Texas Promulgated Contract Forms - Chapter 5

An amendment to the contract

A change to the closing date will require which of the following...? An amendment to the contract A bulletin to the contract A rescission of the contract An addendum to the contract

Mediation

A form of alternative dispute resolution in which the parties to a lawsuit meet with a neutral third-party in an effort to settle the case is known as...? Negotiation Mediation Civil court Trial

90

A temporary lease cannot exceed how many days...? 90 30 7 60

All of the above

According to paragraph 18, the escrow agent is not...? Liable for interest on the earnest money Liable for the loss of any earnest money A party to the purchase contract All of the above

In default of the contract

According to paragraph 19, if any representations made by the seller which are untrue on the closing date, the seller shall be...? Sued for specific performance In default of the contract Required to pay back the buyer's earnest money Required to pay substantial liquidated damages

All of the above

According to paragraph 9, which of the following must be satisfied at closing...? The seller will furnish the buyer with a General Warranty deed The buyer shall pay the sales price in good funds The buyer and seller shall execute and deliver any required notices All of the above

The buyer's written consent

After the effective date, the seller cannot execute any lease without obtaining...? The buyer's written consent An authorized temporary lease A deed The escrow agent's written consent

T (True)

All matters discussed during mediation are confidential...? T (True) F (False)

Specific performance

An action to compel performance of an agreement is known as...? Specific performance Default Execution Commitment

The closing date

Any objections listed by the buyer in the contract must be cured by the seller by what date...? 3 days prior to the closing date 7 day prior to the closing date 21 days after the effective date of contract The closing date

Cash down payment

At closing, the buyer's earnest money must be applied first to any...? Cash down payment Buyer's expenses Seller's expenses Escrow fees

17

Attorney's fees are discussed in which of the following paragraphs...? 2 8 17 21

15

Default is discussed in which of the following paragraphs...? 8 11 15 21

A seller's credit in the amount of the cost of a new dishwasher

During the buyer's due diligence, the buyer learns that the dishwasher no longer works. Instead of replacing the dishwasher themselves, the seller can offer the buyer which of the following...? A seller's credit in the amount of the cost of a new dishwasher A rebate for the amount of a new dishwasher A voucher in the amount of a new dishwasher A pre-paid credit card in the amount of a new dishwasher

18

Escrow is discussed in which of the following paragraphs...? 1 15 18 22

There isn't already a promulgated TREC form to use

Factual statements and business details should only be added to the Special Provisions if...? The seller demands it There isn't already a promulgated TREC form to use The buyer demands it The agent feels it is in the best interest of the principal

The non-defaulting party only

If either party fails to close the sale by the closing date, who may exercise their right to remedies...? Both the defaulting party or the non-defaulting party The defaulting party only The non-defaulting party only Either the defaulting party or the non-defaulting party

All of the above

If the buyer is in default of the contract, the seller may do which of the following...? Enforce specific performance Receive the buyer's earnest money Terminate the contract All of the above

Liquidated damages

If the buyer is in default of the contract, the seller may terminate the contract and receive the buyer's earnest money as...? Specific performance Punitive damages Liquidated damages Notice

Tenancy at sufferance

If the buyer occupies a property prior to closing, without a temporary lease in place, they will occupy the property as a...? Tenancy in common Tenancy at sufferance Tenancy at will Tenancy in partnership

TREC temporary residential lease form

If the buyer will occupy the property prior to closing, what form must be included with the contract...? TREC temporary residential lease form TREC seller financing form General warranty deed TREC ground lease

Fair market value

If the seller occupies the property after closing, under a temporary lease, they must pay rent according to which of the following...? Assessed value A flat fee of $100 per day 20 percent (%) below market value Fair market value

30 days

In a typical residential transaction, the closing date is ......... from the effective date of the contract? 30 days 45 days 60 days 90 days

16

Mediation is discussed in which of the following paragraphs...? 4 8 16 21

Possession

Paragraph 10 of the One to Four Family Residential Contract - Resale primarily deals with...? Closing Earnest money Possession Financing

Federal tax requirements

Paragraph 20 discusses which of the following...? Proration Escrow Notices Federal tax requirements

Agreement of parties

Paragraph 22 discusses which of the following...? Escrow Escrow Legal Description Agreement of parties

12

Seller's credits to the buyer are listed in which of the following paragraphs...? 3A 9 12 18

12

Settlement and other expenses is discussed in which of the following paragraphs...? 7 8 12 19

11

Special provisions are discussed in what paragraph of the One to Four Family Residential Contract - Resale...? 3A 9 11 21

Appraisal fees

The buyer is responsible for paying which of the following expenses at, or prior to closing...? Prepayment penalties Tax statements or certificates Appraisal fees Preparation of deed

All of the above

The buyer is responsible for paying which of the following expenses...? Loan application fees Credit reports Appraisal fees All of the above

Upon closing and funding

The buyer is typically given possession of the property...? Within 7 days after closing 7 days prior to closing Upon closing and funding At the effective date of contract

Proration

The division of certain settlement costs between a buyer and seller is known as...? Proration Accounting Distribution Dividend

Default

The failure to fulfill a duty or promise is referred to as...? Specific performance Default Execution Damages

Escrow agent

The neutral third party holding funds or something of value in trust for another or others is referred to as a...? Trustor Trustee Escrow agent Executor

Alternative Dispute Resolution

The resolution of disputes by various means including, but not limited to negotiation, mediation, and arbitration, is known as...? Alternative Dispute Resolution Civil court Trial dispute resolution Civil dispute resolution

Fees associated with the release of existing liens

The seller is responsible for paying which of the following expenses at, or prior to closing...? Appraisal fees Fees associated with the release of existing liens Credit reports Loan application fees

All of the above

The seller is responsible for paying which of the following expenses...? Release of existing liens Preparation of deed One-half of the escrow fees All of the above

A temporary gap in insurance coverage

The use of a temporary lease may lead to which of the following occurring...? A temporary gap in insurance coverage The buyer losing their earnest money The buyer losing their options money The seller's loss of title

Both parties are released from the contract

What happens if the seller defaults on the contract and the buyer elects to rescind his/her earnest money...? The seller can sue for specific performance The buyer can sue for specific performance The buyer is forced to perform the contract Both parties are released from the contract

General warranty deed

What type of deed is typically used in a residential transaction in Texas...? Grant deed Bargain and sale deed General warranty deed Quitclaim deed

TREC's website

Where can one look to find the most up-to-date promulgated contract forms...? TREC's website NAR's website TAR's website The Department of State's website

9

Which of the following paragraphs of the One to Four Family Residential Contract - Resale deals with closing...? 3A 6 9 21

General warranty deed

Which type of deed offers the most amount of protection to the buyer...? Bargain and sale deed Grant deed General warranty deed Quitclaim deed

The buyer

Who is responsible for ensuring that property insurance is in place after closing and funding...? The seller The escrow agent The seller's agent The buyer