ContractsIntermediateAlaska Exam

A seller in Alaska receives an offer that includes a request for the seller to pay $8,000 toward the buyer's closing costs. This is called:

AA seller concessionCorrect
BA down payment gift
CA compensating factor
DSeller subordination

Why A seller concession Is Correct

Answer A: A seller concession

A seller concession (or seller contribution) is an amount the seller agrees to pay toward the buyer's closing costs. Lenders typically limit the amount of seller concessions allowed as a percentage of the purchase price to prevent inflated prices.

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.

Key Contracts Terms in This Question

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