Promulgated Forms- Unit 7 True/False Quiz
True
If a buyer does NOT deposit the earnest money as agreed in the TREC One to Four Family Residential COntract (Resale), the buyer will be in default.
False
If a property has mandatory membership in an owners association, it is necessary to use the TREC Addendum for Property Subject to Mandatory Membership in an Owners Association and to list that addendum in paragraph 11.
True
If a property is damaged by fire, after it has been put under contract, and the seller is unable to repair the damage by the closing date, one of the buyer's options, according to the TREC One to Four Family Residential Contract (Resale), is to accept the property in its damaged condition and accept an assignment of the insurance proceeds.
False
If a seller wants to continue to show her property for backup offers, it is necessary to add that information to paragraph 11 of the TREC One to Four Family Residential Contract (Resale).
True
If any sales expense exceeds the amount agreed to by a party in the TREC One to Four Family Residential Family Contract (Resale), that party may terminate the contract unless the other party agrees to pay the excess.
False
If no changes are made to the TREC One to Four Family Residential Family Contract (Resale), the seller will furnish the buyer a special warranty deed at the time of closing.
True
If the buyer agrees to deliver a credit report to the seller, according to paragraph A of the TREC Seller Financing Addendum, the cost of the report will be the buyer's expense.
True
If the buyer and the seller agree that the seller will have the foundation repaired and the buyer wants the warranty for that work transferred to him, the transfer will be at the buyer's expense according to the TREC One to Four Family Residential Contract (Resale).
False
A buyer receives the survey and discovers a utility easement created by the dedication deed and plat of the subdivision. The buyer discovers that the easement is in an area that will prevent the addition of a swimming pool. If nothing has been added to the TREC One to Four Family Residential Contract (Resale), the buyer has the right to terminate the contract if she objects within the proper time frame.
False
A contract is subject to financing. The loan is turned down by the lender because the property did NOT appraise for enough money. The buyer will be in default if the option period has already expired.
False
A seller who is lender that has foreclosed on the property is exempt from obligation to give the Seller's Disclosure Notice. No boxes will be checked under paragraph 7B.
False
According to paragraph 18 of the TREC One to Four Family Residential Family (Resale), if the buyer and the seller mutually agree to terminate the contract and the seller agrees to release the earnest money to the buyer, the title company must refund all of the earnest money to the buyer.
False
According to the TREC One to Four Family Residential Family Contract (Resale), if a PMI premium is due, it is negotiable item between the buyer and the seller.
False
The title company furnishes copies of the restrictive covenants to the buyer at the seller's expense.
False
When using the TREC One to Four Family Residential Family Contract (Resale), if you are acting as an intermediary, it is necessary for you to add the buyer's representation agreement and add it in paragraph 22.
False
The Seller's Disclosure Notice should be attached to the contract and listed in paragraph 22.
False
The TREC One to Four Family Residential Contract (Resale) has a provision that makes any party that fails or refuses to sign a release of escrow liable to the other party for liquidated damages in the amount of three times the amount of the earnest money.
False
The sales price is $100,000. The buyer is making a first lien mortgage for $80,000, and the seller is carrying a second lien for $10,000. The amount is paragraph 3B should be $80,000.
True
Paragraph 7B(2) of the Residential Sales Contract is checked, and three days are entered in the blank. The Seller's Disclosure Notice is delivered on time. Two days later, the buyer sees another home he likes better. The buyer is free to terminate this contract even though he did NOT pay for an option to terminate.
True
Paragraph 7G of the TREC One to Four Family Residential Contract (Resale) cautions the buyer to use an addendum regarding environmental issues if he is concerned about those matter.