When a seller responds to a buyer's offer by changing one or more terms, this counteroffer 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. The original offer is extinguished and cannot be accepted; the original offeror (buyer) is now free to accept, reject, or counter the new terms.
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Related Topics & Key Terms
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Key Terms:
Related Concepts
Equitable title is the buyer's interest in a property after a purchase contract is signed but before closing, giving the buyer the right to acquire legal title in the future. The seller retains legal title until the deed is delivered at closing.
A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
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