Unit 11: Real Estate Contracts

Question 1

This prescribes the amount of time parties have for bringing certain kinds of legal action

Answer 1

statute of limitations

Question 2

implied contract

Answer 2

actions indicate intent, no implied contracts in transfer of any interest in real estate

Question 3

means oral or written. to be enforceable, real estate contracts must be express written documents. bilateral, unilateral, promise exchanged for performance, only one party is bound.

Answer 3

express (declared) contract

Question 4

Meets all legal requirements, contains all essential elements. this is a ___ document

Answer 4

valide

Question 5

no legal effect, not enforceable by either party. lacks one or more of the essential elements in a valid contract. example an oral contract for the purchase of real estate. this is a ___ contract

Answer 5

void

Question 6

a _____ contract appears valid, but one party may disaffirm becasue the party is a minor or subject to duress, fraud, or misrepresentation

Answer 6

voidable

Question 7

a mutual agreement must have a _____ and _____. a contract becomes binding upon communication and acceptance

Answer 7

offer, acceptance

Question 8

____ is any change to the conditions in the offer. Legally, a rejection terminates the original offer (usually carries forward most terms from the original offer).

Answer 8

Counteroffer

Question 9

_____ is known as money, promises, or something of value. Earnest money is liquidated damages, it is NOT this.

Answer 9

Consideration

Question 10

Earnest money is an essential element

Answer 10

false

Question 11

5 Essential elements of a real estate contract

Answer 11

Competent parties, mutual agreement, lawful objective, consideration, in writing and signed

Question 12

a(n) _____ contract is created upon offer and communication of acceptance. the duties are not fully performed, its incomplete

Answer 12

executory

Question 13

Both parties agreed, and they are waiting for the excecution. this is the _____ stage

Answer 13

executory

Question 14

_____ stage is when duties are fully performed

Answer 14

executed

Question 15

additional material attached to and made part of an offer (disclosures and contingencies)

Answer 15

addendum

Question 16

modifiaction of an existing contract by mutual agreement. must be written and signed by all parties

Answer 16

amendment

Question 17

an ______ transfers contract rights, but not liability

Answer 17

assignment

Question 18

If a duty required by the contract that cannot be legally performed, contract becomes ____

Answer 18

void

Question 19

contract is terminated if a _____ cannot be met, and the buyer’s earnest money is returned

Answer 19

contingency

Question 20

If there is mutual recession or contingency can’t be met, earnest money is typically returned. True false

Answer 20

true

Question 21

____, which are not contracts, terminate upon the death of parties

Answer 21

offers

Question 22

Real estate contract that creates the conditions for closing

Answer 22

purchase contract

Question 23

method of communiation of acceptance is determined by the contract or by ___ law

Answer 23

state

Question 24

The right to have the first opportunity to purchase or lease real property. May be included in condominium or cooperative rules, or leases. Gives owner more flexibility than an option because there is typically no set price. The seller can sell to others if the first right is not exercised

Answer 24

Right of first refusal

Question 25

have a set price and set term.

Answer 25

option

Question 26

a ____-_____ is when an owner sells property to investor and then leases it back. Converts equity to working capital without giving up possession.

Answer 26

Sale-leaseback