chapter 10 part 1
Some items are included in important contract addendums, if applicable, rather than appearing on the contract itself. Which one of the following is a separate contract addendum that's attached to the contract, if applicable? A.Homeowners association information. B.The due diligence period. C.Settlement and closing dates. D.Details about home warranties.
A
The OPC form can be used for different types of real estate transactions, but what kind of sale was it specifically designed to document? A.Existing single-family, residential properties in North Carolina. B.New construction, single-family residential properties in North Carolina. C.Existing commercial properties in North Carolina. D.New construction commercial properties in North Carolina.
A
The OPC includes the seller's agreement and authorization to disclose certain information related to their owners' association, if applicable. Which of the following is not something that the buyer is entitled to receive and review? A.A list of names and biographical details about neighbors. B.Bylaws. C.Restrictions and limitations on association members. D.The amount of regular assessments and dues.
A
The Vacation Rental Addendum, NC Standard form 2A13-T, should be used when the property is subject to one or more existing vacation rental agreements as defined by what state law? A.The Vacation Rental Act. B.The Vacation Owners Act. C.The Rental Property Fairness Act. D.The Vacationers Rights Act.
A
Which of the following is not a reason why a sales contract is important? A.The contract must be recorded with the Register of Deeds. B.The contract includes important terms and conditions of the sale. C.The contract is intended to protect both buyers and sellers. D.Real estate transactions are generally large-dollar transactions.
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A buyer using VA financing learns that the appraised value was significantly less than expected. The buyer decides to proceed with the purchase, making up the difference in cash. Which of the following statements is true? A.The buyer must disclose the source of the cash to the DVA. B.The buyer can borrow the additional cash without notifying the DVA. C.The buyer does not have the option of making up the difference in cash. If the appraised value is too low under a VA loan, the contract is cancelled. D.If the appraised value for a VA loan is lower than expected, the seller has the option of lowering the sales price or canceling the contract.
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A buyer's agent wants to include additional information regarding one of the contract provisions as an Addendum. Which of the following is a correct statement? A.The agent may use a pre-printed addendum, or the client can retain an attorney to draft new language. B.The agent may use a pre-printed addendum or draft new language. The prohibition against agents' drafting contracts does not extend to addenda. C.Addendums may not be added to the contract. All information must be specified within the document. D.The buyer's agent should advise the buyer to simply write up a separate statement to provide to the seller. There is no need to formalize the additional information as an addendum.
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Addendums are often used with sales contracts. Which of the following is a true statement about addendums? A.Addendums are attached to, and become part of, the sales contract. B.The parties can choose whether to include any addendums or just use a basic sales contract, even if addendums would apply to the sale. C.When used, addendums are separate, free-standing legal agreements between the parties, independent of the sales contract. D.Addendums must be signed by one of the parties, either the buyer or seller, but both signatures are not required.
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At what point does the Back-Up Contract automatically terminate if the seller has not notified the buyer that the primary contract was cancelled and if the buyer has not exercised their right to terminate the agreement? A.On the date specified in item 11 of the Back-Up Contract Addendum. B.30 days after the effective date of the Back-Up Contract. C.60 days after the effective date of the Back-Up Contract. D.15 days after the effective date of the Back-Up Contract.
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At what point does the sales contract become legally binding on the parties? A.When all parties have signed it. B.When the prospective buyer submits it to the seller. C.When the seller counters the original offer. D.When the seller verbally states they are going to accept the offer.
A
Barb Buyer wants her agent to write up a quick two-page agreement, because she doesn't want to make her offer too confusing for the seller. May the agent do as the client requested? A.No. Licensees may not draft real estate contracts or forms for their clients. B.Yes. Normally, agents may not draft contracts. But, in this case, the client specifically requested it. C.Yes. Real estate licensees frequently receive this kind of request, and drafting contract provisions is part of the job. D.No. The client must use the pre-printed standard sales contract form.
