US Home sale addendum

It is in your best interest to work closely with your broker and the vendor to find a buyer for your home. The vendor’s Home Sale Program is designed to help you market your home effectively.

The vendor provides continuous support in marketing your home, evaluating offers and advising you during negotiations.
Closing your home sale through a carefully structured program called the Buyer Value Option provides the opportunity for tax advantages for Citadel and you.

As soon as you and your family are ready to begin marketing your home, the Consultant will be available seven days a week to assist in marketing your home.

To be eligible for the Home Sale program, your home must meet the following criteria:

The residence is a one-family or two-family home, townhouse or condominium.
The home is your primary residence on the effective date of the transfer, and you are currently living there.
You are owner of the property, and you have good and marketable title to the property.
Your home cannot be tenant occupied at ANY time while listing/marketing your home sale.
The residence is in good and marketable condition.
The residence is not presently under renovation.
You know of no hidden or latent defects for which you might later be held responsible.
The property is less than five acres.

Some properties may not qualify for the home sale program. The following list is not all inclusive, but will give you some common examples:

Homes valued at $3,000,000 or more
Cooperative apartments
Mobile homes and/or trailers
Residences that require an association’s approval of purchaser
Secondary tracts of land
Farm properties
Homes with structural problems to the extent they are deemed, by a qualified structural engineer, to be unsalable
Homes that are ineligible for standard financing
Any home built with synthetic stucco; LP, composite, or masonite siding (unless remediated); or containing any other materials which are involved in, or could be potentially involved in, a class action lawsuit
Homes with excessive levels of hazardous substances
Vacation homes
Investment properties
Income producing, including residential tenancy
Apartment buildings

After the initial interview, your Consultant will order two Broker’s Market Analyses of your home and review them with you thoroughly. A Broker’s Market Analysis (BMA) is performed by a real estate broker on the basis of his or her knowledge of the current real estate resale activity in the community. Each Analysis will compare your home with other similar, recently sold homes to attempt to answer the question:

“What will the home sell for in the next three to four months, as is, with usual financing for the area?”

The average value of the BMAs can be used as the basis for the initial listing price for your home under the Home Sale Program. It is recommended that the home be listed for no more than 5% over the average of the two BMAs’ most probable sales price. This guideline may help you obtain a quick sale of your home. In addition, interviewing two agents will help you select someone you feel best meets your needs and offers the best marketing plan to list the home.

You may want to list your home with one of the brokers who provides a BMA, but you are not required to do so. Talk over your broker preferences with your Consultant. If you wish to consider additional brokers, your Consultant will provide referrals. You are free to choose a broker or agent you already know, subject to approval by the vendor. Approval must be granted before you take any action regarding the price, terms and service requirements of the listing. The broker or agent you select is extremely important to achieving the highest possible resale price in the shortest time, so please choose carefully.

After you have chosen a broker or agent, you will be asked to sign a listing agreement. Be certain that the following “Exclusion Clause” is included as a signed addendum to your listing agreement:

“It is understood and agreed that regardless of whether or not an offer is presented by a ready, willing and able buyer:

(1) That no commission or compensation is earned by, or is due and payable to, broker until sale of the property has been consummated between seller and buyer, the deed delivered to the buyer and the purchase price delivered to the seller; and (2) That the seller reserves the right to sell the property to our vendor or any other person(s) designated by them (individually and collectively a “Named Prospective Purchaser”) at any time upon which this listing agreement shall terminate without obligation by the vendor or the parties to this agreement and no commission or compensation will be due.”

The exclusion clause must be attached to the listing agreement as a signed addendum. This clause will prevent Citadel from paying the listing broker double commission when the home is sold.

The commission should not exceed six percent without approval in advance by your employer.

The term of any listing agreement should not exceed 90 days. Your Consultant may recommend a shorter term under some circumstances.

Establish a realistic list price for the home. Your Consultant will offer advice on the best listing and selling prices, based on current market data provided by real estate professionals in the community. You are encouraged to participate in this process by providing relevant data to the brokers chosen to assess value. The advantages of a competitive listing price will be explained fully by your Consultant.

