Section 11-15
What's so something you should definitely do when conducting a buyer presentation?
Explain the transaction process
Which of the following is a contract that exists based on an understanding of assumption, rather than on specifically defined terms?
Implied
What is the very first step that a licensee shop ikr so when beginning a buyer presentation?
Discuss any agency disclosure information
Esther is thinking of signing an exclusive right-to-sell agreement with broker Sully, but first she asks, "What kinds of things does this agreement cover?" How should Sully answer?
"It includes a description of the property you're selling and my obligations to you, such as my duty to assist in negotiations."
In which of the following situation does a new tenant take the place of a departing tenant?
Assignment
What is it called when all parties sign a contract, but before the seller's acceptance is delivered to the buyer?
Acceptance
What is it called when all parties sign a contract, but the seller's acceptance is delivered to the buyer?
Acceptance
Your buyer, Billy, wants to make an offer on the craftsman house he saw today, but he wants the sellers to start the paperwork for a tax reassessment before closing. This isn't part of the standard sales contract in your area. What will you use to accomplish this request?
Addendum
All of the following are true regarding implied agreements EXCEPT which one?
An implied agreement is based on a formal agreement.
Which of the following statements about buyer representation is true?
An open agency relationship gives the buyer flexibility, but limits the amount of representation received from any one professional.
Lorenzo just received a prestigious fellowship to study abroad for a year! However, he'd just signed a one-year lease on his apartment. With the landlord's permission, he substituted his sister's name on the lease, and Lorenzo's sister will pay rent directly to the landlord. Lorenzo may still be liable for the rent if she misses any payments. This is an example of ______.
Assignment
Tristan's offer has been signed by all parties and delivered back to the seller. This means that ______ has occurred.
Binding acceptance
Which of the following is an example is an escalator offer?
Buyer offers $650,000 with clause that buyer will beat all competing offers by $3,000 up to $675,000
A call from a buyer who saw your sign in the yard of a recent listing needs to be qualified. What problem situation is possible with these types of buyer calls?
Buyer who call after seeing your sign may already be working with a licensee at your firm
When a tenant pays rent to a landlord, the tenant is satisfying which element of a valid lease contract?
Consideration
Real estate sales contracts must be valid, express, bilateral, _____, and executed or executory.
Enforceable
A buyer, hoping to beat out all other offers, included a clause in the offer that reads, "Buyer to beat all competing offers by $1,000 up to a price of $700,000. Seller to provide copies of competing offer to buyer on acceptance." What type of offer is this an example of?
Escalator
Janice wanted to sell her townhome, and her neighbor was considering buying it. She wanted to put it on the market while she waited to find out if her neighbor was going to buy. In order to receive the best possible representation but avoid paying a commission if her neighbor buys the property, which type of listing agreement would best suit Janice's needs?
Exclusive agency
Which is the following is the most common type of buyer representation agreement?
Exclusive right-to-represent agreement
Which of the following agreements gives you the sole right to represent a buyer?
Exclusive right-to-represent agreement
Which of these is an example of good consideration?
Gifting a house to a family member
Kramer is a buyer who just signed a buyer agency agreement. He likely did this so that ______.
He would receive a higher level of service
Paulo signed an open listing agreement with Debbie, his real estate agent. Which of the following statements is true?
If Paulo finds a buyer on his own, he owes no one a commission.
Alex, a high school freshman, started a neighborhood lawn care business. Simone decides to hire Alex to mow her lawn every two weeks. Alex presents Simone with a written contract outlining the services to be provided and the fee Simone will pay. Which of the following is true in this situation?
If both parties are content to uphold their agreement, the fact that it's not legally binding doesn't matter.
Amira's seller Tom just received the news that his buyers are walking away from the sale. They weren't willing to proceed after they saw the inspection report. Neither Amira nor Tom has requested a copy of the report. What's the most likely reason for that?
If they see the report, they'll be required to disclose any adverse findings.
When working with potential buyers who say they just want a little information but won't sign a buyer representation agreement, why should you recommend they become clients?
If they won't sign an agency agreement, there's a higher chance they won't be loyal to you.
Which of the following describes a contract that exists based not on words, but on the parties' actions or behaviors?
Implied
Hannah wasn't able to get the financing to open her boutique, so her mother came on as a silent partner and provided additional cash. Hannah and her mother have an agreement that states Hannah's mother can't be held financially or legally liable if there are any problems with the store. What type of contract clause is this?
Indemnification
Which clause in a contract states that one or more parties won't be held liable is there are losses or expenses related to the contract?
Indemnification clause
When buyers contact you for the first time, why is it important to ask how they found you?
It can help you determine what additional questions to ask.
Why might a licensee want a buyer to sign a buyer reorientation agreement?
It helps ensure the buyer loyalty
Drake's offer to purchase Kevin's condo currently has a financing contingency, an inspection contingency, an appraisal contingency, and a sale of current home contingency. Kevin also got an offer from Lucy, which came in at $5,000 less than Drake's offer but with only an appraisal contingency. What is true about Drake's offer compared to Lucy's?
It's likely viewed as a less favorable offer.
What happens to an initial offer from the buyer after a seller counters?
It's no longer in play.
What happens when to an initial offer from the buyer after a seller counters?
It's no longer in play.
What's required for both assignments and subleasing in most cases?