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Barbara bought a beach house from Sam and closing occurred May 1. Victoria had a rental agreement with Sam scheduled to begin December 15. Which of the following is NOT a true statement about Victoria's and Barbara's rights? A.Victoria can compel Barbara to honor the existing rental, since it was made before closing. B.Barbara may choose to, but is not required to, honor the rental agreement with Victoria. C.If Barbara chooses not to honor Victoria's rental agreement, she must refund any payments already made by Victoria. D.Since Victoria's rental is more than 180 days after closing, she does not have the legal right to compel performance of the rental contract.
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Choose the best statement about the importance of the North Carolina real estate sales contract. A.Real estate sales are generally large-dollar transactions, with both the seller and potential buyer taking significant risks. The sales contract is intended to protect both parties by documenting the terms and conditions of the sale. B.Buyers bear the most risk in real estate transactions. The sales contract is intended primarily to protect buyers by documenting the terms and conditions of the sale. C.Sellers bear the most risk in real estate transactions. The sales contract is intended primarily to protect sellers by documenting the terms and conditions of the sale. D.Buyers, sellers, and real estate licensees all bear risk in real estate transactions. The sales contract is intended primarily to protect real estate licensees by documenting the terms and conditions of the sale.
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Does the buyer under a Back-Up Contract have the right to examine the primary contract? A.No, the buyer may not review or examine the primary contract unless the seller and primary buyer agree. B.Yes, the buyer has an automatic and unlimited right to review and examine the primary contract. C.Yes, the buyer has the right to review and examine the primary contract, exercisable within five days of the Back-Up Contract's effective date. D.The buyer has a limited right to examine the primary contract, but only if they agree to allow the primary buyer to also examine the Back-Up Contract.
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How are "days" calculated under the OPC? A.Days means consecutive calendar days, including weekends and holidays. B.Days means consecutive weekdays, but not weekends or holidays. C.Days means consecutive calendar days, including weekends but not holidays. D.Days means consecutive calendar days, including holidays, but not weekends.
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How are costs like real estate taxes, personal property taxes, rents, and owners' association dues handled in the OPC? A.Unless agreed upon is some other manner by the parties, these expenses are prorated, and the seller is responsible for paying them until closing. B.These expenses are not addressed in the OPC. C.The seller is always solely responsible for these costs and must pay in full all bills prior to closing. D.From the effective date of the contract, the buyer is always responsible for these costs.
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How should the due diligence period be identified in the Back-Up Contract? A.By using a number of days, with the time period starting on the day after the seller notifies the buyer that the primary contract was cancelled. B.By using a specific date. C.There is no additional due diligence period under a Back-Up Contract because the buyer can conduct due diligence while the contract is still in the secondary position. D.The due diligence period under the Back-Up Contract is automatically 15 days.
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When does the due diligence period start? A.On the contract effective date. B.When the buyer submits the offer. C.One day after the parties have signed the agreement. D.On the date that the buyer's check for the due diligence fee clears.
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How will legal expenses be handled if one party brings suit against the other for breach of this agreement? A.The losing party will pay the costs and expenses associated with litigation, including the prevailing party's attorney fees. B.The prevailing party will pay the costs and expenses associated with litigation, including the losing party's attorney fees. C.The parties agree that each of them will be responsible for paying their own costs and expenses associated with litigation. D.This agreement does not address how legal expenses will be handled in the event of a breach of contract.
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If a residential dwelling was designed in 1977 and erected in 1979, would the Lead-Based Paint Addendum be necessary for the contract? A.No, the addendum is only required if the dwelling was constructed before 1978. B.No, the addendum is required only for buildings which have been proven to have a higher risk of lead poisoning. C.Yes. As the building was designed while lead-based paint was permitted, the risk of lead poisoning is still present. D.Yes, as this addendum is required in all real estate contracts, regardless of the property's construction date.
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If the agreement is terminated after the Commencement Date, all of the following are true EXCEPT: A.The seller must pay one-half of the buyer's relocation expenses. B.The buyer must immediately vacate the property. C.If the buyer does not vacate, they remain subject to the terms and conditions of the agreement. D.The buyer must pay the seller a daily hold-over fee for each day the buyer remains on the property.
