Contracts
A Virginia real estate contract includes an 'escape clause' (kick-out clause). This allows the seller to:
ACancel the contract at any time for any reason
BContinue marketing the property and terminate the contract if a better offer is accepted, giving the first buyer a right to remove contingencies✓ Correct
CEscape from the commission obligation to the listing broker
DSet a new price after the contract is ratified
Explanation
A kick-out clause (escape/release clause) lets the seller continue marketing while the first buyer has a contingency. If another offer comes in, the seller notifies the first buyer, who must remove contingencies within a specified time or the contract terminates.
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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.
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.
Right of First RefusalA contractual right giving a party the opportunity to match any offer received before the owner can accept it from a third party.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
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