Bona Fide

Bona Fide is a term that states that someone's actions or negotiations are in good faith. For example, when a buyer purchases a home from a seller, the seller is expected to negotiate the price of the home in a bona fide fashion. That means that any damage to the property or anything else that could lower or depreciate the value of the home must be made known to the buyer before the purchase is complete. If the buyer later finds out that the seller did not negotiate in a bona fide fashion and finds evidence that the seller committed fraud or used concealed information to protect the sale price of the property, the buyer has a legal right to pursue action against the seller. If it is later discovered that a legal contract was entered into in bad faith, a party can attempt to escape the contract.