Texas Real Estate Sales Agent ExamTexas Real Estate LawMedium
A buyer submits an offer on a property. The seller makes a counteroffer, changing the closing date and adding a contingency for the sale of their current home. What is the legal status of the buyer's original offer?
- AIt is automatically terminated by the seller's counteroffer.
- BIt is temporarily suspended until the buyer responds to the counteroffer.
- CIt remains valid and can be accepted by the seller if the counteroffer is rejected.
- DIt can be reinstated if the buyer agrees to the original terms after rejecting the counteroffer.
Show answer & explanationAnswer & explanation
Correct answer: A. It is automatically terminated by the seller's counteroffer.
A counteroffer acts as a rejection of the original offer and creates a new offer. Therefore, the buyer's original offer is terminated and can no longer be accepted by the seller.
Why the other options are wrong
- B. Suspension is not the correct legal status; it is terminated.
- C. Once a counteroffer is made, the original offer is no longer valid.
- D. The original offer is terminated; a new offer would need to be made if the buyer wanted to revert to those terms.
Counteroffer
A response to an offer that changes one or more of the original terms, thereby rejecting the original offer and creating a new offer.
- Rejects original offer
- Creates a new offer
- Can be accepted, rejected, or countered again
Memory trick: An offer's journey: present, modify, or let it fade.