Under the TREC contract, the Addendum for Back-Up Contract is attached at the time the contract is executed. If the first contract terminates and the back-up contract becomes primary, what notice is required?
Correct Answer
C) The seller or seller's agent must notify the back-up buyer that the first contract has terminated and the back-up contract is now effective
When the first contract terminates, the seller or seller's agent must notify the back-up buyer. This notice establishes the effective date of the back-up contract and triggers all time-sensitive deadlines.
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Related Topics & Key Terms
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Related Concepts
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.
A bilateral contract is an agreement in which both parties exchange promises and are both obligated to perform, while a unilateral contract is one in which only one party makes a promise and the other party is not obligated to act.
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