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If the buyer decides to cancel the contract based on the inspection reports, what happens to the due diligence fee? A.The seller keeps the due diligence fee. B.The buyer is entitled to a return of the fee if they cancel the contract during the due diligence period. C.The fee does not go to either the buyer or the seller. Instead, the fee is used to pay for inspections and other due diligence activities. D.In this scenario, the parties must agree, in a contract addendum, as to who is entitled to the due diligence fee.
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If the parties don't specify otherwise, what is the default settlement date for this Addendum? A.The 30th day following the seller's notification to the buyer of the approval of the short sale. B.The 20th day following the seller's notification to the buyer of the approval of the short sale. C.There is no default settlement date in this Addendum; the parties must specify the settlement date. D.The 10th day following the seller's notification to the buyer of the approval of the short sale.
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If the property includes one or more manufactured homes, the home(s) should be identified in Item 5 of the Additional Provisions Addendum. Which of the following are acceptable ways to identify each mobile home? A.VIN number or, if unknown, a description including the year and model. B.VIN number is the only acceptable identifier. C.Photographs of the interior and exterior of each home. D.The Property ID numbers for each mobile home, as recorded with the Register of Deeds.
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If the seller intends to include personal property with the sale, such as curtains, fireplace tools, or freestanding appliances, whom does the OPC state the buyer should consult with before signing the form? A.If applicable, the buyer should consult with their lender to make sure such personal property can be included with the purchase. B.The buyer should consult with their accountant to determine if the personal property will change the property valuation. C.The buyer should consult with their attorney to evaluate the legal ramifications of purchasing such personal property. D.The buyer should consult with their real estate licensee to discuss the inclusion of the personal property.
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If the seller tells the buyer under the Back-Up Contract that the primary contract was cancelled when it actually wasn't, and the buyer incurs expenses as a result, who is liable? A.The seller. B.The primary buyer. C.The buyer under the Back-Up Contract. D.Responsibility depends on the facts and circumstances. All parties involved may share some financial and legal liability.
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If this contract is used for subdivided property, what must have already occurred before the contract is signed? A.The property must be platted, approved, and recorded with the Register of Deeds. B.The property must be unplatted, approved, and recorded with the Register of Deeds. C.The property must be platted and approved, but no requirement exists for it to be recorded with the Register of Deeds. D.The property must be unplatted and recorded with the Register of Deeds.
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Is it normal to use a verbal agreement to sell real estate in North Carolina? A.No, agreements must be in writing, must include specific information, and must be signed by all parties. B.Yes. Verbal agreements for the sale of real estate can be enforced if one party breaches the agreement. C.Yes, as long as the verbal agreement is made in the presence of a licensed real estate attorney. D.No. Real estate agreements must be made using the standard North Carolina sales contract form.
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Liza Licensee is helping Sam Seller review offers. Sam wants to accept an offer with a slight modification to the proposed terms. Which of the following is true? A.Sam must create a counteroffer with his proposed changes to the original offer. B.Sam can write in his changes and initial them before signing to accept the offer. C.If the buyer's agent indicated that the buyer is open to changes, Sam can sign the offer as written, and the parties can verbally agree to change the terms. D.If Sam creates and signs a counteroffer with the new terms, the parties automatically have a binding agreement.
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May North Carolina real estate licensees draft contracts for their clients? A.No. State statutes and Real Estate Commission rules specifically prohibit licensees from drafting contracts or agreements for clients. B.Yes. State statutes prohibit providing real estate-related legal services, but drafting a contract is not considered legal advice. C.Yes, as long as they also recommend that the client have a licensed attorney review the document. D.No, unless the client signs a separate agreement and pays the real estate licensee to draft the contract.
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North Carolina statutes and Real Estate Commission rules prohibit licensees from providing legal advice or services. Which of the following could a licensee do without breaking the rules? A.Help a client select and complete pre-printed forms. B.Preparing a real estate deed. C.Drafting a sales contract to fit a client's needs. D.Advising a client as to the potential legal ramifications of a proposed contract provision.
