Promulgated Contract Forms Test

Anytime money goes to the buyer without the knowledge of the lender it is _______.

Illegal

Which of the following statements is TRUE about situations in which the property is not in a MLS?

There is no offer of compensation

How many public members are on the Broker Lawyer Committee?

1

A seller owns half of his minerals. He is selling his home and on the Addendum for Reservation of Oil, Gas and Other Minerals he checked the box and said he is reserving 50% of all minerals he owns. If buyer agrees, what part of the total mineral estate is the buyer receiving?

1/4

Within how many days after the effective date of the contract must the option money be delivered to the seller according to Paragraph 23?

3

TREC promulgated a new One-to-Four Family Residential Contract and it became mandatory for use on May 1st. A licensee just kept using the old form. The licensee is _______.

Guilty of a violation of TRELA

If nothing is added in Paragraph 7D, the agreement says that the buyer is accepting the property _______.

In its present condition

Which form must licensees give to any unrepresented buyer or seller they are meeting?

Information about Brokerage Services

Who is exempt from the Civil Rights Act of 1866?

It only included race and no one is exempt

The option to terminate paragraph is a unilateral contract within the big contract for a limited amount of time. It requires separate consideration to be valid. What is the buyer's consideration for the option?

Option money

The TREC Seller's Disclosure is _______.

Optional

The amount of option money is the decision of the _______.

Parties

Which TREC promulgated contract form(s) tells the buyer to determine the availability of utilities to the property in Paragraph 7?

The Unimproved Property Contract

Both the Texas Real Estate Commission and the Texas Association of REALTORS® have a Seller's Disclosure form and they are really different. Some brokers have their own form. Which one does the agent need to use?

The agent can use either one because the TREC form is not promulgated.

Who is to complete the effective date?

The agent who gets the final signature and/or initials and communicates the acceptance to the other party or their agent

The seller was supposed to deliver the Seller's Disclosure to the buyer within five days after the effective date and he has not delivered it yet. Closing is only a week away. What are the buyer's options under the contract?

The buyer can terminate the contract and receive the earnest money back.

In a transaction a Third Party Financing Addendum says "financing approval" must be obtained within 10 days after the effective date. On the twelfth day the buyer learns the property is uninsurable and will not meet lender requirements. Which of the following statements is TRUE about this situation?

The buyer may terminate the contract and the earnest money will be refunded to the seller.

When seller financing is being used the seller becomes which of the following things?

The lender

After receiving the Commitment, Exception Documents, and the survey, how long does the buyer have to object?

The number of days agreed to by the parties

Adding or striking things from the preprinted contract forms (except at the request of the principals) is _______.

The unauthorized practice of law

If clients want to make an offer to the seller offering a "lease with option to buy" the buyer's agent should use which form?

There are no TREC or TAR forms for a lease with option to buy. They need an attorney to draw the forms.

For how many years must the broker maintain a copy of the signed Lead Based Paint Addendum following the sale?

Three

Where will the title company send a copy of the commitment and the restrictive covenants within 20 days after they receive the contact?

To the buyer at the address listed in Paragraph 21 of the contract

A contract with a minor is _______.

Voidable

When must the buyer receive a Residential Real Property Affidavit Promulgated by the Texas Department of Insurance (T-47 Affidavit)?

When the seller provides the existing survey

What should you tell buyer clients about their earnest money if the transaction doesn't close?

You may not get back all of the earnest money.

What should the buyer check to be sure what kind of pets and how many pets are going to be allowed on a certain property?

All of these things

The Loan Assumption Addendum says that if the balances being assumed vary more than what amount, either party may terminate unless the other party eliminates the variance?

$500

What is the lowest amount of earnest money a buyer can put up and still have a valid contract?

-0-

How is the amount of earnest money required in a contract determined?

Agreement of the parties

The agent can catch mistakes early in the transaction by checking what information on the commitment for title insurance?

All of the above

A buyer on a back-up contract with an option to terminate can terminate _______.