Landlord approval
The residents of Blair Avenue are close-knit bunch. They're all young couples with small children, and they don't want this dynamic to change when two of the couples have to move. Those couples sign an agreement promising not to sell to anyone without kids or to anyone over the age of 50. The contract can't be enforced because it's missing____.
Legal purpose
Damien was representing a commercial property owner. Which one of the following duties can the owner expect Damien to perform on the property owner's behalf?
Locate and qualify potential tenants.
Licensee Gwen and her buyer client Marcus are writing up an offer on Clayton's property. Gwen will need to use an additional provision in the offer. Which of the following reasons for using an additional provision apply?
Marcus is requesting that all mechanical system and appliance warranties transfer to him.
A legally competent party means that an individual has the capacity, legally and ____, to enter into a contract.
Mentally
Home inspection Maura was walking Thad through a property inspection. The frame house, on a slab foundation, had mulch piled up about 18 inches next to the house. Why was Maura nothing noting this as a concern?
Mulch next to wood siding may lead to wood rot.
In a purchase offer, is earnest money required in order to have a binding contract?
No, because the buyer's consideration is the promise to buy.
Serena just finished making a buyer presentation to Mark and Debbie Calhoun. Now that they understand the difference between being customers and being clients, they're anxious to be represented. What is one of their duties as buyers represented by an agent?
Notifying Serena of any material changes
Under which types of agency agreement may a buyer and agent operate?
Open, exclusive right to represent, and exclusive agency
UETA supports the use of electronic documents and leaves the decision whether to use an electronic medium for agreements up to the _______.
Parties
When multiple offers are received, which of the following is something a licensee should do?
Prepare net proceeds statements on all offers.
Jerry and Simon signed a contract so that Jerry could purchase all of Simon's restaurant equipment for one price after Simon closes his restaurant next month. The contract contains a provision that states Jerry has one year from the purchase date to file a suit relative to the purchase. After the year is up, Jerry forfeits the right. What kind of contract clause is this?
Statute of limitations
Which of the following is a primary focus of the statue of frauds as it relates to real estate transactions?
Real estate purchase and sale contracts must be in writing to be enforceable.
Other names for the ____ are offer to purchase, sale agreement, contract of purchase and sale, purchase agreement, and earnest money agreement.
Sales contract
Eleanor is moving from a starter home into something a little larger. Her agent has cautioned her against making the offer on the new place contingent on the sale of Eleanor's starter home. Why the caution?
Sellers would view an offer without that contingency as a stronger offer.
Licensee Alex is doing a buyer presentation for the Reynolds family. She explains that she would be committed to helping them find a property they will best meet their needs. She will work around their second-shift schedules whenever possible, and always returns calls within the same business day unless she is with another client. Which quality does this demonstrate?
Service mindset
Bonnie always schedules an in-person meeting with prospective buyers before she begins sending them data on properties. Why might this be?
She needs to define the buyer's needs and wants.
What's an advantage an in-person meeting has over another way of communicating with a potential buyer client?
Since they've had face time with the license, buyers are more likely to stay with that broker.
Which of the following entities created the consumer information booklet?
The Alabama Real Estate commission
Contingencies normally include the responsible party's name, the deadline for the contingency removal, and _______.
The actions required for removal
In a caveat emptor state, who or what entity has the burden to prove that a seller was dishonest about a property's condition?
The buyer
A prior client referred her sister to you because she wants to finally buy a house instead of renting. When you meet with the sister, she shares that she's been looking for almost 18 months and "simply can't find anything suitable." What red flag does this indicate?
The buyer has unrealistic expectations and may never commit
Which of the following statements about the number of contingencies in a sales contract is true?
The inclusion of numerous contingencies makes it less likely that the buyer's offer will be accepted.
How does the "break-even point" relate to percentage leases?
The landlord doesn't charge a percentage of sales until the tenant's sales exceed a break-even point.
If a party to a contract lacks legal capacity but enters into a contract anyway, which party may void the contract?
The party lacking legal capacity
Hank leases 150 acres from Sara and Jesse. He has an option contract attached to his lease, with an option to purchase that can be exercised within the next two years. What type of contract is this?
Unilateral
You receive an offer in the mail that says you're eligible to win a cash prize if you place some stickers on a form and return it to the sender. What type of contract is this?
Unilateral contract
Rex needs to handle some money he acquired during an "unsavory" business deal. He agrees to sign his boat over to his colleague, Ben, if Ben can launder the money and return it to Rex as part of a legal business dealing. What kind of contract do Rex and Ben have?
Void
You sign a contract to purchase a machine that will allow you to travel back in time and meet Abraham Lincoln. Assuming that time machines don't actually exist (for now), what type of contract is this?
Void A party can't promise to do something that's actually impossible in a contract. This contract is void because the seller of the machine literally can't perform his side of it.
Ken signed a contract to purchase Debra's condo. Ken signed the contract two weeks prior to turning 18, which is the age of majority in his state. Debra found out about his age prior to the closing but honored the contract, and they closed on the condo a month after Ken's birthday. What was the status of the contract when Ken and Debra entered into it?
Voidable
Robert and Sarah enter into a contract for Sarah to purchase Robert's home. Robert decides he doesn't want to sell, and is elated when he finds out that Sarah's only 17 years old. Can Sarah force Robert to sell?
Yes, Sarah can require that Robert fulfill the contract terms.