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The seller is obligated to provide certain notifications and information under the Lead-Based Paint Addendum. Which of these is not a notification requirement? A.When the last coat of paint was applied on the property. B.Acknowledging that lead-based paint or lead-based paint hazards exist on the property. C.The possible lack of knowledge of any lead-based paint hazards on the property. D.Any and all available reports and records about any potential lead-based paint hazards.
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The seller may agree to make repairs or improvements prior to the settlement date, in Item 4 of the Additional Provisions Addendum. Which of the following is NOT a true statement: A.The seller is responsible for making agreed-upon repairs, but the buyer and seller agree to be jointly responsible for paying the costs of such repairs. B.The seller agrees to make repairs at the seller's expense, unless otherwise agreed. C.The buyer retains the right to verify repairs and improvements were completed in a "good and workmanlike" manner. D.The seller is ultimately responsible for making the agreed-upon repairs, and failure to do so means the seller is in breach of contract.
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There are four possible ways to evidence termination of the primary sales contract. Which of these is NOT one of those ways? A.The buyer in the secondary position can notify the primary buyer in writing that the original contract is terminated. B.The primary buyer and seller can sign a written release terminating the primary contract. C.The seller can notify the primary buyer in writing that the seller is exercising a contractual right to terminate their agreement. D.The primary buyer can give the seller a written notice that the buyer is exercising a contractual right to terminate their agreement.
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Under which of these circumstances would the buyer NOT be entitled to a return of their earnest money? A.The buyer breaches the contract. B.The seller breaches the contract. C.The buyer cancels the contract within the due diligence period. D.The seller does not accept the contract.
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What does the "Contingency" clause in the Short Sale Addendum state? A.The sale is contingent on obtaining written approval from all the lienholders. B.The sale is contingent on the sale of the buyer's existing home. C.The sale is contingent on the buyer obtaining mortgage approval. D.The sale is contingent on the approval of the parties to any existing vacation rental contracts for the property.
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What does the OPC state will happen if a dispute arises about the earnest money while it's in escrow? A.The escrow agent may not release the funds until they receive a release signed by all the parties or until they receive a court order to disburse the funds. B.The escrow agent disburses the earnest money: one-half to the seller and one-half to the buyer. C.On the condition that the seller must pay back the buyer if it's later determined that the buyer was entitled to the funds, the escrow agent delivers the funds to the seller. D.On the condition that the buyer must pay back the seller if it's later determined that the seller was entitled to the funds, the escrow agent delivers the funds to the buyer.
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What happens if a buyer is in breach of their responsibilities under a sales contract using the Buyer Possession Before Closing Addendum? A.The seller may evict the buyer using the North Carolina Summary Ejectment Proceeding. B.The seller must abide by state and federal foreclosure laws, giving the buyer the opportunity to make up missed payments. C.The buyer may have a claim to remain in the home under the theory of Adverse Possession. D.The seller may evict the buyer using the federal Eviction of Buyers Before Closing proceeding.
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What happens if the buyer's earnest money check isn't honored or the buyer doesn't pay the earnest money as agreed upon in some other way? A.The buyer has one business day to deliver the funds via cash, official check, electronic transfer, or wire transfer. B.The buyer has three business days to deliver the funds via cash, official check, electronic transfer, or wire transfer. C.The contract is automatically cancelled. D.The buyer must make payment within one business day, and he or she must pay an additional penalty to the seller.
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What happens if there is a conflict between the terms of the Additional Provisions Addendum and the OPC, related to one of the specific provisions numbers 1-5? A.The Addendum controls. B.The OPC controls. C.This type of conflict is not contemplated on the Addendum, so the parties must litigate their dispute. D.The parties agree in this Addendum that the conflict will be resolved in favor of the buyer.
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What is one thing the buyer and seller can do to protect themselves against becoming victims of wire fraud in a real estate transaction? A.Before wiring money, contact the closing attorney's office at a number obtained independently to verify the legitimacy of the arrangement. B.Contact the closing attorney before wiring money, using the contact information provided by the other party to verify the legitimacy of the transaction. C.Wire fraud is not a concern in real estate transactions, so the parties have nothing special to do. D.Wire the funds as requested and then contact the closing attorney's office to verify the wire was received.
