Karen's contract to purchase a house in Westchester includes both an inspection contingency and an appraisal contingency. The inspection reveals $8,000 in needed repairs, and the appraisal comes in $12,000 below the purchase price. Karen wants to proceed with the purchase. What is her best strategy under New York law?
Correct Answer
B) Negotiate a $20,000 price reduction to cover both the repairs and appraisal shortfall
Negotiating a single price reduction that addresses both issues ($8,000 for repairs plus $12,000 for appraisal shortfall) is the most efficient approach. This allows Karen to proceed while being compensated for both the repair costs and the appraisal gap, effectively satisfying both contingencies through price adjustment.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
Offer and acceptance is the process by which one party proposes specific terms for a contract and the other party agrees to those exact terms, creating mutual assent. This mutual agreement, also called a meeting of the minds, is an essential element of every valid contract.
An option contract gives one party the exclusive right, but not the obligation, to purchase or lease a property at a specified price within a specified time period. The buyer pays option consideration to keep the option open.
More Contracts Ny Real Property Law Questions
A buyer in New York breaches a contract to purchase a $600,000 home and forfeits a $30,000 earnest money deposit. The seller incurs $8,000 in additional carrying costs and $4,000 in remarketing expenses before selling to another buyer for $585,000. What is the seller's total recoverable damages?
A New York buyer exercises their right to cancel a purchase contract within the attorney review period. The seller demands to keep the earnest money as compensation for taking the property off the market. What is the legal outcome?
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Tom is buying a condominium in Syracuse and reviewing the purchase contract. What type of title insurance should Tom expect to receive?
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