Contracts
Time is of the essence in a real estate contract means:
AThe contract must be completed quickly
BAll deadlines and dates in the contract must be strictly met✓ Correct
CThe seller must respond to offers within 24 hours
DClosing must occur within 30 days
Explanation
When a contract contains a 'time is of the essence' clause, all deadlines are strictly enforced. Failure to meet a deadline can constitute a material breach of contract.
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Key Terms to Know
Contingency
A 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.
Earnest MoneyA 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.
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