A buyer in Pennsylvania purchases a property contingent on obtaining FHA financing. The FHA appraisal identifies health and safety issues that must be corrected before the loan can close. The seller refuses to make the required repairs. What is the buyer's best course of action?
Correct Answer
C) Exercise the mortgage contingency to terminate the agreement since FHA financing cannot be obtained without the repairs
If FHA financing cannot be obtained because the seller refuses to make required repairs identified in the FHA appraisal, the mortgage contingency is not satisfied. The buyer may exercise the contingency to terminate the agreement and receive a refund of hand money, since the specified FHA financing cannot be obtained.
Why This Is the Correct Answer
Why the Other Options Are Wrong
Deep Analysis of This Pa Specific Contract Provisions Question
Background Knowledge for Pa Specific Contract Provisions
Real World Application in Pa Specific Contract Provisions
Common Mistakes to Avoid on Pa Specific Contract Provisions Questions
Related Topics & Key Terms
Key Terms:
Related Concepts
A time is of the essence clause in a contract means that all deadlines and dates specified in the agreement are strictly enforceable, and failure to meet them constitutes a material breach.
An appraisal contingency allows the buyer to cancel or renegotiate the contract if the property's appraised value comes in lower than the agreed-upon purchase price. This contingency protects buyers from overpaying.
An assignment of contract transfers one party's rights and obligations under a contract to a third party called the assignee. The original party, known as the assignor, transfers their contractual position to someone who was not originally part of the agreement.
More Pa Specific Contract Provisions Questions
Under the PAR Agreement of Sale, all of the following are obligations of the buyer under the mortgage contingency EXCEPT:
A licensee in Pennsylvania is preparing a PA Agreement of Sale that includes an option for the buyer to purchase the property within 90 days. What makes an option contract valid in Pennsylvania?
A seller in Lehigh County discovers that the buyer has been secretly negotiating to purchase a different property while under contract. The buyer has not yet breached any deadlines. Can the seller declare the buyer in default?
A licensed salesperson in Pennsylvania mishandles the hand money deposit by depositing it into their personal account instead of the broker's escrow account. The buyer later defaults, and the deposit is not fully available. What are the consequences for the salesperson?
A buyer in Schuylkill County enters into a PA Agreement of Sale for a property that was listed as having 3 acres. After closing, the buyer discovers the property is only 2.5 acres based on a new survey. The Agreement of Sale did not include a survey contingency. What remedy may the buyer pursue?
- → A buyer in Westmoreland County has an inspection contingency that expires in 5 days. The buyer has not yet scheduled an inspection. On day 4, the buyer asks the seller for a 10-day extension. The seller refuses. What happens?
- → A buyer in Lycoming County has an inspection contingency in the PA Agreement of Sale. The buyer's inspector recommends that a licensed electrician evaluate the electrical panel. The buyer schedules an electrician, but the seller refuses access for the follow-up inspection within the contingency period. What is the buyer's best course of action?
- → A buyer in Blair County closes on a property and later discovers the seller's real estate agent knew about a major plumbing defect but did not disclose it. The buyer sues both the seller and the agent. If the buyer obtains a judgment against the agent but the agent cannot pay, what is the maximum the buyer can recover from the PA Real Estate Recovery Fund per transaction?
- → Under the PAR Agreement of Sale, the buyer has an inspection contingency with a 10-day inspection period. On day 8, the buyer submits a repair request. The seller does not respond by the end of day 10. What happens under the standard PAR provisions?
- → A buyer in Dauphin County wants to know what happens to the hand money if both the buyer and seller agree to cancel the PA Agreement of Sale by mutual consent. What is the typical outcome?
- → A buyer in Erie County wants to know who decides if a breach of the Agreement of Sale has occurred. Under PA law, who makes this determination?
- → A buyer in Cambria County wants to sue a seller for breach of the PA Agreement of Sale. The buyer's attorney recommends filing in the Court of Common Pleas. What type of court is the Court of Common Pleas in Pennsylvania?
- → A buyer defaults on a PA Agreement of Sale with a purchase price of $380,000. The hand money deposit is $12,000 (retained by the seller as liquidated damages). The seller relists and sells the property 4 months later for $365,000, incurring $6,000 in additional carrying costs and $4,500 in remarketing expenses. If the seller had pursued actual damages instead of liquidated damages, what is the total potential actual damage claim?
- → Under the PAR Agreement of Sale, which of the following is NOT a standard remedy available to the seller when a buyer defaults on the contract?
- → A buyer in Lebanon County enters into a PA Agreement of Sale. The seller makes verbal promises during the showing about installing new appliances before closing. At closing, the appliances are not installed. The written agreement does not mention new appliances. Can the buyer enforce the verbal promise?
People Also Study
Buyer Representation Agreement
8% of exam
Property Ownership
10% of exam
Land Use Controls and Regulations
8% of exam
Valuation and Market Analysis
10% of exam
Related Articles
Real Estate Exam Pass Rates by State: 2026 Data Report
Last updated: March 2026 | Sources: State licensing boards, ARELLO, Bureau of Labor Statistics
What to Do When Your Real Estate Exam Study Plan Looks Good on Paper but Keeps Slipping
If you are searching for real estate exam study plan keeps slipping , the practical answer is usually more useful than a motivational one. The biggest...
How to Prepare for the Real Estate Exam If You Learn Better by Writing Things Out
If you are searching for how to prepare for real estate exam by writing notes , the practical answer is usually more useful than a motivational one. The...
Previous Question
Under the PAR Agreement of Sale, the buyer has an inspection contingency with a 10-day inspection period. On day 8, the buyer submits a repair request. The seller does not respond by the end of day 10. What happens under the standard PAR provisions?
Next Question
A buyer in Chester County includes a radon contingency in the PA Agreement of Sale. The radon test results come back at 3.5 pCi/L. Under EPA guidelines and the radon contingency, what is the buyer's position?