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?
Correct Answer
A) The buyer is entitled to full return of the earnest money
Under New York law, when a buyer properly exercises their right to cancel during the attorney review period, this is not a breach of contract but rather the exercise of a contractual right. The buyer is entitled to full return of the earnest money without any deductions or penalties.
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