In Delaware, a buyer acquires equitable title to a property when:
Correct Answer
B) A valid purchase agreement is executed by all parties
Equitable title passes to the buyer upon execution of a valid purchase agreement, giving the buyer an enforceable interest in the property before closing. Legal title does not transfer until the deed is delivered and accepted at closing. This distinction means the buyer has a protected interest in the property from the moment the contract is signed, even though the seller retains legal title until the deed is conveyed.
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Related Topics & Key Terms
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Related Concepts
A counteroffer is a response to an original offer that changes one or more terms of the offer, effectively rejecting the original offer and creating a new offer. The party who makes the counteroffer becomes the new offeror.
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.
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- → A Rhode Island licensee encounters a listing contract is drafted. What should the licensee remember?
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- → Which Rhode Island rule applies when a listing agreement lists property with a multiple listing service?
- → A Rhode Island licensee encounters a listing agreement lets the principal broker retain a portion of deposit money upon buyer default. What should the licensee remember?
- → A Hawaii licensee is reviewing the commission asks to inspect escrow and trust records. What is the best answer?
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