A purchase agreement for an Iowa City residential property is signed by both parties. The agreement does not include a seller disclosure contingency, but the seller has not yet delivered the required Residential Property Seller Disclosure Statement under Iowa Code Chapter 558A. The buyer receives the disclosure three days after signing the purchase agreement. What right does the buyer have under Iowa law?
Correct Answer
B) The buyer may rescind the purchase agreement within a reasonable time after receiving the late disclosure
Under Iowa Code Chapter 558A, the seller must deliver the Residential Property Seller Disclosure Statement before or at the time the purchase agreement is signed. When disclosure is delivered late (after signing), Iowa law grants the buyer the right to rescind the purchase agreement within a defined period after receiving the disclosure. This rescission right protects buyers who signed without having the required information.
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Related Topics & Key Terms
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Related Concepts
A time is of the essence clause in a contract means that all deadlines and dates specified in the agreement are strictly enforceable, and failure to meet them constitutes a material breach.
An appraisal contingency allows the buyer to cancel or renegotiate the contract if the property's appraised value comes in lower than the agreed-upon purchase price. This contingency protects buyers from overpaying.
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.
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