Chapter 5 - Real Estate Exam Review

Before signing the Addendum for Coastal Area Property, which of the following should buyers take into consideration?

Property boundary changes due to moving tide lines.

What was the name of the first licensing act in Texas?

Real Estate Dealers License Act

How many members does TREC appoint to the Broker Lawyer Committee?

Six

Damon's home gradually became located on a public beach due to erosion. What happens now?

The state can sue Damon and make him remove the home at his expense

What is an advantage to using mediation as a problem-solving tool in a contract dispute?

It offers a win win solution because both parties come out with satisfactory results.

When a contract is executed, the timing for certain contract requirements begins ________ day(s)

One

Your client is selling a condominium. Which of the following forms is your client required to provide to the buyer?

condominium resale certificate

If the sellers don't reserve all of their interest in the mineral estate, the sellers have _______ days after the effective date of the contract to provide the buyer with the contact information of any existing mineral lessee known to the seller.

seven

Sheila, a buyer didn't receive seller's disclosure notices until she went in to sign her closing paperwork. If Sheila terminates now, __________.

she will receive her earnest money back.

An escrow agent is not liable for the bank's loss of earnest money, unless ________.

the bank is the acting escrow agent

Per the Addendum for Sale of Other Property by Buyer, what happens if the contingency is not waived or met by the date specified in the addendum?

the contract is automatically terminated, and the earnest money is refunded to the buyer.

What is a representation, according to the TREC sales contract in Texas?

the statement s included throughout the sales contract

what options does the TREC-promulgated Addendum for the Release of Liability on Assumed Loan and/or Restoration of Seller's VA Entitlement give the Texas seller if the restoration of VA entitlement is not approved by closing?

to terminate the contract or not delay the closing

Regarding the need for consent for a contract to be valid, which of the following exists when an act of persuasion overcomes another person's free will and judgement?

undue influence

In the Property Condition paragraph of the TREC One To Four Family Residential Contract (Resale), the seller agrees that the buyer may have the property __________.

Inspected by inspectors selected by the buyer

Susie a Texas broker, has received written consent from two parties she is representing. She represents both the buyer and the seller as their broker for a current transaction, which means that she is acting as a __________.

Intermediary

Your buyer clients Melvin and Harry want to make an offer on a ranch. Which type of property description will you need to use on the Farm and Ranch Contract?

Metes and Bounds

Which of the following requires that a legal description of the property be included in a real estate contract in Texas?

Statute of Frauds

Which party to the contract will provide the sales price and financing to be used in the transaction?

buyer

All third party financing in texas is subject to property approval and may or may not be subject to

buyer approval

The seller is responsible for which of the following expenses?

liens

If a casualty loss occurs on a property subject to a real estate transaction, who or what entity is responsible for bringing the property back to its original condition?

the seller, through the seller's insurance

Jan is selling her home but she wants to keep the new refrigerator and the above ground pool. In order to do this, where should they be listed on the One to Four Family Residential Contract (Resale)?

Exclusions

What does it mean that Peter Hubble is identified as a party to a sales contract as "Peter Hubble, as a separate party?"

Peter is married, but his spouse is not joining in the conveyance of the property

On which entity's website can you reference to find promulgated contract forms?

TREC

Your buyer client, Millicent, is closing on a property on January 3, but she has a February 15 date of possession. Which of the following is likely true about this situation?

The seller is paying rent.

The Texas Loan Assumption Addendum states, "If the ________ of all assumed loans varies in an amount greater than $500 at closing, either party may terminate this contract and the earnest money will be refunded to a buyer unless the other party elects to pay the excess of variance."

Total principle balance

How many days does the Texas seller have to deliver a commitment for title insurance to the buyer under the terms of the TREC one to four family residential contract?

20

How long is a member of TREC's term?

six years

A situation in which the parties involved in a contract dispute present their argument to an unbiased third party, who then makes a final decision is called _______________.

Arbitration

Which of the following is a true statement about residential service contract in Texas?

It's typically for one year of coverage

What type of forms are the Condominium Resale Certificate and the Subdivision Information, including Resale Certificate for Property Subject to Membership in a Property Owners Association?

Promulgated Resale Certificate

In what paragraph of the TREC One to Four Family Residential Contract (resale) in Texas does the seller agree to permit the buyer and the buyer's agent access to the property at reasonable times?

Property Condition

Ahmad and Mahasin recently put in an offer on a home. The seller tells his agent to reject the offer. What should the seller's agent do?

Provide written notice to Ahmad and Mahasin

Alex and Olivia Benson are buying a home using an FHA loan. What type of financing addendum will they need to check in the Sales Price section of the TREC One to Four Family Residential Contract (resale)?

Third Party Financing Addendum

As part of the sales contract, Garth, the seller, was supposed to provide a copy of the seller's disclosure to the buyer, Melanie but he failed to do so. What type of contract is this?

Voidable

If a buyer requests subdivision information using the addendum for property subject to mandatory membership in a property owners association form, who pays to obtain the information and have it delivered?

it depends

Janet and Hank are buying a condominium from Shirley. Who's responsible for the transfer fees charged by the association up to the amount specified in the contract?

Janet and Hank

Which of the following states that the person who committed the fraud, as well as anyone who knew about the fraud, failed to disclose it, and benefited from it, can be held liable for actual damages?

Fraud in Real Estate and Stock Transactions

The parties were scheduled to close January 15, but now wish to close January 10. What Texas form must be completed and signed?

No form is needed, as long as the parties agree and have met all their contractual obligations

Of the nine total members of TREC, how many members are licensed brokers?

Six

For purposes of performance, what is the effective date of the "Back Up" contract based upon?

The date the buyer received notice of the termination of the first contract

What happens if the seller is unable to furnish the buyer with the commitment and exception documents within 20 days after the title company has received a signed copy of the TREC One to Four Family Residential Contract (resale)?

The deadline for delivery is automatically extended

The ranch that Adam and Maria are interested in buying has a cotton crop already planted on it. Which of the following is a true statement?

The seller needs their permission to harvest the crop after closing.

In Texas, which of the following real estate contracts does not have to be in writing to be enforceable?

a lease that is for one year or less

When Jan sells her house, she'll leave behind the draperies shades, window air conditioner, and garage door opener, which are considered

accessories

Per the TREC one to four family residential contract (resale), which of the following statements about lender required repairs is true?

neither party is obligated to pay for lender required repairs.