Contracts
If a buyer defaults on a real estate purchase contract, the seller's typical remedy may include:
AOnly recovering earnest money
BRetaining earnest money, suing for damages, or seeking specific performance✓ Correct
CAutomatically voiding all prior agreements
DFiling a complaint with AREC
Explanation
When a buyer defaults, the seller may retain the earnest money as liquidated damages (if the contract so provides), sue for actual damages, or seek specific performance requiring the buyer to complete the purchase.
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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.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
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.
Math Concepts
State-Specific Concepts
AREC Regulation
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