You must complete a home sale disclosure statement. Every home seller has certain duties and obligations to a buyer, including full disclosure of all pertinent information about the condition of the home and its surroundings. If the vendor inadvertently or without proper disclosure information purchases a home ineligible for the home sale program, and Citadel incurs a loss as a result of your omission or misrepresentation of information, you must repay Citadel any current and future out-of-pocket expenses, and/or fines paid or to be paid by Citadel with regard to the property.

Your Consultant will work directly with the real estate broker to monitor progress in marketing your home. The Consultant will make constructive suggestions and note any market activity that might impact the sales strategy. You will be contacted regularly by the Consultant to discuss current information and revise the sales strategy as needed. You are encouraged to carefully evaluate these recommendations, but you are not required to accept them.

You must not sign any purchase offers or accept any earnest money. Your Consultant will instruct you on how to proceed.

You should contact your Consultant immediately when you receive any offer to purchase your home. Your Consultant is available by phone toll-free during office hours or after hours by calling the number listed on his or her business card, and he or she will tell you what to do if the offer is acceptable to you.

Signing any purchase offer or accepting any earnest money deposits from a buyer or broker will place your home sale benefit at risk. If an offer from a buyer is acceptable, the vendor will sign the contracts. The vendor’s obligation to you and Citadel is to determine if the buyer is qualified and if the offer is bona fide before approving the contract.

It is important to proceed with care because some costs may not be reimbursable. If the buyer’s contract would require the seller to pay any concessions or buyer’s expenses at closing, and you agree to those terms, those costs will be deducted from your equity. The following list provides guidelines for consideration as you negotiate; however, you should consult with the vendor if there is any question about whether a cost will be paid under Citadel’s policy.

Citadel Will Pay
(if normally required of seller)

Document preparation fees Survey fees
Mortgage release fees Recording fees
Transfer taxes
Title insurance
Closing and legal fees
Escrow fees
FHA/VA fees (required by seller) Attorney fees, if an attorney is required to handle the actual closing
Termite or pest inspection
Radon inspection or warranty, if necessary
Normal and reasonable real estate broker’s commission (not to exceed 6% of purchase price, unless approved in advance by Citadel)

Citadel Will Not Pay

Discount points (FHA, VA or conventional)
Escrow
Insurance
Utility bills
Property taxes
Rent
Seller concessions included in the contract with the buyer, including buyer’s closing costs, repairs, remodeling, restoration or renovation of any kind
Expenses to remedy and bring to acceptable standards hazardous conditions in the home, such as:
- Radon gas
- Friable asbestos
- Lead-based paint
- Urea formaldehyde foam insulation
- Underground storage tanks containing toxic materials
- Similar environmental hazards

Buyer Value Option (BVO) is a procedure that will be used when you find a buyer for your home. Under the Buyer Value Option program, the sale of your home progresses through two separate, arm’s length transactions:

The vendor purchases the home from you at the same net price and terms as the bona fide offer that you have received from a buyer (the Buyer Value). Once the sale to the vendor closes and you vacate the home, you receive your equity and are no longer responsible for the home.
The vendor, as the owner of the property, sells the home at the previously offered price to the buyer who made the offer. If something should happen to prevent this second sale from taking place, you are not affected.

Because the vendor, on behalf of Citadel, is buying your home based on the value of the offer you have received, the vendor must be sure that the offer is bona fide, and that the buyer is ready, willing and able to purchase your home. Your Consultant will work closely with you and your broker as you consider any offers to be sure that the terms will be acceptable.

In order for an offer to be eligible for the Buyer Value Option program, it must meet certain requirements, including:
The contract of sale from the buyer must specify a closing date that is within 60 days of the contract date.
The contract must not be contingent on the sale of the purchaser’s home. It can, however, be contingent on a closing scheduled to occur within thirty (30) days of the contract date.
The contract must not contain other contingencies, with the exception of inspections and buyer’s approval for financing.

If the vendor cannot accept the contract of sale because the buyer is not qualified with a bona fide offer, you must continue to market the home.

When an acceptable offer to purchase the home has been received, documents previously sent by the vendor will require immediate attention. The documents will include a contract of sale between you and the vendor, certain financial information forms and a general warranty deed that will subsequently be used by the vendor to convey title. Your Consultant will offer specific advice as required, but you (and your spouse, if applicable) should plan to execute the documents as soon as possible before a Notary Public and return them to the vendor. It will not be necessary for you to attend the closing of the sale.

