Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Real Estate Sales Exam > Chapter 5 - Contracts > Flashcards

Chapter 5 - Contracts Flashcards

1
Q

This type of contract is expressed in words, either oral or written.

A

Express contract; listings, purchase agreements and leases.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Bilateral contract is promise for a ______.

A

promise

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Unilateral contract is a promise for an ____.

A

act

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

An exclusive listing contract is a _____, _____, _______ contract.

A

expressed, bilateral, executory contract

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

4-5 elements of a contract; performance and money don’t count as part of it.

A
  1. capacity
  2. mutual consent
  3. legality
  4. consideration
  5. (in real estate) written; due to statute of frauds
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

A buyer can withdraw his or her offer at any time _____ to receiving communication (in writing, personally, or mail) of its acceptance and receive a refund of the money deposited.

A

prior to receiving communication

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

An illusory contract is one in which the terms are not definite and certain, therefore the contract is __________.

A

unenforceable

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

If a contract is signed under duress, it is _______.

A

voidable

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

________ ___________ in a contract is anything of value given by one party given by one party to another party to make the agreement binding.

A

Valuable consideration; anything adequate, valuable, good and sufficient related to consideration.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

______ of ______ requires most real estate contracts to be in writing.

A

Statute of Frauds

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Any contract (such as personal property contracts, aka leases) that can’t be performed within _______ from the date of signing must be in writing.

A

a year

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

An _________ is the transfer of a person’s right in a contract to another party.

A

Assignment; any contract, unless it calls for some personal service, can be assigned if the contract does not state otherwise.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

A ___________ is the substitution or exchange (by mutual agreement of the parties) of a new obligation or contract for an existing one with intent to cancel the old contract.

A

Novation; the substitution, by agreement, of a new contract for an old one.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

_________ is the canceling of an offer to contract by the original offeror.

A

Revocation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

When a contract is _________ rescinded, the deposit must be returned to the buyer immediately.

A

mutually rescinded

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Contract can be cancelled due to Operation of Law (according to Statutes)

A
  1. illegality
  2. impossibility of performance
  3. rejection by bankruptcy
  4. failure of key contingency
  5. statute of limitations
17
Q

What must/can the seller do to a buy who entered a legally binding purchase contract, but backed out within a week.

A
  1. sue buyer for money damages
  2. return deposit to the buyer
  3. must attempt to resell ASAP to minimize damages
18
Q

What are the 4 remedies for a breach?

A
  1. acceptance of breach
  2. unilateral rescission
  3. action for dollar damages
  4. possible action for specific performance
19
Q

acceptance of a breach

A

no legal action taken

20
Q

In a _________ _________ breach, the wrong party 1. discloses the wrong and 2. restores everything of value to the offending party.

A

unilateral rescission

21
Q

A __________ __________ __________ sets, in ADVANCE, a specified amount of money as compensation if there is a breach.

A

Liquidated damages agreement

22
Q

The currently award for liquidated damages on a purchase agreement form is a maximum of __% (by law) of the home purchased price.

A

3%

23
Q

_______ ________ means that the party causing the breach is, through court action, forced to perform the terms of the contract.

A

Specific performance

24
Q

A promissory note secured by a deed of trust, a postdated check, or an unsecured promissory note could deb used by a buyer as an earnest money deposit in _______ real property.

A

Purchasing

25
Q

The ______ _________ is the most important contract in the real estate field!

A

purchase agreement; previously known as the deposit receipt; full name: California Residential Purchase Agreement and Joint Escrow Instructions

26
Q

What does the purchase agreement include?

A
  • percentage of commission
  • can fill it in with pen or just type it
  • has three copies (aster, buyer’s and seller’s)
27
Q

What happens when the liquidated damages clause is initialed by both the buyer and the seller, and the buyer defaults? It’s a CAR Purchase Agreement form.

A
  • seller may retain the deposit (up to three percent of the sale price)
  • split 50/50 between seller and broker.
28
Q

If a seller rescinds a contract because a buyer defaults, the earnest money deposit must be returned to the buyer if the parties DID/DID NOT initial the liquidated damages clause in the purchase contract.

A

DID NOT

29
Q

Convents are ______.

A

promises between the parties to a contract.

30
Q

The _______ ________ _________ form is used as an addendum to either the Residential Purchase Agreement, another offer form, or the counter offer form.

A

Purchase Agreement Addendum

31
Q

What is errors and omissions insurance for?

A

It’s the liability insurance (usually paid for by the salesperson at close of escrow) that brokers and salespeople should carry in order to pay for any costly lawsuits.

32
Q

In a counter offer, the offer becomes the ________.

A

Offeror

33
Q

If an agent fails to disclose known defects in a property to the buyer, the buyer can file civil action against the agent within _____ years.

A

2 years

34
Q

The _____ is primarily responsible for disclosing the presence of Mello-Roos tax liens or other assessments.

A

seller

35
Q

Which six zones does the Natural Hazard Disclosure Statement cover?

A
  1. Seismic
  2. Earthquake Fault
  3. Wildland Fire
  4. State Responsibility
  5. Flood
  6. Damn Inundation
36
Q

In addition to disclosing any known environmental hazards on the TDS, the seller and his/her agent should provide the buyer with the pamphlet entitled “_________ ________: _ ____ ___ _________, _______, ______, and _____,” which includes sections on asbestos, lead, mold, formaldehyde, and radon. The Environmental Hazards Guide does NOT include fire, flood, or earthquake information.

A

Environmental Hazards: a Guide for Homeowners, Buyers, Landlords, and Tenants

37
Q

Supplemental Statutory and Contractual Disclosures are usually used for things not provided for in the Real Estate Transfer Disclosure Statement, such as ….

A

insurance claims affecting the property

38
Q

An ______ is a right to purchase a property upon specified terms within a specified time period, which is granted in exchange for money.

A

Option
Optioner: seller
Optionee: potential buyer; who can transfer his share

Real Estate Sales Exam (33 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions