During a private treaty sale, a buyer makes an offer subject to finance approval within 14 days. The vendor accepts the offer. What happens if the buyer cannot obtain finance within the specified timeframe?
Correct Answer
B) The buyer can withdraw without penalty, having made genuine attempts to obtain finance.
Finance clauses are designed to protect buyers who cannot obtain suitable financing. If the buyer has made genuine efforts to secure finance and can provide evidence of this, they can typically withdraw from the contract without penalty and have their deposit returned.
Why This Is the Correct Answer
A finance clause is a condition of the contract. A buyer who has genuinely tried to obtain the loan and cannot may end the contract within the time and in the manner the clause sets, and the deposit is refunded.
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