Contracts
A Nebraska buyer who backs out of a purchase agreement within the inspection contingency period and requests return of earnest money is:
AIn breach of contract and loses the earnest money
BTypically entitled to a refund of the earnest money if they provide timely written notice within the contingency period✓ Correct
CEntitled to return of earnest money only if a major defect was found
DRequired to pay the seller's relisting costs before getting the earnest money back
Explanation
A properly written inspection contingency allows the buyer to cancel and receive a refund of earnest money if they give timely written notice within the contingency period, regardless of whether a specific defect was found.
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Key Terms to Know
Earnest Money
A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
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.
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