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Real Estate > B-4; Listing/Purchase Agreements > Flashcards

B-4; Listing/Purchase Agreements Flashcards

1
Q

Three Other Names for listing agreement

A

Employment Agreement;Authorization to Sell;Contract for Professional Service

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2
Q

Does an Executive Right to sell/rent have an expiration date?

A

Yes

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3
Q

Is the broker paid if the property is exchanged?

A

Yes

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4
Q

Is a commission paid if property is leased? If so, how is it calculated? If the lease is renewed?

A

Yes, in this case, commission is 10% of lease value. Renewal commission is 1/2 the rental commission.

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5
Q

Is a commission due if seller breaches the contract?

A

Yes; 1/2 earnest money, or all commission, whichever is less.

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6
Q

If buyer forfeits earnest money, is the broker due a commission?

A

Yes

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7
Q

Does a seller have to agree to internet marketing or 3rd party comments?

A

No

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8
Q

Must a broker present oral offers to the seller?

A

Yes, broker must submit ALL offers.

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9
Q

If the property is community property and only the wife signs the listing and the broker performs, is a commission due?

A

Yes, takes 1 signature to list, two signatures to sell.

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10
Q

What is “square feet livable”

A

Exterior measurements of all heated and cooled areas. (heating,cooling, ventilation)

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11
Q

What is “square feet under roof”

A

external dimensions including non HVAC areas such as patio and garage.

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12
Q

Are listings property of the salesperson or broker?

A

Listings are broker property.

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13
Q

Three other names for a Purchase Contract

A

Agreement to sell; Contract to sell; Deposit Receipt

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14
Q

Must a real estate contract have a legal description?

A

Yes, legal description can be valuable or good.

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15
Q

If the buyer is unable to obtain the required loan, what is the status of the earnest money?

A

Earnest money is refunded if diligent and good faith effort to qualify has been made.

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16
Q

How long does a buyer have to complete the loan status update?

A

5 days after contract acceptance

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17
Q

If property doesn’t appraise for the sales price, what are the options for the buyer?

A

Buyer has 5 days to cancel with earnest money refunded, or buyer moves forward with the purchase and comes up with difference of funds.

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18
Q

Do separate escrow instructions need to be prepared to have a binding contract?

A

No.

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19
Q

How many days does the buyer have to review the title report?

A

5 days after receipt of the title commitment

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20
Q

Who notifies homeowner association regarding the pending sale?

A

Escrow company

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21
Q

Who usually pays the escrow fee?

A

Buyer and seller typically split escrow fee

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22
Q

What is the purpose of the SPDS report?

A

Let buyer know the condition of the property KNOWN by the seller. It is NOT a state or federal law. it is CONTRACTUAL.

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23
Q

What is required of the seller regarding the insurance claim history?

A

5 year claims history within 5 days of contract acceptance.

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24
Q

What does C.L.U.E stand for?

A

Comprehensive liability underwriting exchange; this is the claims history report.

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25
Q

When is a lead-based paint disclosure required?

A

If a RESIDENTIAL building was constructed prior to 1978.

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26
Q

Will any seller warranties survive close of escrow?

A

Yes, that seller has disclosed ALL material latent defects.

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27
Q

How many days does the buyer have to inspect the property?

A

10 days; unless another time frame is agreed upon by both parties.

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28
Q

Who pays for the termite inspection?

A

Buyer pays for termite inspection.

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29
Q

Is a termite inspection required by law?

A

No, but sometimes required by lender or other contract.

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30
Q

If the property contains a swimming pool what disclosures are required?

A

AZ department approved private pool safety notice is required. Especially if the client has children.

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31
Q

Is a real estate agent required to conduct property inspections for the buyer?

A

No.

32
Q

If the buyer has a list of repairs that were discovered during the inspection period, what is the status of the contract?

A

Contract can then be cancelled with earnest money returned, OR give seller opportunity to resolve issue.

33
Q

How long does a seller have to make necessary repairs found during inspection period?

A

3 days prior to close of escrow.

34
Q

If the buyer fails to conduct the necessary inspections, what is the status of the contract?

A

Contract will move forward.

35
Q

Is a home warranty plan required in all resale purchase contracts?

A

No.

36
Q

What are the seller’s responsibilities regarding the walk through?

A

Seller must make premises available, with utilities turned on.

37
Q

When would a cure period be used and for what purpose?

A

If either party breaches or defaults on contract, a cure period (time to resolve issues) of 3 days is given.