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What is the main reason a licensee should think twice before drafting real estate contract provisions for a client? A.State statutes and commission rules prohibit licensees from drafting contract language. B.It can be difficult to get the wording just right, and it may take considerably more time than the licensee planned. C.The sale is not guaranteed to go through, so the licensee may never be compensated for their time and effort in writing contract provisions. D.If the licensee makes a mistake, the client could be upset and might tell their friends not to work with the licensee.
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What is the term used in the OPC to describe government charges against the property in addition to "regular" real estate taxes and fees or charges levied by a homeowners' association in addition to regular dues? A.Special assessments. B.Due diligence fees. C.Closing costs. D.Escrow Fees
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When are due diligence fees payable under the Back-Up Contract Addendum? A.Within 2 days of the seller notifying the buyer that the Primary Contract was cancelled. B.As soon as the Addendum is signed by all parties. C.Within 5 days of the Addendum being signed by all parties. D.Within 5 days of the seller notifying the buyer that the Primary Contract was cancelled.
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When authorized or directed by a client to do so, which of the following may a real estate licensee draft for a client? A.Pre-printed sale or lease contract forms. B.Deeds of trust. C.Real estate deeds. D.Promissory notes.
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When might a buyer be exempt from some of the requirements under the Vacation Rental Act? A.If the buyer hires the same rental broker who arranged for the existing rentals for the seller. B.If the buyer hires a broker the seller said he was considering hiring at the time of closing. C.If the buyer didn't understand the property was subject to the Vacation Rental Act. D.If the buyer and seller verbally agree that the seller will assume responsibility for these requirements.
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When the Short Sale Addendum is used, how does the Due Diligence period work? A.The period begins when the buyer receives notification that the short sale has been approved, and it continues for the number of days specified in the Addendum. B.The period begins when the contract is executed, and it continues for the number of days specified in the OPC. C.There is no Due Diligence period when using the Short Sale Addendum. D.The period begins when approval has been requested from the lienholder(s), and it continues for the number of days specified in the Addendum.
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When the Short Sale Addendum is used, which of these is NOT a true statement regarding other offers and additional contracts? A.The sales contract covered by this Addendum becomes null and void if the seller closes on another sales contract. In that case, nobody is entitled to a return of the earnest money. B.After the agent submits a request for a short sale to the lienholder, the seller's agent must inform the lienholders of all the offers and contracts received. C.If a seller accepts additional offers, they may substitute an additional contract for short sale approval with the lienholder up until the point the lienholder approves the original submission. D.Unless and until the parties terminate this contract, the seller is obligated to notify the buyer in writing if the seller accepts any additional contracts, substitutes an existing or additional contract for this one, closes on an existing or additional sales contract, or receives short sale approval for another sales contract.
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When would you use the FHA/VA Financing Addendum? A.when a buyer intends to obtain mortgage loan financing from the U.S. Department of Housing and Urban Development's Federal Housing Administration or from the Veteran's Administration B.when a buyer intends to have the seller finance their mortgage C.when a buyer is paying cash for the sale and will not be obtaining financing through the FHA or VA D.when a buyer intends to obtain mortgage loan financing from the NC Financial Help Administration or from the Veteran's Administration
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Which additional addendum is required for property built before 1978? A.The Lead-Based Paint Disclosure Addendum. B.The Manufactured / Mobile Home Addendum. C.The Additional Provisions Addendum. D.The Mineral and Oil and Gas Rights Mandatory Disclosure Statement.
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Which is a true statement regarding a transaction involving rental property or property otherwise held for investment purposes? A.The property will be conveyed subject to existing leases, preserving the rights of existing tenants. B.The new buyer has the option of maintaining current leases, but is not obligated to do so. C.The buyer may request copies of leases, rental agreements, tenant notices, deposits, and other relevant documentation from the seller. However, the seller is not obligated to provide this information. D.The seller must provide the buyer with relevant documentation regarding current leases within three business days of the contract's effective date.
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Which of the following best describes the Buyer Possession Before Closing Agreement? A.An addendum to the OPC designed to address short-term occupancy by the buyer. B.A standalone legal contract designed to address short-term occupancy by the buyer. C.An addendum to the OPC designed to address long-term occupancy by the buyer. D.A standalone legal contract designed to address long-term occupancy by the buyer.
