Chapter 7: Prep And Review Of Real Estate Contracts Flashcards
What is Caveat Emptor?
A doctrine which provides that a seller, absent some express warranty, is not liable to a buyer or any conditions regarding the title or improvements to the land existing at the time of transfer.
What is Closing?
Consummation of a real estate purchase and sale transaction: date set forth in a real estate contract on which the parties agree to perform all the promises of the contract.
The date on which ownership of the real property is transferred from seller to purchaser and the purchaser pays the seller the purchase price for the real property.
What is Condition Precedent?
Condition in a contract that must be satisfied in accordance with the terms of the contract before one or both of the parties are required to perform their contractual obligations.
What is Earnest Money?
Money paid by the purchaser at the time the real estate contract is signed.
The money may be used as a down payment on the purchase price or may be retained by the seller for damages in the event the purchaser defaults on the contract.
What is a Estoppel Letter?
A sworn statement of fact.
What is Execution?
The signature of a party to a legal document. The act of signing a legal document.
What is a Option?
A contract by which an owner of property, usually called the optionor, agrees with another person, usually called the optionee, that the optionee shall have the right to buy the owner’s real property at a fixed price within a certain time on agreed terms and conditions.
What is the Parol Evidence Rule?
Rule of evidence providing that a written agreement is the best and only evidence of the agreement between the parties and that the parties are not permitted to bring in oral testimony regarding other agreements concerning the transaction.
What is a Short Sale?
A sale of real property where the mortgage lender agrees to release its mortgage for less than what is due.
What is “Time is of The Essence”?
A provision contained in a contract that requires strict performance of the contract by the date or dates provided therein.
What does it mean to be “Underwater?”
When a mortgage balance is greater than the value of the real property securing the mortgage.
