Question

In: Economics

The following is a list of contract provisions. With each provision, indicate whether it favors the seller or the purchaser and briefly state why.

The following is a list of contract provisions. With each provision, indicate whether it favors the seller or the purchaser and briefly state why.

a. Seller is to convey marketable title to the real property at closing.

b. "Time is of the essence."

c. Seller shall not alter or encumber the title to the property after the date of the contract without the prior written consent of purchaser.

d. The taxes and insurance shall be prorated.

e. The contract is silent as to the risk of loss between date of contract and date of closing.


Solutions

Expert Solution

1) This favors the buyer, Every property must have a marketable title, Without title the buyer will be in trouble

2) Time of essence usually favor the seller, Because once the time of the contract is over, the seller can choose not to sell the property at that particular agreed price

3) Favors buyer, Any clause that limits the rights of seller automatically favors buyer. Seller will loose right to restrict the title change after the purchase of property without approval of the buyer. This favors buyer

4) Favors seller, As taxes are distributed between buyer and seller.

5) Neutral,

Rahul Sunny answered 2 years ago
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