Unit 11: Real Estate Contracts Flashcards
A voluntary agreement or promise between legally competent parties
A contract
A contract is either expressed or implied and must be in
writing
What is the statue of frauds
All contracts for sale of real estate in MA must be in writing to be valid; verbal agreements are non-binding
Type of contract when two people make a promise; both parties agree to do something
Bi-lateral contracts
Only one person makes a promise hoping the other person will accept is this type of contract
Unilateral contract
Contracts remain as this when one or both parties still have an act to perform
Executory
Once all parties have fulfilled their promise, the contract becomes
Executed
A contract is considered to be ______ when it has all required elements
Valid
If a contract lacks one or more elements; no legal force
Void
A contract that has all the legal elements on its face but can be voided by one of the parties
Voidable
This contract cannot be enforced in court
Unenforceable - not in writing
Each party to a contract has certain rights and duties to fulfill
Performance of a contract (time is of the essence)
Transfer a contract to another person with this clause
Assignment
Substitution of a new contract for an existing contract
Novation
Once a seller accepts a buyer in writing, you have a contract.
This is a violation of any terms or conditions of the contract
Breach of contract
A buyer can ask the court to force a seller to go through with the sale and transfer of property as previously agreed with this:
Suit for specific performance
If the buyer signs the P&S, all conditions are met including
home inspection, financing approved, and title search
If a buyer backs out of the contract, they would be subject to this
Liquidated damages- forfeit their deposit
How long is the statue of limitations in MA
7 years
Once a seller accepts an offer in writing it is a ______ __________ Contract
Legally binding
Can a real estate agent accept or reject any offers?
NO- all must be presented to the seller
This has the same meaning as an offer
Binder
It is customary as good faith that money collected must be deposited into a :
Escrow account - Earnest money deposits
Co-mingling is
mixing customer assets with the brokers- not allowed
Once the buyer signs a contract to purchase real estate, they do not immediately receive the title but get this:
Equitable title
