promulgated contracts final exam qs NON MC
Brittany is set to close on her new home in three days, but today she received a phone call from her agent stating that the lender needs to push closing back 7 days. What, if any, action needs to be done?
Brittany's agent should submit an "Amendment to Contract" (TREC 39-7) with the new closing date to the seller's agent.
On the TREC promulgated "New Home Contract - Incomplete Construction" (23-12), how is the commission paid to the broker to be handled?
By a separate written agreement.
What is it called when all terms in a contract are agreed to by all the parties of the contract?
Mutual Assent
If a party feels he has been wronged, what law sets the deadline for initiating legal proceedings?
Statute of Limitations
What should a buyer do if he wants to submit an offer on a home that already has a contract on it?
Submit an offer with TREC 11-7 Addendum for Back-up Contract attached.
Seller Brittany has agreed to a contract term that allows the buyer to purchase her property within two months at an agreed upon price. Which contract feature has Brittany agreed to?
An option
What group has the task to draft and revise contracts and forms for use by licensees?
Broker-Lawyer Committee
What agreement is typically made when a buyer moves in before the actual close?
Buyer's Temporary Lease
What is added to Form 25-9 "Farm and Ranch Contract" in paragraph 3 that does not appear on Form 20-11 "Residential Contract"?
Cash portion of Sales Price
What paragraph of Form 24-12 "New Home Contract Completed Construction" deals with property damage?
Casualty loss
What term describes the status of a sales contract from the time of the contract's signing to the day of closing?
Executory
What action by an owner may be a violation of federal wetland laws?
Filling in areas with topsoil
Form 9-10 "Unimproved Property Contract" differs from Form 20-11 "Residential Contract" in that:
Form 9-10 calls for possession on the date of closing.
At what point does an offer become a contract?
After the seller's acceptance is communicated back to the buyer
What are the four basic elements of a bilateral contract?
Mutual assent, Competent parties, Consideration and Legal objective
If a home is being leased back to the seller under TREC 16-5 "Buyer's Temporary Residential Lease", when does the lease commence?
No more than 90 days prior to closing, depending upon the agreement
All of the following actions would be considered practicing law without a license except which one?
Tell the client known facts about the property that might affect the title.
What is the best solution if a situation arises and both the seller and buyer agree to alter a binding, signed Residential Contract?
The "Amendment to Contract" (TREC 39-7) must be completed and signed by both parties.
On Form 24-12 "New Home Contract Completed Construction", what two amounts equal the sales price?
The cash the buyer is putting up plus the sum of all of the financing
Which of the following transactions would use Form 9-10, Unimproved Property Contract?
The sale of a spec home
What does the use of the TREC OP-H "Seller's Disclosure of Property Condition" form facilitate?
The seller meeting regulations concerning the disclosure of the condition of the property
What can be done if a seller needs extra time and wants to remain in the home past the closing date?
The seller should ask the buyer for permission and both should sign a temporary lease.
What happens to the penalty funds collected from transfer fee violators?
They are placed in the general revenue fund of the State.
On the TREC promulgated "Unimproved Property Contract", in what paragraph would you find information regarding potential annexation?
Title Policy and Survey
Which of the following statements best defines "promulgate"?
To officially publish rules
Novation occurs when:
a current contract is substituted with a new contract.
According to the Texas Real Estate Commission (TREC) a listing contract must contain:
a notice that it was prepared by an attorney licensed in the state of Texas.
What addendum should a licensee use if a buyer needs to sell his home before closing on a second home?
TREC 10-6 Addendum for Sale of Other Property by Buyer
A buyer leases a property for a period of time and then exercises an option to buy. Which of the following best describes TREC's position regarding the licensee's role in the option contract?
TREC discourages licensees from getting involved in the negotiations.
Which of the following TREC promulgated forms addresses a "contract for deed"?
TREC has no promulgated form for this type of transaction.
Due to _________________ property purchased along the coastline can change.
erosion
To write a legal description for a large ranch, the licensee would:
probably have to attach an addendum to completely describe the property.
Who normally pays for environmental assessments?
The buyer
If a loan is assumed by a buyer, what happens to any escrow accounts associated with the property?
The escrow accounts will be transferred to the buyer assuming the loan.
