A Connecticut real estate licensee is advising a seller client about contingencies that buyers commonly include in purchase offers. The licensee explains that certain contingencies protect the buyer and may allow them to exit the contract without penalty. Which of the following is NOT a situation in which a buyer may terminate a Connecticut purchase contract and recover the earnest money deposit without being in default?
Correct Answer
C) The buyer changes their mind about purchasing the property after all contingencies have been waived and the contract is fully binding
Once all contingencies have been waived or satisfied and the purchase contract is fully binding with no remaining contingencies, a buyer who simply changes their mind about the purchase is in breach of contract. The buyer cannot terminate without penalty — the seller may retain the earnest money deposit and potentially pursue additional remedies such as specific performance. Buyer's remorse is not a contingency and does not protect the buyer from default consequences under Connecticut contract law.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Earnest money is a deposit made by the buyer at the time of the offer or shortly after to demonstrate good faith and serious intent to purchase the property. It is also called a good faith deposit.
Equitable title is the buyer's interest in a property after a purchase contract is signed but before closing, giving the buyer the right to acquire legal title in the future. The seller retains legal title until the deed is delivered at closing.
A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.
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