38
Q

If there is a dispute between the buyer and seller after the contract is signed, what is the procedure?

A

ADR (alternative dispute resolution) or mediation occurs.

39
Q

What is meant by “liquidated damages”

A

Pre-agreed amount determined by buyer and seller as compensation for breach of contract. (usually earnest money)

40
Q

What are compensatory damages?

A

Damages awarded by court to cover actual damages.

41
Q

What is meant by “specific performance”?

A

Court process forcing defaulting party to preform.

42
Q

In the event of legal action, who pays legal fees?

A

loser in court pays fees.

43
Q

Who is liable if the property is destroyed before the close of escrow?

A

Risk of loss is on seller, as long as cost doesn’t exceed 10%.

44
Q

Can the buyer cancel the contract if property is damaged before close of escrow?

A

Yes, they can cancel if the cost of repairs is above 10%

45
Q

What gives the broker the right to commission?

A

Services rendered as agreed in listing contract.

46
Q

If an offer is accepted may the seller accept back-up offers?

A

If stated in the contract, seller may accept backup offers contingent upon cancellation of current offer.

47
Q

Once earnest money is received, how long does the broker have to deposit the funds?

A

Broker has until next business day to deposit funds.

48
Q

If seller accepts the buyer’s offer but the buyer is not informed of acceptance, does a valid contract still exist?

A

Yes; it becomes biding when broker receives the contract.

49
Q

What is meant by Agency confirmation?

A

Information explaining who the agent is representing, whether it be the buyer,seller, or both (duel agent).

50
Q

What is required if seller rejects the offer given?

A

Line 416 is filled out, rejected box is checked, dated and signed.

51
Q

Under what conditions would the buyer be most likely refunded the earnest money?
A. Breach of contract
B. Failure to meet close of escrow date
C. Failure to conduct property inspections
D. Failure to qualify for financing

A

D. Failure to qualify for financing

52
Q 
The listing agreement provided in class B-4 indicated that the broker has which type of listing?
A. Non-exclusive
B.Exclusive right to sell
C.MLS listing
D.Exclusive agency
A

B.Exclusive right to sell

53
Q

In this listing contract, the real estate broker must:
A.Not advertise without approval of owner
B.Exercise diligence in finding a purchaser
C.Find a purchaser within the period stated in the contract
D.Advertise if the seller pays an advanced fee

A

B.Exercise diligence in finding a purchaser

54
Q 
According to the contract provided in class B-4, what party of parties would suffer the risk of loss in case of damage of the property by fire, vandalism, or an act of God prior to close of escrow?
A.Title insurance company
B.Broker
C.Seller
D.Buyer
A

C. Seller

55
Q

The purchase agreement states:
A.The broker has the right to present subsequent offers even after one offer is accepted
B.The broker may accept or reject offers
C.The broker need not present any subsequent offers after one is accepted
D.Broker may sing a counteroffer for the seller

A

A.The broker has the right to present subsequent offers even after one offer is accepted

56
Q 
In Arizona, a broker must be able to prove employment by a seller in order to be assured of collecting a commission. Proof of employment is:
A. A deposit receipt
B.An escrow agreement
C. A listing contract
D. A purchase contract
A

C. A listing contract

57
Q 
When listing a property for sale, what is required by the rules and regulations to appear on the face of the listing agreement?
A. Amount of annual taxes
B. Expiration date
C.Street address
D.Mortgage balance
A

B. Expiration date

58
Q 
A listing agreement is a mutual agreement between a broker and a principal and is considered:
A. A contract of sale
B. An agreement of sale
C. A purchase contract
D. An authorization to sell
A

D. An authorization to sell

59
Q 
If a disagreement occurs between buyer and seller at the time of escrow closing, where do the parties turn to settle their disagreement?
A. Broker
B. Escrow agent
C.Escrow agreement
D. Purchase contract
A

D. Purchase contract

60
Q

The price of a listed property should NOT be advertised or offered unless it conforms to:
A. The appraised valuation
B.An amount previously agreed to by the owner
C.What the broker thinks is a good fair market value
D.Any price that the broker feels the owner will accept

A

B.An amount previously agreed to by the owner

61
Q

In order to be enforceable, an exclusive listing:
A. Shall contain the words “exclusive right to sell”
B.Need only be in writing
C.Must be signed by the owner and broker
D.Must be signed and accepted by the purchaser

