Chapter 3
According to the Loan Assumption Addendum, if the buyer does not deliver the credit information within the required time, the seller has how many days to terminate after expiration for the time of delivery?
The answer is 7.
A married buyer wishes to purchase a home as separate property. Which of the following is an appropriate way to identify him on the contract?
The answer is John Doe, as separate property.
In which paragraphs or forms would you address the fact that the buyer will be acquiring the eight-burner freestanding propane grill on the pool deck as part of the transaction?
The answer is Non-Realty Items Addendum and paragraph 22.
Which TREC form should be used if the buyer wishes to include personal property such as a piece of furniture displayed in a home in the purchase price?
The answer is The Non-Realty Items Addendum.
A buyer wishes to get a USDA guaranteed loan. Which form should the agent use to address that type of financing?
The answer is Third Party Financing Addendum.
If a buyer is obtaining a new conventional mortgage, which of the following will be checked in paragraph 3?
The answer is Third Party Financing Addendum.
When property owned by a married couple is being sold, what is the BEST way to identify the sellers?
The answer is Thomas Bud Smith and spouse Mary Ann Smith.
The sellers want to sell the refrigerator to the buyers. How should it be noted in the contract?
The answer is Use the Non-Realty Items Addendum.
In paragraph 3 of the One to Four Family Residential Contract, the sales price is the sum of the cash portion of the sales price
The answer is and the sum of all financing.
Why is the marital status of the parties required to be disclosed in the TREC One to Four Family Residential Contract?
The answer is because Texas is a community property state.
If the buyer wants to be sure the fireplace screen stays with the property, the buyer's agent should
The answer is do nothing; it is already in the contract.
Which of the following is included in paragraph 2 of the TREC One to Four Family Residential Contract?
The answer is excluded fixtures and accessories.
The option fee paragraph in the TREC One to Four Family Residential Contract requires either a negotiated response or a selection for all of the following EXCEPT
The answer is how long the buyer has to provide the option fee.
What happens if buyer's credit is not approved under the TREC Third Party Financing Addendum, and the buyer gives timely notice to the seller?
The answer is the contract will terminate and the buyer will get the earnest money.
The down payment in a transaction is indicated
The answer is in paragraph 3A of the contract.
How should the TREC One to Four Family Residential Contract be filled out if the property is not located within a city?
The answer is in the blank for "city" put "unincorporated" or "none."
What information is NOT required to fill out paragraph 3 of the TREC One to Four Family Residential Contract?
The answer is interest rate.
What should a license holder do if the seller wishes to retain an item not specifically listed as an improvement or accessory in paragraph 2 of the TREC One to Four Family Residential Contract?
The answer is list the item as an exclusion in paragraph 2D.
A seller wishes to keep an item listed as an accessory. How should the TREC One to Four Family Residential Contract be filled out?
The answer is list the item under Exclusions.
The seller wants to keep the built-in, high-end stovetop. How should the seller's agent note that?
The answer is list the stovetop in paragraph 2, Exclusions.
Which of the following is not included in the legal description in paragraph 2 of the One to Four Family Residential Contract?
The answer is name and marital status of the parties.
Six days after executing a contract to buy a house, the buyer has been unable to get approved for a loan. Under the TREC Third Party Financing Addendum, he has seven days to get buyer approval. What is his best course of action if he is uncertain about getting timely approval and wants to get the earnest money back?
The answer is notify the seller before the close of business on the seventh day that he was unable to get approval.
A married buyer wishes to purchase a home as separate property. This will be indicated in
The answer is paragraph 1 of the contract.
The legal description of the property, improvements, accessories, and any exclusions to improvements or accessories are
The answer is paragraph 2.
Which of the paragraphs in the TREC One to Four Family Residential Contract addresses the sales price?
The answer is paragraph 3.
Which paragraph of TREC One to Four Family Residential Contract addresses whether the property is subject to an HOA?
The answer is paragraph 6.
The buyer wishes to obtain an adjustable rate mortgage. How should paragraph 1 of the TREC Third Party Financing Addendum be filled out?
The answer is per annum for the first year of the loan.
Under the TREC Third Party Financing Addendum, which of the following is NOT considered by the lender?
The answer is property condition.
If the property has a metes-and-bounds legal description, how should the property description in the TREC One to Four Family Residential Contract be filled out?
The answer is put N/A in the blanks for lot and block and attach the description to the contract.
Which of the following is NOT a form of financing listed on the Third Party Financing Addendum?
The answer is seller financing.
Which of the following types of financing is not addressed in the TREC Third Party Financing Addendum?
The answer is seller financing.
What information is required in paragraph 12 of the TREC One to Four Family Residential Contract?
The answer is seller's contribution to buyer's expenses.
The buyer has offered to assume seller's loan under the TREC Loan Assumption Addendum, so long as the lender does not charge more than a $1,000 loan assumption fee. The lender wants to charge $3,000 and the seller refuses to pay the difference. What can the buyer do?
The answer is terminate the contract and receive the earnest money.
The antique cabinet that holds dishes has been made to appear to be built into an alcove in the dining room by surrounding the alcove with a frame; however, the cabinet is not attached to the walls or the floor of the alcove. The buyer wants to include the item in the sale. In which paragraph or form should this be documented?
The answer is the Non-Realty Items Addendum and paragraph 22.
If a titled vehicle (e.g., pickup, utility tractor, old car) is part of the real estate transaction, which of the following is applicable?
The answer is the Non-Realty Items Addendum.
Under the TREC Loan Assumption Addendum, who gets the earnest money if the note holder fails to consent to the loan assumption?
The answer is the buyer.
Paragraph 2 of the TREC One to Four Family Residential Contract includes all of the following EXCEPT
The answer is the sales price.
Under the Seller Financing Addendum
The answer is the seller may terminate the contract and receive the earnest money if the buyer fails to provide credit documentation within the negotiated time period.
Which of the following is TRUE under the TREC Third Party Financing Addendum?
The answer is time is of the essence.
The buyer wants the free standing bookshelves in the study to be included in the sales price. How should the agent handle it?
The answer is use the Non-Realty Items Addendum.
The seller wishes to convey the washer and dryer, but the buyers wish to pay a nominal price for them and the sellers agree. What should the agent do?
The answer is use the Non-Realty Items Addendum.
The seller wishes to sell to the buyers all of the flower pots on the patio. What should the agent do?
The answer is use the Non-Realty Items Addendum.
What information is NOT needed to complete paragraph 23 of the TREC One to Four Family Residential Contract?
The answer is whether the option fee is refundable.
Paragraph 6 in the TREC One to Four Family Residential Contract deals with which of the following issues?
The answer is who pays for the title policy.