Contracts
What is a 'right of first refusal' in a New Mexico real estate contract?
AThe seller's right to reject any offer
BA contractual right giving a party the opportunity to match any purchase offer before the owner accepts an outside offer✓ Correct
CThe right to refuse a home inspection
DA lender's right to refuse a loan application
Explanation
A right of first refusal gives the holder the right to purchase the property on the same terms as any bona fide third-party offer before the seller accepts that outside offer.
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Key Terms to Know
Right of First Refusal
A contractual right giving a party the opportunity to match any offer received before the owner can accept it from a third party.
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.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
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