ContractsIntermediateAlabama Exam

A purchase contract includes a seller's right to continue showing the property. If the buyer does not remove their contingency within a specified time after receiving a backup offer notice, the contract:

AAutomatically extends for 30 days
BMay be terminated by the seller to accept the backup offerCorrect
CBecomes void without any action
DMust be referred to AREC for resolution, under this approach

Why May be terminated by the seller to accept the backup offer Is Correct

Answer B: May be terminated by the seller to accept the backup offer

Under a kick-out (release) clause, if the buyer fails to remove their contingency within the required timeframe after receiving notice of a backup offer, the seller may terminate the contract and accept the other offer.

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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