Contracts
In NJ, a seller who inserts a 'kick-out clause' in an accepted contract contingent on the buyer's home sale provides for the seller to:
ATerminate the buyer's contract without any notice
BContinue marketing the property and, upon receiving a better offer, give the original buyer notice to waive the home sale contingency within a specified period (typically 48–72 hours) or the first contract terminates✓ Correct
CRaise the price if a better offer comes in
DTransfer the contract to a new buyer automatically
Explanation
A kick-out clause lets the seller continue marketing while under contract. If a non-contingent offer comes in, the seller triggers the kick-out, giving the first buyer a short window to remove their contingency.
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Key Terms to Know
Contingency
A condition in a purchase contract that must be satisfied before the sale can proceed to closing.
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.
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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