You will receive your equity directly from the vendor when the Contract of Sale documents are signed and the property is vacated, whichever is later. Payment will be by either check or electronic transfer. You will also receive a detailed equity statement by email, mail, or fax explaining every adjustment to the equity. In general, the equity will be calculated as shown on the following page.

To determine the total net cash value of any transaction on the home under the program, first add together:

The purchase price appearing in the vendor’s contract of sale, wherein you are the seller and the vendor is the purchaser.
Any amounts you have prepaid for which you are entitled to receive aprorated refund, such as interest and taxes, but excluding home casualty insurance.

Then subtract from the above the total of the following amounts (if any) that are applicable:

All outstanding indebtedness (mortgages, taxliens, judgments, etc.)
Charges for prorated items such as interest and taxes through the effective date of the contract of sale between you and the vendor or through the vacate date, whichever is later.
Concessions to which you agreed as the seller.
Costs for deferred maintenance/repairs to becompleted before home can be purchased.
A vacate holdback of $500, refundable to you after you have permanently vacated the property and the vendor has verified property condition

The difference is:
The net equity under the Company relocation program.

The sale price in the Contract of Sale between you and the vendor will reflect the cost of ownership of the home (property insurance, taxes, utilities, maintenance and interest on the mortgage) through the effective date of the contract of sale between you and the vendor or the vacate date, whichever is later. The equity statement from the vendor will provide a detailed accounting of your home sale transaction.

It is acceptable to cancel your property insurance as of your vacate or acceptance date, whichever is later. However, for liability purposes the vendor advises your property insurance remain in effect until your new policy is in force. It is your responsibility to contact your insurance carrier to advise of cancellation.

Your Consultant will advise you when to discontinue making mortgage and other payments. If you have arrangements with any lender for payments to be automatically deducted from your account, it will be your responsibility to cancel the automatic draft(s) as of your acceptance or vacate date whichever is later. It is imperative you discuss with your relocation Consultant when to send this form to your lender. If you fail to cancel your automatic draft(s), refunds for overpayments will be delayed until after closing.

If you vacate prior to closing, your real estate broker will make arrangements to pick up your house keys, warranties, garage door opener controls and other such necessities. Your Consultant will notify you when to transfer utilities to the broker’s name, but do not request the utilities be turned off as this will result in reconnect charges. Please be sure to contact the utility companies to provide your forwarding address for your final bills.

Regardless of whether you vacate before or after closing, it will be necessary to leave the home in cleanly swept condition. In order to avoid paying additional cleaning charges later, the home must be clean and you must remove all personal property, trash or debris. Cleaning charges will be withheld from the refund of your “vacate holdback” (item 5 in the Guide for Calculation of Equity, above) if necessary.

Tax Liability

This benefit is not reported as gross earnings, and no gross-up is necessary provided the home sells under the Buyer Value Option program. However, if you fail to comply with the requirements of the Buyer Value Option, covered expenses will be reported as gross earnings and appropriate taxes will be withheld at the supplemental rates. No gross-up for tax liability will be provided.

Equity will be disbursed (minus $500 holdback) when you have met all the requirements for the Home Sale Program:

You have a bona fide offer on your home and all contingencies have been met (with the exception of buyer’s written mortgage approval)
Repairs have been completed and receipts have been provided to your Consultant
All appropriate contracts have been signed with the vendor
You have vacated your home

The $500 holdback will be refunded to you after you have permanently vacated the property and the vendor has verified property condition

Tax Liability
This benefit is not reported as gross earnings, and no gross-up is necessary

If you are not able to sell your home for at least the amount you originally paid for it, Citadel is prepared to assist you. Loss on Sale is defined as the difference between the original amount you paid for the home, less the current selling price of the home. 100% of the loss on sale will be covered up to a maximum of $50,000. Capital improvements and loss due to personal neglect will not be considered in the calculation of the loss on sale.

You must provide proof of the original price you paid for the home, such as the closing statement or similar documentation.

Under no circumstances should a real estate agent, prospective buyer, or any other individual associated with the sale of the home be advised that the Company will reimburse you for a loss on sale.

To be eligible for the Loss on Sale benefit, you must use an vendor-referred broker to sell your home.

Tax Liability
This benefit is reported as additional gross earnings and the amount is grossed up to help offset additional taxes

Home Sale Program – Introduction

Step-by-Step Guide to the Home Sale Program