Question

Alice signs a contract with bob to buy bob's house for $150,000, with the clause, "if i am able to obtain a mortgage loan for $125,000, at no more than 7% interest, payable over 15 years." assume that alice tries but is unable to obtain the described loan, and therefore refuses to proceed with the purchase. alice is in breach of the contract.

Answer 1

False

Step-by-step explanation:

In the given scenario, Alice would not be in breach of the contract. The clause in the contract states that the purchase is contingent upon Alice's ability to obtain a specific mortgage loan meeting certain conditions, such as the loan amount, interest rate, and repayment terms.

If Alice makes a genuine effort to obtain the described loan but is unable to do so, she is not obligated to proceed with the purchase. The clause acts as a condition precedent, meaning that the obligation to purchase the house only arises if the specified condition (obtaining the mortgage loan) is fulfilled.

Answer 2

yes, in short yeah she is.