Contracts
A Rhode Island purchase agreement includes a contingency stating the contract is void if the buyer cannot obtain financing at 7% or below within 30 days. This is an example of a:
ATime is of the essence clause
BFinancing contingency✓ Correct
CInspection contingency
DKick-out clause
Explanation
A financing contingency makes the contract contingent upon the buyer obtaining a mortgage loan at specified terms. If the buyer cannot obtain financing meeting those terms within the specified period, the contract becomes void and the buyer's deposit is typically returned.
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