Tender of performance: If both parties fail to perform, what happens to the closing date?

• A. The closing date is extended until one party performs
• B. The contract is automatically terminated
• C. The seller must perform immediately
• D. The value of the property must be appraised

Answer: (A)

Tender of performance means offering to fulfill your contractual duties at the time of closing. If neither side performs on the closing date and there’s no clause making time of the essence, the deal doesn’t automatically end. The contract stays alive and the closing date is effectively pushed forward until one party tenders performance. This preserves the agreement rather than terminating it prematurely.

Automatic termination would usually require that time be of the essence or that the contract specifically allows termination for non-performance. Appraising the property’s value isn’t the remedy here, and the seller isn’t compelled to perform immediately just because the date arrives.