Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Law Of Contracts > Test > Flashcards

Test Flashcards

You may prefer our related Brainscape-certified flashcards:
Civil Procedure 1L flashcards MBE flashcards MPRE flashcards
1
Q

TREC only has two promulgated lease forms:

A
  1. Buyers Temporary Residential Lease - for use when the buyer occupies the property for no more than 90 days
  2. Seller’s temporary residential lease - for use when the seller occupies the property for no more than 90 days after closing.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Some residential leases contain a RIGHT OF FIRST REFUSAL:

A

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.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

DTPA considers brokers a _____?

A

Deceptive Trade Practicing Act

A Service - means work, labor, or repair of goods. BROKERAGE IS A SERVICE

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

If personal property is being transferred along with real property, a ______ is generally used to accomplish the transfer, which would normally accompany the deed.

A

BILL OF SALE

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What are the FOUR economic characteristics of land?

A
  1. Scarcity
  2. Modification
  3. Fixity
  4. Situs
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

If only one signature is required on a deed conveying full ownership of the property to another, the seller owns an __________.

A

Estate in Severalty

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

A _______ is a venture that is owned by one individual. (Business organizations)

A

Sole Proprietorship

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Owners within a ________ do not actually own a specific unit.

A

Cooperative

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

What is prohibited in advertising?

A

Limitation or preference based on RACE, COLOR, NATIONAL ORIGIN, RELIGION, SEX, FAMILIAL STATUS, or HANDICAP.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

A ______ is an agreement between two or more parties to do something or to refrain from doing something.

A

CONTRACT

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What is a UNILATERAL contract?

A

Under an option, the seller must sell if the buyer chooses to buy. Only one party is obligated to perform. A unilateral contract is said to lack mutuality.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Five essential elements must be considered valid and enforceable:

A

COLIC COLIC COLIC

  1. Competent parties
  2. Offer and Acceptance
  3. Legal Purpose
  4. In Writing
  5. Consideration

COLIC COLIC COLIC

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

A person who enters into a contract under the influence of drugs or alcohol could be considered ________.

A

Mentally Impaired

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

In order to comply with ______ __ _____, contracts for the conveyance of an interest in real estate or lease for a term of more than ___ year must be in writing.

If the contract is not in writing, it would be valid, but not enforceable.

A

Statute of Frauds

One

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What is consideration?

A

Defined as something given in exchange for a promise. There is no requirement that the consideration be in the form of money. Consideration in a contract could be nothing more than a promise made by one party in exchange for a promise made.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

When the sale is closed, the contract has been __________.

A

Fully executed.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What is police power in real estate?

A

The right of the government to regulate and control the way land is used.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What is a BUFFER ZONE?

A

An area of land separating one land use from another, such as residential from commercial.

Shopping center
Apartments

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Easements may be created by:

A
  • Necessity: The courts may award an easement to a property owner who has no legal access to his or her land. (Usually in the case of “landlocked” property)
  • Condemnation - The government, under its power of eminent domain, takes an easement.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

An ENCUMBRANCE is:

A

A claim, lien, charge, or liability attached to and binding real property.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

What is a ESA?

A

ENVIRONMENTAL SITE ASSESSMENT

If a buyer has concerns about possible contamination of a potential property, the buyer or the lender may opt to have an ESA performed on the property to determine if it is environmentally challenged.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

A contract is considered DISCHARGED when all parties have performed. In real estate sales, performance (full execution) is most often achieved at the closing of the transaction.

A contract may also be discharged if:

A

The destruction of property.

Ex: fires, earthquakes, acts of war, hurricanes.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

FOUR types of LEASEHOLD ESTATES:

A
  1. Estate for years - definite beginning and start date
  2. Periodic tenancy or periodic estate - a lease that renews automatically
  3. Tenancy at sufferance - an interest in leased property when the holdover tenant (one use lease has ended and refuses to leave the property) is occupying the leased property against the owners will.
  4. Tenancy at Will or Estate at will - A very loose agreement where a tenant occupies real estate with the permission of the owner for an uncertain or unspecified length of time; this is a very loose agreement.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

What is a PERCENTAGE LEASE?

A

In retail, a percentage lease obligates the tenant to pay base rent and a percentage of the gross sales.

25
Q

What is an assignment?

A

An assignment of a lease occurs when a tenants rights and liabilities are transferred to another. In most cases, the landlord reserves the right to approve the new tenant. When the assignment is complete, the original tenant is no longer obligated under the lease.

26
Q

What is a LEASE OPTION or a LEASE WITH THE OPTION TO BUY?

A

Allows a tenant to buy the property at a preset price and terms for a given period.

27
Q

An offer can be communicated by:

A
  • Phone
  • Fax
  • E-mail
  • Letter
  • Hand delivery
28
Q

ALL OFFERS MUST BE ______

A

PRESENTED

29
Q

When should the communication or submission of an offer be?

A

Promptly. The license holder’s duty is to keep the principle or client informed at all times of material information.

30
Q

In most cases, a ________ is a rejection of the original offer.

A

COUNTER OFFER

31
Q

ACCEPTANCE of an offer means that the accepting party does so with ________ to the contract what so ever.

A

NO CHANGE

Any change, no matter how trivial, turns the offer into a counteroffer.

32
Q

An agent should NEVER discourage a party from consulting an attorney for advice in a transaction.

