his/her own home under contract while the original buyer has just listed it.

When do the Inspection Contingency and Mortgage Contingency start if there is a Sale of Buyer’s Property Addendum?  

The buyer and seller can agree to contingencies that are triggered by the last signature on the purchase and sales agreement between the buyer and seller or on the purchase and sales agreement between the buyer and the individuals who are buying the buyer’s property.