A third party financing addendum is a form that records the loan a buyer plans to use. This addendum to real estate purchase contract is often attached to a purchase agreement so that both the seller and buyer know who is financing the sale. It’s not used if the buyer is receiving financing from the seller. It can also null the printable purchase and sale agreement if the buyer cannot receive the financing that they need to buy the home or property.
Last Updated: October 2026. This guide is reviewed and updated regularly to reflect current law. If you notice an error or outdated information, please contact us.
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A third-party financing addendum is added to the sales contract to outline the terms of the loan the buyer is using. It can be used for conventional, FHA, or VA loans. The sales contract is contingent on the buyer securing the loan for the mortgage.
If the buyer cannot receive the loan, the contract will be void. The seller will typically need to be pre-approved for the loan or the financing before they can fill out the third-party financing addendum.
The addendum does not replace the purchase agreement. It sits beside it and adds the financing details, such as the loan type and the approximate amount, in one place.
Keep the signed third party financing addendum together with your purchase agreement. That way, both documents are easy to find when a buyer, a seller or a lender asks to see them later.
There are several different types of third-party financing that are used and may require this addendum. Pick the version that matches the loan the buyer has applied for, since the details of a third party financing addendum differ from one loan type to the next.
A third-party financing addendum can be used anytime the buyer is receiving financing for a loan. It’s always a good idea to have one because it allows the buyer to terminate the sales contract if they cannot receive the proper funding.
Keep in mind that the buyer still has to give written timely notice if they are canceling the purchase agreement. Otherwise, they may be in breach of the sales contract. Most states require a notice of at least three days before closing.
If you are the buyer, let the seller know as soon as you can that you are not receiving the loan and need to cancel the sale.
The addendum may look slightly different depending on the financing that is being used and what the loan terms are. The addendum will typically have a few key components that are always included.
This is the part where the party’s names and addresses are listed. It will also have the date the addendum is being created and the day the parties agreed on the terms.
This is the area that will discuss the type of financing that is being used. It will have different details that are listed depending on the loan that has been secured.
Make sure you always indicate the amount of money the buyer is trying to receive from the loan company.
The approval of the lender is sometimes needed to gain the financing. You may need to include a section including the date that the approval is needed. You will also need to give the date that the buyer must provide to have the approval of the property. The lender will usually give them a date.
This is where the signatures will need to be concluded.
The buyer and seller will also need to print their full names and official signatures that match the original purchase agreement.
The FormsPal third party financing addendum template that this page hands out runs three pages and has 28 fillable fields, and the five steps below follow it in order. Compare each entry with your purchase agreement, so that the names, addresses and dates match.
The screenshots under each step show the FormsPal Third (3rd) Party Financing Addendum template filled with sample entries in blue, so you can see where each answer goes. The names, addresses, dates and amounts are examples only.
These answers cover the basics of the FormsPal addendum template, including the six loan types that it lists, who signs it, and how to fill in the PDF on your computer.
It is a short document that records the loan a buyer plans to use to pay for a home or property. Buyers and sellers often attach it to the purchase agreement, so that both sides can see how the sale will be paid for.
The FormsPal template has check boxes for these loan types:
Check the one that matches the buyer's loan.
The buyer and the seller each have a signature block on the last page. A name and title are printed below each signature, so that the signers can be identified.
Yes. Download the PDF from this page and fill it in with the online PDF editor, then save or print your copy.
Keep a signed copy with your purchase agreement and give a copy to the other party. That way, both sides can find the document again when they want to check the loan details.
General information, not legal or tax advice.
