Contracts
A 'right of first refusal' clause gives the holder:
AThe right to purchase the property before the owner can accept any other offer
BThe right to cancel any offer made by a third party
CA guaranteed purchase price for a specified period
DThe right to match any offer the seller receives before the seller can accept it✓ Correct
Explanation
A right of first refusal gives the holder the right to match any bona fide third-party offer the seller receives. If the holder matches the offer, they can buy the property.
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Key Terms to Know
Right of First Refusal
A contractual right giving a party the opportunity to match any offer received before the owner can accept it from a third party.
Option ContractA 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.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
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