TREC Promulgated Contract
Zella is writing up the TREC addendum for the rototiller that will be included in the sale of the house and property. What information should she include on the addendum?
*The price the seller is asking *Where the rototiller is currently being stored * A detailed description of the rototiller
All of the following statements about the use of promulgated forms in the State of Texas:
-TREC requires their forms to be used -Forms can be downloaded from the Texas Real Estate Commissions website -Company forms must be the same as TREC forms
A listing contract must explain which of the following regarding Texas coastal property?
-That a buyer should get legal advice regarding possible dangers and changes of coastal boundary lines -A provision explaining the natural hazards important to coastal residents -A form that states parties should hire coastal land professionals regarding dangers and changes of coastal boundary lines
The earnest money section of The Resale Residential Contract Form 20-14 would show which of the following?
-The cash deposit amount for the offer -The name of the institution that will hold the earnest money -Any additional earnest money that will be sent to esc-row prior to closing
The term for the buyer signing for a second loan is:
2nd mortgage
Earnest money must be deposited by the close of business on the _______________________.
2nd working day
In Texas, if an offer is drawn up by the buyer and his/her agent without an expiration date then the offer could be valid for:
4 years
When working with the seller, you should explain that the Seller's Disclosure Form is:
A legal statement by the seller and should be truthful
If the requirements are not met by either party to a contract then:
A possible injury exists to the performing party
A written report signed by a person promising the information they provided is true is called a(an):
Affidavit
An applicant for a salesperson license needs to complete which of the following educational courses?
Agency Law Contract Law Contract Forms and Addendums
Fran, a licensee has received four offers for a listed property. What does the State of Texas require?
All offers must be presented
When there are changes made to a purchase and sale contract, in Texas this is called?
Amendments
Upon walking the property Jane wants to buy, she noticed a hot tub that she would like to obtain in the sale. Jane would need to add it as:
An addendum to the sales contract
The seller is required to notify the buyer if the subject house is subject to Homeowner Association Membership (HOA) requirements. Information to the buyer would include:
Annual Dues Payment Requirements Lien considerations of the HOA
Any personal property acquired on a sales contact is sold:
As is
It is important that all addendums to a sales contract:
Be signed and dated by the seller and buyer
Tess, the broker for the seller learns her client knows there are undisclosed defects on the property and the sale has not yet completed closing. What are the legal ramifications?
Both Tess and the seller could be liable
What makes a contract binding?
Both parties involved put the offer and acceptance in writing, sign it, and date their signatures
One of the problems with the TREC Promulgated Forms is that firms have outdated forms. It is best that a salesperson:
Check with the TREC website for up-to-date forms
The earnest money presented by the buyer is important because it is part of the sales contract procedure. The earnest money is which of the following?
Consideration offered by the buyer
The purpose of the TREC Form 40-9 Third Party Financing Addendum is to basically function as a(an):
Contingency on obtaining a loan
An example of an alternative experience that may help the applicant be approved to be a broker in Texas is:
Currently a licensed broker in another state
When there is a problem that prevents the seller from providing a general warranty deed it is usually discovered during:
Escrow Title Search Chain of Title
Resale TREC Form 20-14 is used under what circumstances?
For residential housing for the single family up to a 4-plex
When a buyer pays an option fee to the seller to inspect the property, the buyer cannot:
Get the option fee back
Wendy, the potential buyer has an option fee attached to her offer. During the option period she has all of the following options with the exception of:
She may get an option refund within 10 days of paying the option fee
The date of a sale determines?
Signatures and dates of the buyer(s) and seller(s) on the purchase and sale agreement
The Texas Veterans Home Loan is for purchasing:
Single family residence homes
Besides the legal description being on the Form 20-14 for the purpose of selling residential structures, the form also has which of the following required information?
Street Address City & County
The Resale Residential Contract Form that TREC requires to be used for single homes up to a 4-plex structure is called:
TREC Form 20-14
TREC provides:
TREC real estate forms
: If the loan does not work out, the contingency clause in TREC Form 40-9 states:
The Buyer after giving written notice to the Seller within the specified date may terminate the contract and the earnest money will be refunded to the Buyer
: What is the TREC addendum form that must be used for a buyer to gain early possession?
The TREC 16-6 form is called, "Buyer's Temporary Residence Lease"
At closing most lenders will require:
The borrower to make a payment of interest that includes the remaining number of days in the month of closing
How does insurance on the property work during the period the seller/tenant is renting the property from the buyer/landlord?
The buyer and the seller will each need to consult their insurance agent to ensure proper coverage/liability is in place
Lenders are willing to issue FHA loans to a qualified applicant at a lower interest rate than conventional loans because:
The buyer has to pay for the FHA loan insurance
Which of the following statements forms a purchase contract?
The buyer offers to purchase at the seller's price and the seller accepts
Aaron, the buyer tells the seller he is selling the property "as is":
The buyer should insist on full disclosure before agreeing to the sale
The Texas Real Estate Commission is also referred to as:
The commission
When we talk to our principal involved in a sale, we must explain that the Closing Date is which of the following?
The date the deed will be recorded with the county The date the title will change The date the seller needs to be out of the house
What happens if there is a vacancy on Broker-Lawyer Committee during a member's term?
The entity making the original appointment shall appoint a new person to fill the unexpired term
How may a buyer obtain the right to evaluate the property they are interested in?
They pay the seller a termination option fee directly to the seller
At closing what is required of the seller?
To deliver the general warranty deed and to deliver a clear title
If a seller wishes to keep the refrigerator and the custom stained glass window, these would be listed in what part of TREC Form 20-14?
