An investor has 20 days to study zoning, leases, environmental reports, and operating records before deciding whether to proceed. What contingency best describes this period?
Correct Answer
D) Due-diligence contingency
Due-diligence contingency is correct because the facts match a provision giving a buyer time to investigate matters such as zoning, title, condition, and feasibility before becoming fully obligated. That is the best description of the relationship, right, or legal concept tested here.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Contract termination occurs when a contract is ended or discharged, releasing both parties from their obligations. A contract can be terminated through performance, mutual agreement, operation of law, or breach.
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.
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- → A Rhode Island licensee encounters a listing contract is drafted. What should the licensee remember?
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- → A Hawaii licensee is reviewing the commission asks to inspect escrow and trust records. What is the best answer?
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