Contracts
Novation in a real estate contract means:
AThe original contract is amended with a written addendum
BThe original contract is replaced by a new contract with the same or different parties✓ Correct
CThe earnest money is forfeited by the buyer
DThe seller accepts a backup offer
Explanation
Novation is the substitution of a new contract for the original one, which discharges the old contract. In real estate, novation often occurs when a new buyer assumes a seller's obligations and the seller is released from the original contract.
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