A New Jersey real estate contract becomes binding when:
Question & Answer
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The offer is made
After the attorney review period expires without disapproval
When earnest money is deposited
Earnest money deposit is evidence of good faith but doesn't create contractual obligations in New Jersey. The payment occurs during the attorney review period, before the contract is binding.
At closing
Closing is the final step of the transaction where title transfers, but contractual obligations were established earlier when the attorney review period expired.
Why is this correct?
In New Jersey, the attorney review period is a statutory provision that allows attorneys for both parties to review and potentially disapprove the contract. The contract only becomes binding when this period expires without either attorney exercising their right to disapprove.
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