Contracts
Under the GAR contract, the 'due diligence period' is the time during which the buyer can:
AA. Only perform a home inspection
BB. Investigate all aspects of the property (inspections, surveys, financing) and terminate without penalty if unsatisfied✓ Correct
CC. Negotiate a lower price after inspections
DD. Request extensions to the closing date
Explanation
The GAR due diligence period allows the buyer to conduct all investigations — inspections, survey, HOA review, financing, etc. The buyer may terminate for any reason during this period, typically forfeiting only the due diligence fee if included.
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Key Terms to Know
Option Contract
A contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
ContingencyA 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.
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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