Contracts
A Virginia purchase contract provides that 'time is of the essence' for the financing deadline. The buyer's lender needs 3 more days. The buyer should:
ALet the deadline pass and blame the lender
BRequest a written extension addendum from the seller before the deadline expires✓ Correct
CProceed to closing without the loan being approved
DReport the lender to the VREB
Explanation
With time of the essence clauses, deadlines are strict. The buyer should proactively contact the seller's agent to request a written extension before the deadline passes to avoid default.
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Key Terms to Know
Contingency
A condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
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