Contracts Flashcards
Statues of frauds
Requires that certain types of contracts be in writing, such as the property of ownership transfer, be in writing for being legally enforceable and prevent injury from fraudulent conduct
Offer and acceptance
0ccur when the seller accepts a buyer’s offer on the home, usually by signing a Purchase and Sale Agreement already signed by the buyer.
Consideration
is something offered by one party and accepted by another
eg. the buyer promises to buy the full purchase price, and the seller primes to transfer a marketable title through the delivery of a deed
Legally competent parties
have legally and mentally capacity to enter into a contract
Legal purpose
means that the contract results in a legal outcome
Voluntary
means the parties enter into an agreement voluntary
A contract is a…
legally binding agreement
executory contract
is a contract not get fully perform
executed contract
has been fully perform
Breach of contract
occurs when one party fails to meet contract obligations.
Unilateral recession
It when a breach of contract occurs and the innocent party may unilaterally terminate the contract
specific performance
when money damages for breach will not be satisfactory
Liquidated damages
A definite amount set forth in a contract to be paid by the party breaching the contract
Contract termination
one party ends the contract before its fully perform. the termination may own duties or compensation to the party
contract recession (cancelation)
is one person breaches the agreement, one person has the right to rescind the contract
assignment
means to transfer contractual rights or duties to a new party
Novation
one contract is substituted for another
The uniform electronic transactions act (UETA)
It gives electronic signatures the same weight as one that is in sign-in paper
unilateral contract
only one person makes a promise.
Bilateral contract
is a promise for a promise
Option contract
is and offer to purchase a specific piece of real estate without the obligation to buy it.
in and option contract the potential buyer is called…?
and optionee
In and option contract the seller is called?
optionor
ACCELERATION CLAUSE
Clause used in an installment note and mortgage (or deed of trust), which gives the lender the right to demand payment in full upon the happening of a certain event, such as failure to pay an installment by a certain date, change of ownership without the lender’s consent, destruction of the property (see Waste), or other events which endangers the security of the loan
Arbitration clause
requires the parties to solve their disputes through an arbitration process
Indemnification
one or both parties commit to compensate the other for any harm, liability, or loss arising
A statues of limitation
sets a time frame in which a party can file a lawsuit relative to the contract
The party extending an offer is called?
offeror
The party receiving the offer is called
Offeree
Acceptance occurs when all parties?
have signed the contract
Binding acceptance
happens when the signed contract is delivered back to the offeror
acceptance and binding acceptance must take place within
the dates specified in the contract
Contingency
are conditions that must be met before the agreement for sale is complete and enforceable
The greater the number of contingencies on and offer,…
The less attractive it is to the seller
Severability clause
tells what happens when part of a contract is unenforceable. Most basic severability clauses state that if one part of a contract is unenforceable, then that clause will be “severed” from the contract
Statues of limitations
Overton contracts, including purchase agreements, have a 3-year status of limitation
Recordkeeping
Brokers must keep all real estate forms of for minimum of 5 years
A sales contract
Is a document that buyers and their agents used to prepare the purchase offer to the seller others names that are also used for a sales contract is called a purchase agreement, earnest money agreement, the offer, offered to purchase, contract of purchase and sale.
The sales contract describes in detailed agreement between the buyer and seller of the home that the buyer wants to purchase
The purchase price
It presents the buyer’s offer
The settlement section
Allows the buyer to specify a settlement date
The payment term
Indicates the amount of artist money the buyer is putting down in the number of deposits
Remember the earnest money deposit can be either in the form of a ______ and that initial deposit must be delivered with the offer
Personal check
The inclusion/exclusion
Is used by buyers and sellers to identify items to be included with or excluded from the cell the property
As a real estate licensee is important that you verify the license status of the recommended service providers on a
Yearly braises
You must include also the last verified Day of service
The recommendation must include a link to a site where the people can look up the license status of each recommended provider
The buyer has the right to make a final inspection of the property within____ days before settlement
5 days
A contingency
Is a condition that must be met before the cell’s contract is completed and enforceable. The contingency usually indicates the actress necessary to remove the condition
The guarantee found
Notice the buyers that they are protected by the Maryland real estate commission for loses of up to $50,000
Mortgage contingency
Protects the buyers earnest money in the event the buyer is unable to obtain financing
Appraisal contingency
Is the property does not a price at or more than the selles prize the buyer can terminate
Sales contingency
The buyer has made the offer to purchase based on the buyer’s career and property selling
Insurance contingency
If the buyer is unable to obtain insurance for a specific amount, the buyer can terminate and receive a refund
inspection contingency
Allows the buyer to terminate if an Asia arrives during the inspection that cannot be successful in negotiated
The Maryland Real Estate Commission’s Code of Ethics
states that real estate licensees must make reasonable efforts to discover all material facts about each property they list.
In which section of the Residential Contract of Sale do buyers indicate the amount of earnest money they are putting down?
Payment term section
In which section of the Residential Contract of Sale do buyers indicate the price they are offering for the property?
Purchase price
In the Estate section of the Residential Contract of Sale, a property can be conveyed in either _______________ or subject to annual ground rent.
Fee simple
What is the Forest Conservation and Management Program?
A program designed to encourage the preservation or development of land for productive woodland purposes
In situations where the buyer is not a first-time Maryland homebuyer, who is generally responsible for paying recording, state, or local transfer taxes associated with the sales transaction?
The buyer and seller split the cost equally.
Which section of the Residential Contract of Sale states how the brokers in the sales transaction will be compensated?
The brokers fee section
Which section of the Residential Contract of Sale identifies miscellaneous charges that must be adjusted to the day of settlement?
The adjustment section
Which section of the Residential Contract of Sale states that the seller is responsible for maintaining the property in the same condition as it is on the date of contract acceptance?
The Condition of Property and Possession section
Miscellaneous charges that must be adjusted to the day of settlement are referred to in the Residential Contract of Sale as ________________________.
Adjustment
Which section of the Residential Contract of Sale states that the seller must not negotiate a new lease or renew any existing lease that extends past the settlement or possession date without the buyer’s written consent?
The lease section
In which section of the Residential Contract of Sale is breach of contract defined
The default section
What’s the purpose of the Military Installation section in the Residential Contract of Sale?
To give notice to buyers that the property may be subject to high noise levels
All references to time of day in the Residential Contract of Sale assume which time zone in the U.S.?
Eastern time
Which section of the Residential Contract of Sale states that the contract will be governed by the laws of the State of Maryland?
The entire agreement section
When does the sales contract become a binding agreement?
Only after both parties have signed it
