Contracts
A seller makes a counteroffer to a buyer's offer. This action:
ACreates a binding contract on the original offer's terms
BRejects the original offer and creates a new offer from the seller✓ Correct
CExtends the buyer's offer for an additional 24 hours
DRequires AREC approval before the buyer may respond
Explanation
A counteroffer simultaneously rejects the original offer and creates a new offer. The original buyer's offer is extinguished — the original offeror (buyer) is no longer bound by it.
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Key Terms to Know
Earnest Money
A 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.
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.
State-Specific Concepts
AREC Regulation
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