When a seller makes a counteroffer, it legally:
Correct Answer
B) Rejects the original offer and creates a new offer
A counteroffer simultaneously rejects the original offer and creates a new offer with different terms. The original offer is extinguished and cannot be accepted after a counteroffer is made. The original offeror then becomes the offeree and may accept, reject, or counter the new offer.
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Related Topics & Key Terms
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Key Terms:
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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