ContractsIntermediateCalifornia Exam

What is an 'addendum' in a real estate contract?

AA document that voids the original contract, under standard California purchase contract terms
BA document that modifies or adds terms to the original contractCorrect
CA contingency that automatically expires, as typically drafted in a residential purchase agreement
DA separate agreement for personal property, consistent with common contract law principles

Why A document that modifies or adds terms to the original contract Is Correct

Answer B: A document that modifies or adds terms to the original contract

An addendum is a document attached to and made part of the original contract that adds to or modifies its terms. Both parties must sign an addendum for it to be legally effective.

Exam Tip: Contracts

Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.

Key Contracts Terms in This Question

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