72 Hour Clause Law and Legal Definition
A 72 hour clause is a clause in a written contract for real estate purchase. This clause allows a seller to accept a buyer's contingent offer to purchase his/her property, while allowing the seller to continue to market the property. For example, if a person has a house for sale, s/he will accept a buyer’s offer reserving the right to accept a better offer. Subsequently if the seller receives a better offer for the house, he/she can accept this offer, as a back-up offer. The seller can then activate the escape clause by notifying the original buyer about the back-up offer. In short, the seller gives the first buyer 72 hours to purchase or allows the second offer to prevail.
The term 72-hour clause can be misleading, because the notice period within which the buyer must fulfill the buyer contingencies can be negotiated. This clause is also known as is also known as an escape clause, release clause, kick out clause, or hedge clause or right of first refusal clause.