All of these are true.

A listing agent has a seller that orders the agent not to show the home to people of a certain national origin. What should the agent do?

All of these choices

John terminated his contract during the option period. The seller will not release the earnest money. John sent a written demand to the escrow agent for the money and the seller sent one too. Now John is going to court. How much liquidated damages should John get according to the TREC contract?

All of these choices

Risk management for a real estate agent includes which of the following things?

All of these choices

Which of the following situations is an exception to the rules requiring that promulgated forms be used by the licensee?

All of these choices

Which of the following things is an essential element of a legally valid real estate contract?

All of these choices

Who is exempt from the federal Fair Housing Act?

All of these choices

According to paragraph two which of the following items stay with the property as accessories?

All of these things

Which offers the seller is free to consider until an offer has been accepted?

All offers

According to the Third Party Financing Addendum, which of the following is NOT necessary for "Financing Approval"?

An appraisal for at least the sales amount must be received.

A seller is asking to stay in the property for three days after closing and funding. What should the parties do?

Both b and c are correct.

A seller owns all of his minerals. If he sells his home and neither party addresses the minerals, who will own the minerals after the transaction closes?

Buyer

What warning is found in Paragraph D of the Sale of Other Property Addendum?

Buyers shouldn't waive the contingency unless they are certain they can close.

How is an implied contract created?

By actions

What should the agent do if a buyer wants to have the title policy amended to read "shortage in area" rather than the standard exception and is willing to pay for that change?

Check the proper boxes in Paragraph 6A8, Title Policy and Survey of the contract.

Which of the following are essential elements of a real estate contract?

Consideration and competent parties

The Statute of Limitations involves which of the following things?

Deadline for filing lawsuits

The title policy has eight _______ that are not covered.

Exceptions

A buyer decides to exercise her right to terminate under the Third Party Financing Addendum for Credit Approval. What is the proper process?

Execute and deliver a notice of buyer's termination of contract

In Texas, an option to buy that includes a residential lease is considered which of the following things?

Executory contract

What does the title of a promulgated contract form indicate?

Its intended use

Who is usually the victim in a loan fraud transaction?

Lender

On the Short Sale Addendum the effective date is amended to the date the seller notifies the buyer that the _______.

Lender has approved the short sale

Paragraph A of the Short Sale Addendum protects the seller by describing which of the following terms?

Net proceeds

What should be included in the contract if the buyer wants to keep the free standing bookcase?

Non Realty Items Addition

In which section of the sales contract can buyers list things they want to do with the property that may not be allowed due to restriction?

Objections

If a buyer negotiates a contract on a property with the Addendum for Property Subject to Mandatory Membership in a Homeowners' Association and asks to receive the documents with five days of the effective date, how long after receipt does the buyer have to terminate?

3 days

A buyer delivers her credit information to the seller in a timely manner and the seller determines it is unacceptable. According to the Assumption Addendum, how many days after the date for the expiration of the time for delivery does the seller have to terminate?

7

Which paragraph in the Addendum for Reservation of Oil, Gas and Other Minerals defines what the term "mineral estate" does and does not include?

A

A seller wants to be sure he can get VA entitlement restored when he agrees to allow another veteran to assume his mortgage loan. What should be attached to the contract?

A seller wants to be sure he can get VA entitlement restored when he agrees to allow another veteran to assume his mortgage loan. What should be attached to the contract?

Notices from one party to the other party under the contract are only effective if sent to _______.

One of the methods listed in Paragraph 21, the Notices Section

According to the One-to-Four Family Promulgated Contract, the cost of the survey is the responsibility of the _______.

Party that agreed to pay the cost

If seller is going to furnish the existing survey, he or she must provide what other document(s)?

T-47 Affidavit

Both contracting parties have the same basic rights when the other party defaults. What are they?

Specific performance and liquidated damages

A seller furnishes an existing survey to the buyer, but it is not acceptable to the title company. Who will pay for a new survey?

The party negotiated in the contract