Contracts
In Hawaii, a 'novation' occurs when:
AA. A new addendum is added to an existing contract
BB. The original contract is replaced by a new contract, substituting a new party or obligation✓ Correct
CC. The parties agree to extend the closing date
DD. The earnest money is increased after the home inspection
Explanation
Novation replaces an original contract with a new one, often substituting a new party. For example, when a buyer assumes a loan with lender approval, releasing the original borrower, novation occurs.
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