Law of Contracts Flashcards
Real Estate Center
Created by the Legislature in the 1970s to collect and compile data about real estate in Texas.
Broker-Lawyer Committee
Established by TREC to write mandatory residential contract forms for license holders.
Texas Real Estate Commission
Created by the Legislature in 1949 to carry out the provisions of TRELA.
Real Estate Recovery Trust Account
Administered by TREC to protect aggrieved individuals who suffer a monetary loss due to illegal acts of license holders.
What are TREC’s two promulgated lease forms.
-Buyer’s Temporary Residential Lease
-Seller’s Temporary Residential Lease
Buyer’s Temporary Residential Lease
for use when the buyer occupies the property for no more than 90 days prior to closing.
Seller’s Temporary Residential Lease
for the use when the seller occupies the property for no more than 90 days after closing.
Right of refusal
gives the tenant the right to purchase the leased property by matching or bettering any offer before the property will be sold to someone else.
DTPA define words:
Services
means work, labor or repair of goods. Brokerage is a service.
Seller Disclosure not needed when
-pursuant to a court order or foreclosure
-by a bankruptcy trustee
-to a lienholder by the owner of a property
-by a mortgage (lender) who has acquired the property through a foreclosure or a deed in lieu of foreclosure.
-by a fiduciary (ie. an executor, trustee or guardian) in the course of administration of a decedent’s estate, guardianship, conservatorship or trust.
CO-Ownership
-from one co-owner to one or more other co-owners
-to a spouse or to a person in the lineal line of consanguinity (ie. parents, grandparents, children) of one or more of the transferrers
-between spouses resulting from a divorce decree or a property settlement agreement incident to a divorce decree.
Does to or from any government entity sale of real property need a Seller’s Discosure Notice doc?
No
Does a new property need a Seller’s Disclosure Notice?
No
Where the value of the dwelling does not exceed five percent of the value of the property
No Seller’s Disclosure Notice due to purchasing the real property for the land only.
Define personal property.
Things of a temporary or movable nature are not part of the real property.
If personal property is being transferred along with real property it is done on what document?
Bill of Sale is generally used to accomplish the transfer, which would normally accompany the deed.
Four economic characteristics of land are:
-Scarcity
-Modification
-Fixity
-Situs
Define modification.
refers to the fact that value is affected by man-made changes to the land.
Forms of real estate ownership.
-Estate in severalty
-Co-Ownership
-Trust
Estate in severalty
it involves ownership of real estate by one individual or entity.
Co-Ownership
involves ownership of real estate by two or more entities
Trust
a property may be placed in a trust, with ownership conveyed to a trustee for the benefit of others
Identify the example:
Doug, a single person, purchased a vacation condo. Doug’s interest is an _______.
Estate in severalty
Identify the example:
Big-Tex Inc(BIT). purchased a home for rental and investment purposes. While BIT has numerous stockholders, the firm is treated under the law as a distinct entity. The Big-Tex interest is an __________
Estate in severalty
Sole proprietorship
a venture that is owned by one indivdual.
General partner
workforce
Limited partner
investors
Cooperative defined
owners do not own a specific unit
Who owns a cooperative complex?
corporation
What is prohibited in advertising.
Limitation or preference based on race, color, national origin, religion, sex, familial status, or handicap.
Familial status
married with no children
Contract
An agreement between two or more parties to do something or to refrain from doing something.
Option
an agreement between a buyer and seller or landlord and tenant.
Elements of valid and enforceable contract.
-Competent parties
-Officer and acceptance (mutual agreement)
-Legal purpose
-In writing (when required by law)
-Consideration
Non-Competent Parties
A person who enters into a contract under the influence of drugs or alcohol could be considered mentally impaired.
Consideration
is defined a something given in exchange for a promise.
Statute of Frauds
contracts for the conveyance of an interest in real estate or lease for a term more than one year must be in writing.
If the contract is not writing it would be valid but ______.
not enforceable.
Contract is executed
signing and Communication establish the effective date
When the sale finally close, the contract is _______.
fully executed.
Police power
the right of the government to regulate and control the way land is used. ei: zoning
Buffer Zone
an area of land separating one land use from another, such as residential from commercial.
Escheat
If a person dies intestate (without will) and without heirs, the government will take title to his real property under the right of escheat
Quitclaim deed
is one with no guarantees, warranties, or covenants.
Abstract Title
is a complete history of the title of a piece of property that includes deeds, easements, liens, foreclosures, wills, marriages, deaths, life estates fee simple estates, and anything else that may have ever recorded about a property.
Encumbrance
a claim, lien charge or liability attached to and binding real property.
If a buyer has concerns about possible contamination of a potential property, the buyer or the lender may opt to have an ________________(ESA).
Enviromental Site Assessment
There are four types of leaseholds estates:
-Estate for years
-Periodic Tenancy or Periodic Estate
-Tenancy at sufferance
-Tenancy at will or estate at will
