A buyer's offer states that it will expire at 5:00 p.m. on Friday. On Friday at 6:00 p.m., the seller accepts the offer. Which of the following is TRUE?
Why No contract was formed — the offer expired before acceptance Is Correct
Answer B: No contract was formed — the offer expired before acceptance
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.
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Key Terms to Know
A contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
State-Specific Concepts
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