contracts

Each party is bound to a specific date for performance if a real estate sales contract contains:

A provision that time is of the essence.

A promise in exchange for a promise supported by consideration is the basis for:

A valid binding bilateral agreement.

One effect of a clause in a sales agreement that states that "time is of the essence" might be that:

All parties must attend to those details called for in the agreement in a timely manner.

What is a sum of money a buyer may submit with an offer to purchase known as?

An earnest money deposit.

The buyer gives the owner a $2,500 payment and a written agreement stating that, on June 1 of the following year, the buyer will purchase the property for $475,000 cash or the owner may keep the money. This transaction is known as:

An option agreement.

The party most likely to sue for specific performance in the purchase of real estate is the:

Buyer.

If during negotiations one party crosses out or alters any wording in a contract:

Each party must initial the change in the margin for it to be valid.

In April, Jones accepted an offer to sell his house to Brown. In June, Brown paid the purchase price and received a deed to the house and the keys. After June their contract was considered to be:

Executed.

Jones' offer to buy Brown's house has been accepted, but the actual sale will not take place for three months. Until then, their written sales contract is considered to be:

Executory.

To be valid, a listing contract must contain all of the following except:

Final contract price.

In order to be enforceable, a real estate contract must be:

In writing.

The earnest money accompanying a purchase offer:

Is not necessary to establish a valid contract.

The most important document in the sales process is the purchase contract because:

It provides the road map for the closing.

When a contract contains provisions outlining what money penalties will be levied against the party that refuses to perform, the amount specified is known as:

Liquidated damages.

When is a contract said to be discharged?

Once all of its terms and conditions have been met.

A written purchase agreement has been signed by both a buyer and a seller. The Uniform Vendor and Purchaser Risk Act states that until the buyer has either possession of or title to a property, responsibility for the physical condition of the property:

Remains with the seller.

The blueprint for the final transfer of title is found in the:

Sales contract.

The buyer has been held to be in default on a contract of sale. If buyer and seller had not agreed on liquidated damage, the seller could do which of the following?

Sue the buyer for compensatory damages.

A buyer paid $2,800 for an option to purchase a property within 90 days for $450,000. Within a month, the buyer made an offer to buy the property immediately for $425,000. Which of the following is true in this situation?

The owner may accept the offer for $425,000.

Jones put his house on the market. Brown made a written purchase offer that Jones accepted in writing. When is the contract valid?

When Brown is notified of the acceptance.

Jones goes into a restaurant and orders lunch. At the end of the meal, is he legally obligated to pay the check?

Yes, because by ordering, Jones entered into an implied contract to pay for the meal.

Jones, the seller, receives an offer to purchase and puts forth a counteroffer to Brown, the buyer. Until Brown notifies Jones of his acceptance or rejection, Jones:

may produce a new counteroffer.