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Which of the following expenses is not the buyer's responsibility after the Commencement Date? A.Fire and hazard insurance on the property. B.Utilities. C.Lawn care. D.Trash removal.
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Which of the following is NOT a risk associated with using an incorrect real estate contract form? A.The property description might be incorrect or inaccurate. B.Important disclosures required by law may not be provided if an incorrect form is used. C.An incorrect form could include extra information that doesn't apply to the parties' situation. D.An incorrect form could exclude certain sections and omit material information that the parties need to know.
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Which of the following is NOT a true statement regarding Item 1 of the Additional Provisions Addendum, used to document the date and time the offer will expire? A.By default, the expiration date is 10 business days from the date of the written offer. B.The seller can unconditionally accept the offer prior to this date. C.The buyer can withdraw an unaccepted offer prior to this date. D.There are checkboxes to include whether the expiration time is AM or PM.
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Which of the following is NOT true regarding the Additional Provisions Addendum? A.The Addendum includes sections for Short Sales and Vacation Rental Property. B.The Addendum attaches to, and becomes part of, the OPC. C.All parties should initial page one and sign page two of the Addendum. D.The form includes a disclaimer advising the parties to seek legal counsel before signing the Addendum.
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Which of the following is NOT true regarding the buyer's obligations to tenants with existing rental agreements? A.The buyer is obligated to honor existing vacation rental agreements that extend beyond 180 days from closing. B.The buyer takes title subject to existing rental agreements scheduled within the first 180 days after closing. C.The buyer may honor agreements that extend beyond 180 days from closing but is not required to do so. D.The buyer must notify each tenant with an existing vacation rental agreement of the property transfer within 20 days after closing.
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Which of the following is a true statement? A.Neither the North Carolina Association of Realtors nor the North Carolina Bar Association makes any representation as to the legal validity of the OPC. B.The North Carolina Association of Realtors and the North Carolina Bar Association both approve of and represent the legal validity of the OPC. C.The North Carolina Association of Realtors, not the North Carolina Bar Association, represents the legal validity of the OPC. D.The North Carolina Bar Association, not the North Carolina Association of Realtors, represents the legal validity of the OPC.
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Which of the following is an acceptable way to identify the sellers, John and Ann Smith? A.John A. Smith and Ann C. Smith. B.Mr. and Mrs. Smith. C.J.A. and A.C. Smith. D.The Smiths.
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Which of the following is not a true statement about the "Settlement" date in the OPC? A.The settlement date and closing date are always the same date. B.Settlement refers to the date the settlement statements should be received by the closing attorney. C.The settlement date is when the closing attorney should receive all the financing documents and the funds to complete the transaction. D.The settlement date may be before the closing sate.
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Which of the following is not a true statement about the North Carolina Realtors' pre-printed forms library? A.The library includes forms for standard sales contracts, but it doesn't include forms for additional contract-related matters. B.North Carolina Realtors Association members have access to the forms library as part of their membership. C.The library includes forms for residential and commercial contracts. D.The library includes forms that can be used for property management.
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Which of the following is not a typical source for licensees to find pre-printed real estate contracts and forms? A.The North Carolina Real Estate Commission's website. B.The licensee's real estate brokerage. C.North Carolina Realtors Association forms library. D.Online forms providers.
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Which of the following is not listed as a risk of lead poisoning for children in the italicized warning statement? A.An increased risk of cancer. B.Permanent neurological damage. C.Impaired memory. D.A potential to develop learning disabilities.
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Which of the following provisions, if included in a Sales Contract, would violate NC Real Estate Commission Rules? A.Provision stating that earnest money will be forfeited to the listing and selling broker if the agreement is cancelled. B.Information about assessments. C.The amount of earnest money paid. D.How the buyer will make payment for the purchase.
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Which of the following should not be relied upon as a source of assistance in understanding a provision or section of the North Carolina Offer to Purchase and Contract Form? A.A certified paralegal working in a real estate office. B.Form 2G, "Guidelines for Completing the Offer to Purchase and Contract." C.A licensed real estate attorney. D.More senior real estate professionals in your office.
