Contracts
A buyer's offer of $400,000 includes an inspection contingency allowing the buyer to withdraw if inspection reveals defects costing more than $5,000 to repair. The inspection reveals $6,000 in needed repairs. The buyer may:
ANot withdraw because the contract is binding
BWithdraw from the contract under the contingency✓ Correct
CWithdraw only if the seller refuses to repair
DWithdraw only with the seller's written approval
Explanation
Because the inspection revealed defects costing more than the contingency threshold of $5,000, the buyer satisfies the contingency condition and may withdraw from the contract and recover earnest money.
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