Contracts
What is an option contract in real estate?
AA contract allowing the buyer to choose the closing date
BA contract giving the buyer the right but not obligation to purchase at a set price within a specified time✓ Correct
CA lease with an automatic renewal clause
DA seller's right to back out of a contract
Explanation
An option contract gives the holder the right, but not the obligation, to purchase property at a predetermined price within a specific time period. The optionee (buyer) pays consideration for this right.
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