Contracts
A seller's agent learns the buyer's offer contains a financing contingency for an amount lower than the purchase price. The agent should:
AReject the offer since financing is insufficient
BPresent the offer to the seller with an explanation of the financing contingency implications✓ Correct
CRequire the buyer to increase their loan amount
DContact the buyer's lender directly to verify
Explanation
The agent must present the offer as written to the seller and explain the implications of the financing contingency. The seller then decides how to respond.
People Also Study
Related Arkansas Questions
- A buyer's offer is contingent on obtaining financing. The buyer is unable to qualify for a loan and properly invokes the financing contingency. What happens to the earnest money?Contracts
- Which clause in a purchase contract allows a seller to continue marketing the property and accept a better offer, giving the original buyer the right to remove a contingency or lose the contract?Contracts
- A buyer includes a financing contingency in their offer. If the buyer is unable to obtain a loan, the contingency allows the buyer to:Contracts
- A home is listed at $325,000. The buyer offers 4% below list price. What is the offer amount?Real Estate Math
- A buyer makes an offer on a property with a financing contingency. The lender denies the loan. The buyer should:Contracts
- A property has a purchase price of $750,000, LTV of 75%, and the interest rate is 6% on a 25-year loan. What is the loan amount?Real Estate Math
- Under Arkansas license law, what is the obligation of a licensee when receiving an offer to purchase that contains terms they believe are disadvantageous to their client?Arkansas License Law
Key Terms to Know
Contingency
A condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
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.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Study This Topic
Practice More Arkansas Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Arkansas Quiz →