Under the NC Standard Form 2-T, the 'Due Diligence Fee' is paid:
Why Directly to the seller at contract formation, typically non-refundable Is Correct
Answer B: Directly to the seller at contract formation, typically non-refundable
Exam Tip: Contracts
Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.
Key Contracts Terms in This Question
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
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Key Terms to Know
Fees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
EscrowA neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
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