Contracts
What happens to earnest money if a buyer defaults on a North Dakota purchase contract?
AIt is always returned to the buyer
BIt may be retained by the seller as liquidated damages if the contract specifies this✓ Correct
CIt must be split equally between buyer and seller
DIt is forfeited to the state
Explanation
If a contract includes a liquidated damages clause and the buyer defaults, the seller may be entitled to retain the earnest money as liquidated damages. The specific outcome depends on the contract language.
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