A

An agent should NEVER discourage a party from consulting an attorney for advice in a transaction.

33
Q

What is the most common type of financing?

A

The most common type of financing is obtained from a third party, such as a mortgage company or a bank.

34
Q

What happens to earnest money when the contract is signed by all parties, and acceptance is communicated?

A

The earnest money is deposited in an escrow account.

35
Q

What is a special provision?

A

A blank space on a standard contract form that is usually provided to allow for special provisions to the contract. The space is where terms can be addressed that are not covered in standard contracts or addenda forms.

36
Q

What must license holders make sure of when adding a special provision to a contract?

A

Should ensure that all provisions are FACTUAL and do not change the legal effect of the contract

37
Q

At closing, prorations for property taxes and property owner association fees will be calculated.

A

At closing, prorations for property taxes and property owner association fees will be calculated.

38
Q

What length of lease is the exception to the Statute of Frauds?

A

A lease agreement for one year or less are the exception. In such cases, AN ORAL LEASE FOR ONE YEAR OR LESS IS VALID AND ENFORCEABLE

39
Q

In the event of a default by buyer, the seller may have several options, which include:

A
  • Liquidated damages. The seller can choose to accept the buyers earnest money as liquidated damages, releasing all parties from any further obligation under the contract. Liquidated damages are damages that are established in the contract.
  • Specific Performance. The injured party files a court action seeking an order of the court directing the defaulting party to perform according to the terms of the contract. Specific performance is the only remedy that would possibly result in the full execution (closing) of the transaction.
40
Q

SELLER DISCLOSURE NOTICE

A

If buyer does not receive the notice, buyer may terminate this contract at anytime prior to the closing and the earnest money will be refunded to the buyer.

41
Q

What is a CONTINGENCY?

A

A provision in a contract that requires that’s a specific act or event happens for the contract to be binding on the party.

42
Q

SALE OF OTHER PROPERTY CONTINGENCY:

A

In this case, the seller and buyer agree that the purchase of the property is contingent on the sale and closing of the buyer’s existing property.

43
Q

Lead based paint:

A

Under federal law, all sellers of homes built before 1978 must provide to the buyer a disclosure of their knowledge of possible lead-based paint hazards.

44
Q

Addendum:

A

An addendum to a contract is an attachment that adds or further describes the rights and duties of the parties.

45
Q

Promissory Note:

A

A promissory note, also known as a real estate lien note, is the borrowers unconditional promise to repay and includes the amount borrowed, payment amount, due date, and rate of interest. The note is not generally recorded.

46
Q

Servicing:

A

Servicing includes sending monthly payment statements and collecting monthly payments, maintaining record of payments and balances, collecting and paying insurance ( and managing escrow and impound funds), remitting funds to the note holder, and following up on delinquencies.

47
Q

Blanket Mortgage:

A

Covers more than one piece of property. A builder may buy more than one lot in a new subdivision; he will do so with one loan. The loan is likely to contain a release clause, allowing the borrower to obtain partial releases of specific lots by making required lump sum payments.

48
Q

FHA MORTGAGE INSURANCE PREMIUMS

A

The buyer pays two premiums, an up-front premium at closing, and an annual premium.

49
Q

Texas Veterans Loan Program

A

VHAP

To participate in the program, the veteran obtains an FHA, VA, or conventional loan from a participating lender.

50
Q

The term RESIDENTIAL MORTGAGE LOAN ORIGINATOR (RMLO) is mandated by the SAFE act.

A

The term RESIDENTIAL MORTGAGE LOAN ORIGINATOR (RMLO) is mandated by the SAFE act.

51
Q

ECOA

A

Equal Credit Opportunity Act

Originally passed in 1974, ensures that all consumers are given an equal chance to obtain credit.

52
Q

Real property conveyed by will is called a ______.

A

DEVISE

53
Q

What is a PROBATE?

A

The formal judicial proceeding to prove or confirm the validity of a will, to collect the assets of the decedents estate, to pay the debts and taxes, and to determine the persons to whom the remainder of the estate is to pass.

54
Q

What is a quitclaim deed?

A

A deed is one with no guarantees, warranties, or covenants.

55
Q

What is an abstract of title?

A

An abstract of title is a complete history of the title of a piece of property that included deeds, easements, liens, foreclosures, wills, marriages, deaths, life estates, fee simple estates, and anything else that Mays have ever been recorded about a property.

56
Q

The Subrogation Clause

A

The subrogation clause enables the title company to assume the rights of a buyer with the respect to any claim against a seller if the title company has made payment to that buyer to satisfy that claim. In this manner, the property owner cannot collect from both the title company and the seller for the same issue.

57
Q

Section 8 of RESPA

A

Prohibits any person who, pursuant to any agreement or understanding, gives or receives a fee or a thing of value (including payments, commissions, fees, gifts, or special privileges) for the referral of settlement business. Payments in excess of the reasonable value of goods provided or services rendered are considered kickbacks.

58
Q

Notices - Paragraph 21

A

Many agents fail or refuse to fill in the contact information for their clients in paragraph 21, or they enter their own contact information so that they can stay in control of the flow of information. Either of these actions makes it difficult or the title company and the other party to forward information pertaining to the sale to everyone. Sometimes a title company may spend days trying to track down an agent so they can simply get the contact information for the seller or the buyer.

Law Of Contracts (1 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions