A buyer and seller agree in the contract that failure to close by the stated date is a material breach. On the closing date, the buyer requests a 10-day extension. The seller refuses and declares the buyer in breach. Which clause supported the seller's position?
Correct Answer
B) Time is of the essence clause
A time-is-of-the-essence clause makes deadlines material, meaning failure to close by the stated date can constitute a breach.
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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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