In completing a sales contract, the sale price should equal:
the down payment added to any loans.
A broker could receive a fee from a Residential Service Company (RSC) for recommending:
the size and brand of the hot water heater.
One reason that a survey may not be required in a conventional transaction is because:
they are very expensive.
Loan origination charges:
vary from lender to lender.
What is the effective date of the contract?
Upon the seller's acceptance and communication of that acceptance to the buyer. *DETAILED ANSWER: The last party to accept the terms has communicated acceptance to the other party or his agent. The effective date becomes the date the last party communicated acceptance to the other party or agent.
Which of the following is the worst action for a licensee in regards to mineral rights?
Writing the terms of the agreement into the special provisions section of the TREC Residential Contract.
Under TRELA, a licensee will not be in violation of practicing law without a license if she:
fills in the blanks on a standardized contract.
A seller can have another party assume her loan if:
the lender allows it.
TREC 12-3 "Addendum for Release of Liability on Assumption" is used when a buyer wishes to assume a loan and:
the seller wants to be released from any further liability.
According to the TREC OP-L "Addendum for Seller's Disclosure of Information on Lead-Based Paint", how many days from the effective date of the contract does the buyer have to get the property inspected?
10 days
If a home is built prior to what year does it trigger the mandatory disclosure on lead based paint?
1978
What is the purpose of the TREC OP-K "Information About Brokerage Services" form?
Informing the buyer and seller as to the function of the licensee in terms of agency.
Which of the following is the best definition of an executory contract?
It is a contract in which the possession date and ownership transfer date are significantly different.
What is not an option on the TREC OP-K "Information About Brokerage Services" form?
Non-agency
Who signs TREC 38-4 "Notice of Buyer's Termination of Contract"?
Only the buyer
Which of the following contract terms is designed to create an action?
Performance
In what paragraph of Form 30-10 "Residential Condominium Contract" would you find items dealing with improvements?
Property and Condominium Documents
What paragraph of Form 30-10 "Residential Condominium Contract" deals with requiring the buyer to pay for any deposits mandated by the Association?
Settlement and Other Expenses
For a short sale to go through, who must give approval?
The lender holding the current mortgage
How can a licensee determine the terms of the buyer's loan when completing FORM 40-5 "Third Party Financing Addendum for Credit Approval"?
The lender will provide this information after negotiations with the buyer.
According to TREC Residential Contract, who is to advise the buyer to have an attorney examine the abstract or obtain a title policy?
The licensee
Who is responsible for making sure all applicable addenda have been included with a sales contract?
The licensee
What should the licensee do with the TREC OP-C "Notice to Prospective Buyer" form?
Give a copy to the buyer and retain the original in file.
What is the name of the 1,300 mile canal that runs from Brownsville, Texas to St. Mark's, Florida?
Gulf Intracoastal Waterway
Who should sign the TREC OP-I - Texas Real Estate Consumer Notice Concerning Hazards or Deficiencies form?
Neither the buyer nor seller
What is the probably best action a seller can take if he or she wants to take a fixture prior to closing?
Remove the item prior to any showings.
When a transfer fee is enforced, who receives the payment?
The original creator of the covenant
In which of the following situations would a temporary lease be inappropriate?
When the seller needs the weekend after closing to finish moving.
When should the TREC OP-M "Non-Realty Items Addendum" be used?
When the seller wants to retain certain items that are attached to the real property.
Which of the following transactions require a TREC OP-H - Seller's Disclosure of Property Condition, to be provided?
When the transfer is from a professional investor in real estate.
In a short sale, if the buyer is notified of the bank's approval before the date written paragraph (D) on TREC 45-1 "Short Sale Addendum", the effective date of the contract:
is amended to the date of notification.
All oil, gas, and other minerals in or under a property, including any royalties, production and drilling rights, lease payments and all related benefits are known as a seller's:
mineral estate.
TREC 37-4 Subdivision Information is used to:
request information from the HOA to give to the buyer.
A Residential Service Company:
sells warranties to owners, covering any repairs on listed items in the home for a pre-determined length of time.
Consideration is also known as:
something in exchange for something else.
TREC No. 10-6 "Addendum for Sale of Other Buyer Property by Buyer" is used when the mortgage lender requires:
the buyer must sell his current home before closing on his contract.