A Mesa buyer's inspection reveals significant plumbing issues estimated to cost $8,000 to repair. The buyer paid $450 for the inspection. Under Arizona law, if the buyer cancels due to the inspection contingency, who typically pays for the inspection cost?
Correct Answer
B) The buyer bears the inspection cost
In Arizona, buyers typically bear the cost of inspections they order, even if they cancel based on inspection results. Option A is incorrect as sellers are not required to reimburse inspection costs unless specifically negotiated. Option C is incorrect as cost-splitting is not standard practice. Option D is incorrect as brokerages don't typically pay client inspection costs.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
Offer and acceptance is the process by which one party proposes specific terms for a contract and the other party agrees to those exact terms, creating mutual assent. This mutual agreement, also called a meeting of the minds, is an essential element of every valid contract.
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