A

C.Must be signed by the owner and broker

62
Q 
If the seller retains the buyers earnest money due to a contract breach, this would be called:
A.actual damages
B.Liquidated damages
C.Punitive damages
D.Equitable damages
A

B.Liquidated damages

63
Q 
Assume that the buyer defaulted in performance on the contract provided in class B-4, and the earnest money was forfeited. How much commission would the broker receive?
A. 3,000
B.8,000
C. 1/4 of the earnest money
D. The amount specified in the listing
A

D. The amount specified in the listing

64
Q 
According the listing provided in class B-4, how much commission will the broker receive if the present lease is renewed at a monthly rent of $2200.?
A. $660
B. $1320
C. $1848
D. $2640
A 
B. $1320
10% of 2200=220x12months 
=2640.
Renewal commission is 1/2.
=1320.
65
Q

The day after the brokers listing expires, seller sold property to a buyer that was shown the property by the listing broker, which of the following is true?
A. Seller wouldn’t owe a commission
B.Seller would owe 1/2 commission
C. Seller owes full commission
D. Seller only owes full commission if buyer paid full price

A

C. Seller owes full commission

66
Q 
According to B-4 contract, when is the escrow considered closed?
A.When all documents are signed
B.When the loan is funded
C. When all documents are recorded
D. When deed is delivered
A

C. When all documents are recorded

67
Q

Square feet livable is defined as the:
A. Interior measurement of all areas heated and cooled
B.Exterior measurement of all areas heated and cooled
C. Exterior measurements under rood
D. Interior measurements of all areas under roof

A

B.Exterior measurement of all areas heated and cooled

68
Q

According to B-4 purchase contract, if the close of escrow is not met, which of the following is true?
A. Contract is terminated
B.Seller must give the buyer a 3 day cure period
C. A new close of escrow date is set
D. Brokers will extend the escrow period until the parties perform

A

B.Seller must give the buyer a 3 day cure period

69
Q

The lead-based paint disclosure is required in which of the following cases:
A. All residential properties
B. All residential properties where children will reside
C. All residential properties built before 1978
D. All properties built before 1978

A

C. All residential properties built before 1978

70
Q

The seller accepts the buyer’s offer but the buyer was not informed of the acceptance. Using contract provided in B-4, what is the status of the contract?
A. Contract is void
B. Buyer is bound once the buyers broker receives a signed acceptance
C. The buyer is bound once the seller accepts the offer
D. Once the seller accepts the offer the buyer may still counter the offer

A

B. Buyer is bound once the buyers broker receives a signed acceptance

71
Q

The seller warranties in the purchase contract would include all of the following EXCEPT:
A. All heating, cooling and electrical will be in working order
B.All agreed-upon repairs have been made
C. All personal property will be in the same working order as of contract date
D. All mechanical equipment will work for 30 days after close of escrow

A

D. All mechanical equipment will work for 30 days after close of escrow

72
Q 
A listing agreement would contain all of the following information EXCEPT:
A. Property description
B. Ending date
C. Types of churches in the area
D. Zoning type
A

C. Types of churches in the area

73
Q

If the seller breaches the purchase contract provided in B-4, what is the status of the brokers commission?
A. The seller is not obligated to pay a commission
B.The broker would receive the earnest money as a commission
C. The seller would be obligated to pay the entire commission
D. The broker would only receive one half the commission

A

C. The seller would be obligated to pay the entire commission

74
Q

A salesperson works for broker A, and has contracts in escrow. The salesperson decides to leave broker A and work for broker B. Which of the following is true regarding the salespersons commission?
A. Broker A would pay the salesperson directly
B. Broker A would pay commission to broker B
C. Broker B must approve commission from broker a

D. Broker A would need real estate department permission to pay the salesperson

A

A. Broker A would pay the salesperson directly

75
Q 
The language in the listing agreement obtains preliminary permission for the broker to represent which of the following parties in a transaction:
A. seller only
B. buyer only
C. buyer and seller
D. sell as an attorney-in-fact
A

C. buyer and seller

76
Q 
Compensatory damages would be the closest to:
A. Actual damages
B.Punitive damages
C. Specific performance
D. Earnest money
A

A. Actual damages

77
Q

The seller tells the broker they would like to sell their property furnished. The agent should do all of the following EXCEPT:
A. Add the personal property to the deed
B. Prepare a complete inventory of all items
C. Ask the seller to provide a bill of sale for the items
D. Attach a complete list of all items to the purchase contract

A

C. Ask the seller to provide a bill of sale for the items

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