Document background
The Earnest Money Addendum is a critical component of Canadian real estate transactions, used whenever a deposit is required to secure a property purchase. This document is typically attached to the main purchase agreement and details specific terms regarding the handling of earnest money deposits, which vary by province. It becomes necessary when parties need to establish clear terms for deposit amounts, payment schedules, and release conditions. The addendum ensures compliance with provincial real estate regulations and trust account requirements, while protecting both parties' interests. It's particularly important in situations involving multiple deposits, specific release conditions, or when special handling of funds is required. The document must align with provincial real estate laws and regulations, making it essential to adapt the content based on the specific Canadian province where the transaction occurs.