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Which of the following statements regarding the North Carolina Back-Up Contract Addendum is false? A.This form is used for the primary contract (first accepted offer), when the seller wants to consider a secondary offer in case the primary offer falls through. B.This addendum applies to the second contract, when the buyer has already accepted another offer on their property. This contract is in the secondary position, behind the primary contract. C.This form should not be used for short sales. D.When signed, this addendum attaches to and becomes part of the OPC for the secondary contract.
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Which of these is NOT a true statement regarding inspections and due diligence when a contract includes the Lead-Based Paint Addendum? A.Buyers automatically waive their right to conduct independent inspections when signing the Lead-Based Paint Addendum. B.Buyers have the opportunity to conduct risk assessments or investigations related to lead-based paint. C.Buyers have the option of waiving their right to conduct inspections or assessments. D.Buyers are strongly encouraged to conduct investigations and assessments.
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Which of these is NOT a true statement regarding the buyer's rights to cancel the Back-Up Contract? A.If the buyer terminates the contract after it becomes the primary contract and after the expiration of the due diligence period, they are only entitled to receive a refund of one-half of their earnest money. B.The buyer can terminate without liability by giving the seller written notice at any point up until the Back-Up Contract becomes the primary contract. C.After the Back-Up Contract becomes the primary contract, the buyer can still terminate without penalty as long as they do so during the due diligence period. D.If the buyer terminates the agreement while it is still in a secondary position, or while it is the primary contract but within the due diligence period, the buyer is entitled to a return of their earnest money.
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Which of these is a true statement about the FHA/VA Financing Addendum? A.The sections of the form to be completed depend on which financing option the buyer is pursuing. B.All sections of the form must be completed for it to be valid. C.This form is attached to every sales contract in NC regardless of whether the buyer is pursuing FHA or VA financing. D.This form is a separate contract and not part of the OPC.
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Which of these is a true statement about the buyer's due diligence rights? A.During the due diligence period, buyers may conduct investigations at their own expense. If a buyer decides to cancel the contract during this period, they may do so. Their earnest money will be returned to them. B.If a buyer decides to cancel the contract during the due diligence period, they split the earnest money with the seller. C.If due diligence investigations reveal the need for repairs, the seller is obligated to make them. D.If a buyer's loan application is denied after the expiration of the due diligence period, the buyer can still cancel the agreement without penalty.
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Which of these is not a potential benefit for a seller who enters into a seller possession after closing agreement? A.They don't have to pay the buyer rent until the end of the agreement term. B.They have interim housing and only have to move once. C.They will have the proceeds from the sale at closing, making them a stronger buyer for their next home. D.Their housing costs for the short term (the term of the agreement) are fixed and known up front.
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Who is responsible for maintenance and repairs during the term of a seller possession after closing agreement? A.the seller B.the buyer C.The parties negotiate responsibility on a case-by-case basis. D.The seller and buyer are each responsible for one-half of the costs.
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Who typically signs the sales contract first? A.The offeror (buyer) signs the contract first, listing the terms of their offer, before submitting it to the seller for review. B.The seller signs the sales contract first, specifying the terms they want potential buyers to accept. C.The buyer and seller typically sign the sales contract together at closing. D.The buyer's and seller's agents usually sign the sales contract before their clients sign.
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Why is it important for North Carolina real estate professionals to have a working knowledge of the standard sales contract form? A.So they can help clients understand and fill in pre-printed forms. B.So they can draft new contract language for clients when existing language doesn't meet the client's needs. C.To provide legal advice to clients who have questions about a contract's provision. D.Real estate professionals should recognize the form, but they don't need a working knowledge of it.
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hen would the addendum 2A9-T be used in a real estate transaction? A.When the real estate in question contains a residential dwelling constructed prior to 1978. B.When the buyer wishes to have the property inspected to ensure that it complies with all health codes. C.When the real estate in question contains a residential dwelling constructed prior to 1981. D.The form is used to disclose any structural damage to the property.
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