Contracts
In NC, the 'due diligence fee' in the Offer to Purchase is best characterized as:
AA deposit toward the purchase price
BCompensation to the seller for taking the property off the market during the due diligence period✓ Correct
CA penalty for the buyer if they terminate
DA refundable good faith deposit held in escrow
Explanation
The NC due diligence fee is paid directly to the seller (not held in escrow) as compensation for taking the property off the market. It is earned by the seller upon acceptance and is non-refundable regardless of the reason for termination.
Related North Carolina Contracts Questions
- The Offer to Purchase and Contract in North Carolina is a standardized form jointly approved by which organizations?
- Under the NC Standard Form 2-T, the 'Due Diligence Fee' is paid:
- The 'due diligence period' in the NC Offer to Purchase and Contract allows the buyer to:
- Under the NC Offer to Purchase, if a buyer terminates AFTER the due diligence period without a valid contractual reason, what happens to the earnest money deposit?
- An option contract in North Carolina:
- A NC real estate contract becomes 'binding' when:
- In North Carolina, which contract form is most commonly used for residential real estate transactions?
- A NC buyer submits an offer with a 15-day due diligence period and a $5,000 due diligence fee. On day 10, the buyer discovers the foundation has serious cracks costing $40,000 to repair. The buyer should:
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