What happens to the interest in real property if a buyer dies after the contract is made but before closing?

When a buyer dies after entering into a contract for the sale of real property but before the closing takes place, the interest in the real property generally passes to the buyer's estate. This situation is governed by the principle that rights and obligations under a contract can be inherited. Specifically, upon the buyer's death, their rights under the contract do not simply disappear or revert to the seller; instead, they become part of the buyer's estate.

The estate will manage these rights, which may include the completion of the transaction, depending on the specific terms of the contract and local laws regarding real property transactions. The estate may decide to proceed with the closing if it is in the best interest of the beneficiaries or heirs.

This principle acknowledges the continuity of property rights through inheritance, ensuring that the buyer's estate retains the contractual interest that can then be passed on to heirs or resolved as part of the estate's administration. The other options relate to different scenarios that do not accurately reflect the legal handling of a buyer's interest in real property upon their death.