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San Diego Foreclosures and REO Real Estate Buyers Asked: What is a Covenant?

In terms of San Diego foreclosures and REO Real Estate, "a covenant is a written agreement between interested parties that helps to form the basis for some sort of ongoing business relationship." http://www.wisegeek.com/what-is-a-covenant.htm

Covenants outline the general terms of the agreement that will exist between the relevant parties. There are a few basic elements in the covenant to give the San Diego foreclosures and REO Real Estate transaction meaning and function.

 Generally a covenant will discuss the following:

• identify the parties that are entering into the agreement
• The main purpose for the creation of the contract
• How the relationship is anticipated to proceed.
• the terms of payment for the services that are being agreed upon, and
• how each party to the covenant will react in the event of an emergency situation.

Then the specific penalties in the event of the failure of any party to hold up their end of the relationship are defined.

Finally, a covenant In terms of San Diego foreclosures and REO Real Estate addresses who are the authorized parties to sign and execute the agreement.

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