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RE Licensing Exam > contract and agency > Flashcards

contract and agency Flashcards

1
Q

express contract

A

stated/written agreement between two parties

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2
Q

implied contract

A

exists based on the parties’ actions or behaviors instead of their words or a written agreement.

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3
Q

bilateral contract

A

both parties have obligation

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4
Q

unilateral contract

A

only one party makes a promise

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5
Q

offer and acceptance

A

An offer is a promise made by one party requesting something in exchange for that promise. Acceptance is agreeing to be bound by the terms made in the offer. It’s sometimes referred to as mutual agreement or a meeting of the minds.

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6
Q

Consideration

A

Valuable consideration may consist of an exchange of money for a promise, exchange of an item of value for money, or an agreement to do or not do something. Good consideration, such as love and affection, is intangible but is still valuable consideration.

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7
Q

legal compétence

A

the legal and mental capacity to enter into a contract. If one of the parties doesn’t have legal capacity and enters into a contract anyway, the contract is voidable only by the party
lacking capacity. Legal competence refers to being of the age of majority as well as otherwise having mental
capacity.

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8
Q

legal purpose

A

all contract must be for a legal purpose or they are void

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9
Q

consent

A

all parties must enter in contract voluntarily with no undue influence or duress.

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10
Q

assignment

A

substitution for one party, still responsible for contractual responsibilities

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11
Q

novation

A

substitution for one party and new contract. release from responsibility

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12
Q

executed contract

A

all parties completed the terms of contract and its performed.

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13
Q

executory contract

A

uncompleted contract

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14
Q

voidable contract

A

one that appears valid, but one or both parties have a legal right to cancel it. This could be because
one of the parties lacks legal competence or because a mistake or misrepresentation falsely led one of the parties to agree to the contract. The contract is voidable by the incompetent or misled party but enforceable against the other party.

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15
Q

unenforceable contract

A

may be valid but is unlikely to stand up in court.

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16
Q

breach of contract

A

when party fail to meet contract obligations

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17
Q

unilateral rescission

A

A rescinded

contract is terminated and the parties are legally returned to the positions held before the contract existed.

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18
Q

termination in performance

A

when all parties have completed all contract terms.

19
Q

partial performance

A

terms and written acceptance by the party agreeing to partial performance

20
Q

Substantial performance

A

terms are mostly performed but certain details may be lacking

21
Q

impossibility of performance

A

in which an unforeseen situation (such as destruction of the property) makes contract performance difficult, impractical, or impossible

22
Q

mutual agreement

A

parties to cancel the contract and release each other from its terms

23
Q

operation of law

A

including a minor voiding a contract or due to lack of mental competence, fraud, or the death of one of the parties

24
Q

indemnification clauses

A

section in contract that release various parries from liability or loss

25
Q

Time is of the essence

A

means that parties agree to strictly adhere to the deadlines listed in the contract.

26
Q

statute of limitations

A

limits the time frame in which a party can file a lawsuit relative to the contract.

27
Q

amendment

A

a change to existing terms and conditions

28
Q

addendum

A

is an addition to existing terms and conditions

29
Q

escalator offer

A

buyer agree to beat any offer by specific amount

30
Q

earnest money

A

liquidated damage. if seller accept earnest money deposit as liquidated damage, buyer is relieved of any liability or legal action related to contract breach.

31
Q

equitable title

A

not equal ownership.

it mean someone’s right to get full ownership when conditions are met.

32
Q

contingencies

A

conditions must be met before agreement of sale is complete such as home sale, home inspection, financing or mortgage, or appraisal.

33
Q

option contract

A

offer to purchase real estate without obligation to buy it

usually optionee (buyer) pay option fee

34
Q

right of first refusal

A

potential buyer has first right to make offer and purchase property when owner decide to sell it.

35
Q

installment sales contract

A

seller financing, installment payments. seller will not take all sell proceeds at one time.

36
Q

customer

A

someone who work with real estate licensee but isn’t represented

37
Q

principal

A

party to transaction where licensee represents.

other word: client

38
Q

general agent

A

responsible for handling all dealings in a given area on behalf of a client (e.g., property manager).

39
Q

special agent

A

has limited authority to act on a client’s behalf (e.g., real estate agent, escrow officer) for a single transaction.

other word: limited agent

40
Q

universal agent

A

has broad authority to act for principal such as general power of attorney

41
Q

dual agent

A

also known as single license dual agent

one licensee who represent both buyer and seller in one transaction. must be informed consent.

not allowed in TX

42
Q

designated agent

A

a licensee who’s appointed by the firm’s

broker to represent one party. This allows both the buyer and seller to be represented by the same brokerage firm

43
Q

fiduciary duty

A

OLD CAR

  • Obedience
  • Loyalty
  • Disclose
  • Confidentiality
  • accounting
  • reasonable skill and care

RE Licensing Exam (8 decks)

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