Under Exclusions
John bought a home from an heir who inherited the house. Unfortunately, the heir was 17 at the time of purchase. This means that John is:
bound to the contract
Barbara is a designated broker for Even Realty. She had a disagreement with the unlicensed owners and pulled her license. All the salespersons:
cease real estate activities
To amend means to:
change
Hiding information is called:
concealment
The earnest money presented by the buyer is important because it is part of the sales contract procedure. The earnest money is which of the following?
consideration offered by the buyer
Gus wants to buy a listed home, but only if he can build a shop to repair his equipment. What should the broker use to make sure Gus can find out if a shop can be built?
contract contingency
The Department of Public Safety does which of the following for the Texas Real Estate Commission?
criminal back ground checks for the licensees
If a buyer failed to meet the terms of the contract the buyer becomes a:
default buyer
Schedule A of the title insurance policy would not contain:
exceptions/exclusions
When both the buyer and seller sign a purchase agreement and the buyer gives earnest money, the next step in the process is:
excrow
When a buyer pays an option fee to the seller to inspect the property, the buyer cannot:
get the option fee back
All notices from one part to the other must be _____________________ and are effective when mailed to, hand-delivered at, or transmitted by fax or electronic transmission.
in writing
Which is not a requirements of a valid real estate contract?
incompetent parties
If the seller has to stay beyond the closing date, the seller can:
lease the property after closing
Texas is one of the few states that pushes the use of mediation between buyers and sellers. The mediation process vs. a full blown lawsuit is:
less expensive
The term that states the house purchase is dependent on the buyer obtaining a loan from a lender is called:
loan contingency clause
When a buyer agrees to buy the listed property, this begins what requirement to make the contract valid?
offer and acceptance
The legal term that denotes that all the contract terms have been met by the parties is called:
performance
When all parties to a contract have brought forth all their requirements, they have said to have:
performed
When making an offer to buy, it helps to:
set a specific time limit on the offer
The term that means the time period during which a party may file a civil lawsuit for injury:
statue of limitations
The buyer returns the seller's offer with changes. The seller does not agree with the changes. The buyer then requests the seller agree to the original offer. What is the status of the earlier offer?
If the seller puts in writing they will accept the original offer and the buyer accepts this in writing, it would be considered a new and accepted offer
Mary is buying a farm in East Texas. To her, the fence line looks out of whack. How can she clarify the situation?
In the offer, require a survey contingency paid by the seller
TREC Form 40-9:
Informs the buyer and seller of 3rd party financing
A third counteroffer is made, and if the other party accepts
It becomes a contract, any changes would be a breach of contract and any party not performing would be subject to legal action
RESPA Laws make it illegal if you are receiving a ____________ from the title company.
Kickback
A contractor is suing a homeowner for non-payment. The legal profession will tie up the property while the lawsuit is pending. This type of notice and lien is known as:
Lis Pendens
Property on the Gulf Coast or the Rio Grande River must contend with:
Obtaining and environmental report for any buyer
When escrow closes, the buyer and seller split the closing costs on a 33% and 67% basis. Where was this determined?
On the original buyer and seller contract
Martha is going from an inactive to an active salesperson. What procedure requirement must she fulfill first?
Provide proof of attending at least 15 hours of approved continuing education as specified under Section 1101.455 during the two years preceding the date of her application to active status.
A licensed Home Inspector is hired by the buyer to inspect the subject home. The home inspector is to:
Remain neutral and report on the property only
When do the requirements of the Texas property code NOT apply relating to security devices?
When the residential lease is 90 days or less
When the seller is the temporary tenant and the buyer requires the seller/tenant to supply a lease deposit at closing, when would the landlord/buyer need to refund any deposit?
Within 30 days after the seller/tenant moves out
Which of the following would not be a specific exception/exclusion?
a type of policy being issued
Jason drugged his neighbor Tim and told him to sign the easement papers. This is an example of a(an):
a void contract
The term used to describe a specialized activity that addresses lead in a house is:
abatement
In order for a contract of sale to be formed, one party has to make an offer and the other party:
accepts the offer as made
The term to describe a person who does have authority to make a final ruling between two conflicting parties:
arbitrator
When a purchase agreement or contract is signed by both the buyer and seller but not yet closed it is a:
binding contract
Once a real estate contract is formed:
both parties must perform
Who would likely not be knowledgeable of endorsements regarding a title insurance policy?
the buyer
In other states who may have control over environmental areas?
the county Municipal governments Federal governmental agencies
All of the following are TREC earnest money requirements with the exception of
the earnest money is held by the seller, it's help by a 3rd party in a trust account
Which of the following would not be addressed in the TREC promulgated form for buyers who lease the property prior to closing?
the lending institution is named
A licensed sales agent does not have to use the promulgated forms if the client attorney is drawing up a custom contract OR:
the seller is writing up his or her own contract
Termination options benefit the seller in all the following ways with the exception of:
the seller must return the option fee
The State's Statute of Limitations time period is decided by:
the state
Under the TREC Temporary Lease, who would be responsible for maintaining the grounds on the property?
the tenant
If the broker of a firm dies, what is the status of the affiliated salespersons?
they may not participate until they are affiliated with a broker
How may a buyer obtain the right to evaluate the property they are interested in?
they pay the seller a termination option fee directly to the seller
What happens if the seller does not remedy required deficiencies before closing?
this is addressed in the closing statement of the contract
Boundary claims against a homeowner would be protected against by their:
title insurance
Who puts together the added endorsements to the title insurance coverage?
underwriters
Sam receives an offer on his property. The potential buyer would like the house but offers $40,000 less than Sam's listed price. Sam said no, but offered a price $20,000 less. The buyer's original offer is now:
void
Jerry has 5 years of active experience as a licensed salesperson. How many more hours of experience is necessary to apply for the broker license?
zero