Contracts
Under NJ consumer protection law, a NJ licensee who engages in 'bait and switch' advertising (advertising one property to attract buyers then redirecting to different properties) is violating:
AOnly NJREC advertising rules
BThe NJ Consumer Fraud Act and NJREC advertising regulations✓ Correct
COnly federal FTC regulations
DNo law if buyers eventually find a suitable property
Explanation
Bait-and-switch advertising violates the NJ Consumer Fraud Act (deceptive trade practice) and NJREC advertising regulations requiring truthful, non-misleading advertising. The NJ CFA provides for treble damages and attorney fees.
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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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