Contracts
In South Dakota, if a buyer backs out of a contract without a valid contingency, the seller may retain the earnest money as:
AA penalty clause payment
BLiquidated damages, if so specified in the contract✓ Correct
CA legal judgment automatically
DCompensation only if actual damages can be proven
Explanation
Many South Dakota real estate contracts include a liquidated damages clause that allows the seller to retain the earnest money as liquidated (pre-agreed) damages if the buyer defaults without a valid contingency. This must be specified in the contract to apply.
Related South Dakota Contracts Questions
- In South Dakota, which of the following BEST describes an 'addendum' to a real estate contract?
- In South Dakota, a buyer who needs more time to close a real estate transaction should request:
- In South Dakota real estate transactions, 'closing' or 'settlement' refers to:
- In South Dakota, a seller who lists a property 'as-is' cannot escape liability for:
- In South Dakota, when a seller accepts a buyer's offer 'with modifications,' this constitutes a:
- A South Dakota purchase agreement states the buyer will purchase the property 'as-is.' This means:
- An option contract in South Dakota gives the optionee the:
- In South Dakota, what is 'liquidated damages' in the context of a real estate contract?
Practice More South Dakota Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free South Dakota Quiz →