A buyer includes a condition in an Agreement of Purchase and Sale that states the offer is conditional upon them obtaining satisfactory financing by a specific date. If the buyer is unable to secure financing and does not waive the condition by the specified date, what is the most likely outcome?

Question: A buyer includes a condition in an Agreement of Purchase and Sale that states the offer is conditional upon them obtaining satisfactory financing by a specific date. If the buyer is unable to secure financing and does not waive the condition by the specified date, what is the most likely outcome?

Answer options: ✅ The agreement becomes null and void.

• The seller can sue the buyer for specific performance.
• The buyer is entitled to an extension of the financing period.
• The buyer loses their deposit to the seller as liquidated damages.

Correct answer: The agreement becomes null and void.

Explanation: If a condition in an Agreement of Purchase and Sale is not fulfilled or waived by the specified date, and it was for the benefit of the party who did not fulfill it, the agreement typically becomes null and void, and the deposit is returned to the buyer.