Contracts
An Iowa seller wants to close quickly and accepts a buyer's all-cash offer with no contingencies. The buyer then defaults. What remedy is MOST likely available to the seller?
AThe seller can do nothing
BThe seller may retain the earnest money as liquidated damages if so specified in the contract✓ Correct
CThe seller must wait six months before re-listing
DThe seller must return the earnest money to the buyer
Explanation
Many Iowa purchase agreements specify that if the buyer defaults, the seller may retain the earnest money as liquidated damages. This must be explicitly stated in the contract.
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