Question 19

Buyer can terminate the contract without penalty.

When a purchaser does not receive the Property Owners' Association resale certificate prior to closing, the buyer has the right to terminate the contract without incurring any penalties. This provision is designed to protect buyers from proceeding with a purchase without essential information regarding the property.

A) Purchase contract is automatically null and void.

This option is incorrect because the absence of a resale certificate does not automatically nullify the purchase contract. Instead, it grants the buyer the right to terminate the contract if they choose to do so.

B) Buyer can terminate the contract without penalty.

This option is correct as it reflects the buyer's rights in situations where they have not received the Property Owners' Association resale certificate. The law provides this protection to ensure that buyers are not obligated to proceed with a transaction under potentially unfavorable conditions.

C) Buyer's agent may be held responsible for failure to perform his duties.

While a buyer's agent has a duty to obtain necessary documents, this option does not directly address the consequences of not receiving the resale certificate. It does not reflect the specific outcome related to the buyer's rights in this situation.

D) Buyer is required to close the transaction under the terms of the contract.

This option is incorrect since the buyer is not obligated to close if they have not received the resale certificate. The buyer's right to terminate the contract without penalty clearly indicates that they are not required to proceed with the transaction.

Conclusion

The correct answer is that the buyer can terminate the contract without penalty, ensuring their protection in real estate transactions. Other options fail to accurately reflect the rights and protections afforded to the buyer when the resale certificate is not provided, highlighting the importance of obtaining all necessary documentation before closing.