Which statement best describes an inspection contingency in a Hawaii real estate purchase contract?
Correct Answer
B) The inspection contingency allows the buyer to conduct professional inspections — including termite, mold, and radon — and to negotiate repairs or terminate the contract based on findings.
Hawaii's inspection contingency allows buyers to conduct a range of professional inspections. Hawaii's tropical climate makes termite (wood-destroying organism) and mold inspections especially important in addition to standard home inspections. If issues are found, the buyer may negotiate repairs, request a price reduction, or terminate the contract and recover their earnest money.
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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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