Module 4

Question 1

A buyer’s evidence of good faith, submitted with an offer to purchase

Answer 1

Earnest money

Question 2

A unilateral contract where one party has the option to buy property at a preset price within a negotiated time period

Answer 2

Option

Question 3

An insurance policy to compensate or reimburse the insured against any losses sustained as a result of defects in the title

Answer 3

Title Policy

Question 4

A report outlining the current condition of the title – title report

Answer 4

Title Commitment

Question 5

A change that is made to a standard insurance policy

Answer 5

Endorsement

Question 6

The process by which boundaries are measured and land areas are determined; the on-site measurement of lot lines, dimensions and position of a house on a lot, including the determination of any existing encroachments

Answer 6

Survey

Question 7

Paragraph 6D of TREC’s promulgated contracts allow the buyer to object in writing to any matters that might prohibit a certain use or activity of the property

Answer 7

Objections

Question 8

One of the most important considerations when purchasing residential real property. TREC’s promulgated contracts stipulate that the buyer is purchasing the property “as-is”

Answer 8

Property Condition

Question 9

A statement of property condition provided to prospective buyers by the seller

Answer 9

Seller’s Disclosure Notice

Question 10

The amount of earnest money is negotiated between the

Answer 10

parties to the contract

Question 11

The Earnest Money paragraph has a

Answer 11

Time is of the Essence clause

Question 12

Seller shall deliver the Title Commitment for title insurance within how many days after the Title Company receives a copy of the contract .

Answer 12

20

Question 13

The T-47 is used with the

Answer 13

seller’s existing survey

Question 14

The Texas Real Estate License Act requires that license holders advise buyers to have

Answer 14

an abstract examined or to obtain title insurance

Question 15

The inspector is to be a

Answer 15

TREC licensed inspector or another person otherwise allowed by law

Question 16

If the lender required repairs exceed 5% of the sales price, the buyer may

Answer 16

terminate the contract and receive a refund of earnest money

Question 17

Addendum for Seller’s Disclosure of Lead-Based Paint and Lead-Based Paint Hazards
Paragraph C Allows the buyer to waive the right

Answer 17

to a lead inspection

Question 18

Addendum for Seller’s Disclosure of Lead-Based Paint and Lead-Based Paint Hazards Paragraph D requires the buyer to acknowledge receipt of what pamphlet

Answer 18

“Protect Your Family From Lead in Your Home.”

Question 19

If a buyer is concerned about the presence of endangered species, toxic substances or wetlands, the agent should attach what form

Answer 19

Environmental Assessment, Threatened or Endangered Species and Wetlands Addendum

Question 20

Compensation from a Residential Service Company must be

Answer 20

disclosed