A buyer in Phoenix submits an offer with a financing contingency that requires loan approval within 21 days. On day 18, the buyer's lender requests additional documentation that will delay approval by one week. What should the buyer do to protect their interests?
Correct Answer
B) Request a written extension of the financing contingency deadline
The buyer should request a written extension of the financing contingency deadline to protect their earnest money and maintain their contractual rights. Option A is risky as the contingency would expire, potentially forfeiting earnest money. Option C removes important buyer protection. Option D unnecessarily forfeits earnest money when an extension could resolve the issue.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An assignment of contract transfers one party's rights and obligations under a contract to a third party called the assignee. The original party, known as the assignor, transfers their contractual position to someone who was not originally part of the agreement.
A bilateral contract is an agreement in which both parties exchange promises and are both obligated to perform, while a unilateral contract is one in which only one party makes a promise and the other party is not obligated to act.
A breach of contract occurs when one party fails to perform their obligations under the contract without a legal excuse. The non-breaching party is entitled to legal remedies including damages, specific performance, or contract rescission.
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Previous Question
In a Prescott transaction review, the parties ask whether Arizona contracts can address contingencies beyond inspections, such as HOA review or the buyer's sale of another property. Which statement is most accurate under current Arizona rules?
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An Arizona buyer receives an inspection report showing an unexpected property-condition issue. What contractual protection allows the buyer to inspect and potentially cancel on that basis?