12 - Real Estate Contracts Flashcards
an agreement between two or more parties to do something or to refrain from doing something.
contract
A contract created by behavior.
ex: ordering food at a restaurant
implied contract
A valid oral agreement through negotiation of an agreed price and terms between parties.
ex: someone knocks on your door and offers to move your lawn for $30.
express contract
A contract of sale between a buyer and seller or landlord where both parties must perform.
bilateral contract
A contract that lacks mutuality. Only one party must perform.
unilateral contract
residential contract forms established by TREC that, with a few exceptions, are mandatory for license holders.
promulgated - to make known by open declaration; publish.
promulgated forms
A contract that meets all of the requirements of law.
valid contract
a contract that is invalid from the beginning and does not affect on the parties.
void contract
A contract that cannot be enforced against one of more of the parties.
most contracts entered into with minors are voidable at the option of a miner.
voidable contract
A contract that cannot be enforced due to some flaw in the contract, passage of time, or other issues that make enforcement impossible.
unenforceable contract
when both parties to a contract agree to its cancellation.
mutual rescission
Under this law, Contract for the conveyance of ownership and real estate must be in writing to be enforceable.
An exception to this law would be lease agreements that are for less than a year.
Statute of Fruads
A contract that is binding on the parties, with one or more of the parties having contractual duties that have not been performed. The effective date is the date that acceptance was communicated to the offering party.
executory contract
When a party to a contract fails to perform under the contract, they are in _____.
default
A ______ of a contract transfers all of the rights related to the contract to another party known as the assignee.
assignment
Occurs when a new contract is substituted for an existing one. The new agreement may include new parties.
novation
A “deposit” paid upfront by the buyer to show that he or she is serious in intent. It must be delivered within 3 days after the effective date.
earnest money
the process of dividing ongoing expenses between the buyer and the seller at closing.
Generally calculated through the day of closing for taxes, maintenance fees, and rents if any, that the seller pays for on closing day.
proration
the process of dispute resolution as an alternative to settling the dispute in court.
includes both parties meeting with a mediator to discuss their respective side of the issue at hand.
mediation
Gives the buyer the unrestricted right to terminate the contract within the option period. The termination may be for any reason or no reason at all.
option
