Contracts
An option contract in real estate gives the optionee:
AAn obligation to purchase the property within a set time
BThe exclusive right, but not the obligation, to purchase property at a set price within a set time✓ Correct
CThe right to lease the property for a fixed term
DAn irrevocable offer that both parties must honor
Explanation
An option contract gives the optionee (buyer) the exclusive right — but not the obligation — to purchase a property at an agreed price within a specified time period. The optionor (seller) is bound during the option period; the optionee is not.
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Key Terms to Know
Option Contract
A contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
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