Ch 8 - Contracts Flashcards
An agreement formed by the receipt of an earnest money deposit as evidence of the buyers good faith and intent
Binder or deposit receipt
An interest in the property acquired once the parties have signed the purchase agreement
Equitable title
an act or the promise thereof, which is offered by one party to induce another to enter into a contract
Consideration
Rights, privileges, and improvements that are transferred with the property, but are not part of the actual property
Appurtenances
An item that was once personal property, but has been affixed to a property, becoming real property
Fixture
A provision that prevents the contract, or any specific covenant in the contract, from merging with the deed
Survival clause
An agreement used primarily for financing commercial properties
Sale-leaseback agreement
The buyers initial deposit and serves as evidence of intent to fulfill his obligations under the contract
Earnest money
What type of contract is a lease?
Bilateral
What type of lease is an option?
Unilateral
True or False:
Option money purchases “time” and does not provide the optionee with an interest in the property
True
True or false:
In a purchase agreement, the parties must fully perform their obligations at the time the agreement is signed
False - The parties do not fully perform their obligations at the time the agreement is signed
True or false:
A contract is still valid if no closing date is specified
True
True or False:
The brokers responsibilities are not ended when the agreement is signed
True
True or False:
The type of deed the seller agrees to deliver at closing should be specified in the contract
True
A _________ is a bilateral contract involving two parties: the _______ and the ________
Lease
Lessor (usually the landlord)
Lessee (usually the tenant)
What type of contract is usually used when sufficient financing is not available to the buyer from a lending institution?
A land contract, also known as an installment contract, conditional sales contract or contract for deed
What document typically has these provisions: date, parties, mutual agreement, legal description, price and terms, earnest money, type of deed, marketable title, distraction to the premises, possession, closing date, brokers commission, signatures?
Form contract
What are the two most commonly found contingencies in sales contracts?
- Contingent upon the sale of the purchasers present home
2. Contingent upon satisfactory home inspection
At closing, the ______ Merges with the deed as title passes to the buyer
Sales contract
In the event of destruction or substantial damage, other states have enacted the _______ Which places the risk of loss on the seller (vendor) until the buyer is given possession of the property
Uniform vendor and purchaser risk act
In order to ensure that a date is faithfully observed, what phrase must be included?
Time is of the essence
If the type of deed is not specified, the seller would be allowed to use which deed types, depending on the particular state?
A special warranty deed or a quit claim deed, depending on the particular state
