RealEstateU- Texas Law of Contracts

A married couple is exempt from paying taxes on any capital gains under?

$500,000

Andrew was pre-approved for a $200,000 loan. How much money will Andrew have to put down if he makes $275,000 offer on a property...?

$75,000

David's property is owned under the LLC 123 Bank Street LLC. If David decides to sell the property, how should the name of the seller appear on the contract?

123 Bank Street LLC

The Texas Real Estate Commission was created in what year?

1949

If an agent is sued under the DTPA, they may be sued for up to how many times the actual damages?

3x

What is the primary distinction between a tenancy in common and a joint tenancy?

A joint tenancy includes the right of suvivorship

What should a real estate agent have their client obtain before viewing any properties?

A pre-approval letter from a lender

Who conducts a title search?

A title abstractor

An appraiser will document the appraised value of a house on the?

A. Uniform Residential Appraisal Report

The rights in real property to the reasonable use of the air space above the surface of the land are known as?

Air rights

Lisa was found guilty under the DTPA. Lisa may be subject to which of the following? A. Suspension of her real estate license B. Revocation of her Association of Realtors memebership C. Punitive damages D. All of the above

All of the above

RESPA does not apply to which of the following? A. Sellers financing B. The buyers assumption of the sellers existing mortgage C. Contract for deed. D. All of the above

All of the above

Real estate brokers are not permitted to do which of the following? A. Draft new contracts B. Provide legal advice C. Revise the Texas Promulgated contract forms D. All of the above

All of the above

What should a buyer do in preparation for closing? A. All of the above B. Obtain a chashiers check C. Conduct the final walk-through D. Compare the good faith estimate to the HUD-1 form

All of the above

Which of the following business entities can own real property? A. Corporations B. Limited Liability Companies C. Partnerships D. All of the above

All of the above

Which of the following is a credit reporting bureau? A. Equifax B. TransUnion C. Experian D. All of the above

All of the above

Which of the following is required in a valid deed? A. All of the above B. Consideration C. Habendum Clause D. A granting lease

All of the above

Which of the following may be prorated between the buyer and the seller? A. Insurance premiums B. Rents C. Taxes D. All of the above

All of the above

Which of the following should be done if the seller agrees to offer the buyer a credit for defects found during the property inspection?

Amend the original contract

Who is authorized to provide legal advice to sellers?

Attorneys

In order to help prevent the buyer from withdrawing their offer, when should a seller provide a prospective buyer with the property disclosure form?

Before the prospective buyer makes an offer

A written listing agreement between a broker and his/her principal is considered what type of contract?

Bilateral contract

A written instrument given to pass title of personal property from a vendor to a vendee is referred to as a?

Bill of sale

Which of the following is an example of a legal description of a property?

Block and lot number

Title which is not encumbered or burdened with defects is known as...?

Clear Title

The escrow agent typically serves as the?

Closing agent

A legally enforceable agreement to do, or not to do something is called a/an?

Contract

A form of ownership in which stockholders in a corporation occupy property owned by the corporation under a lease is known as?

Cooperative

An entity established and treated by law as an individual or unit with rights and liabilities, or both, distinct and apart from those of the persons composing it is known as a...?

Corporation

In a closing statement, money to be received is referred to as a?

Credit

In a closing statement, an expense or money received against a credit is referred to as a?

Debit

The DTPA is an acronym for which of the following acts?

Deceptive Trade Practices Act

A written document by which ownership of land is transferred from one party to another is known as a?

Deed

A real estate brokers license may be revoked for which of the following acts?

Drafting a new deed for a client

The broker/lawyer committee is responsible for which of the following?

Editing the promulgated contract forms

The crops and other annual plantings considered to be personal property of the cultivator are known as...?

Emblements

The neutral third party holding funds or something of value in trust for another or others is known as the?

Escrow agent

The moral principles that govern a persons or a groups behavior are known as?

Ethics

Individuals who are liable for a lot of debt will most likely obtain what type of loan?

FHA-insured loan

As an agent to the seller, the broker should fill out the seller disclosure form on behalf of the seller?

False

In order to simplify the process, a real estate agent should only recommend one mortgage broker to their clients? A. True B. False

False

An inheritable estate in land providing the greatest interest of any form of title is known as?

Fee simple absolute

An estate that will end automatically when the stated event or condition occurs is referred to as a?

Fee simple determinable

Absolute ownership of real property is known a/an?

Fee simple estate

A suit to quit title is used to do which of the following?

Fix a defect in title

An estate of indeterminable duration?

Freehold estate

At a closing Buyer Betsy and George were provided a deed to transfer the property to them from the seller. What type of deed would Buyer Betsy and George most likely receive from the seller at closing if there were no issues at all with the title of the property?

General Warranty Deed

What type of insurance do most lenders require of homebuyers?

Homeowners insurance

When representing a seller, what is the very first form the broker must have the seller review and sign?

Information About Brokerage Services

Which of the following should not be included in the Special Provisions part of a contract?

Information found in an addendum

Each page of the sales contract must be?

Initialed

David recently lost his property through a foreclosure sale. This is an example of?

Involuntary alienation

How does the pre-approval letter from a lender help a buyer?

It gives the buyer an idea of how much they can afford

Real estate agents are not permitted to practice which of the following?

Law

Real estate brokers are permitted to do which of the following?

Market a property

The landowners ability to take minerals from the earth or to sell or lease this right to others is known as?

Mineral rights

A voidable contract is typically used by a?

Minor

A structure transportable in one or more sections in one or more sections, designed and quipped to contain not more than two dwelling units to be used with or without a foundation system is referred to as a?

Mobile home

Since Buyer Kyle did not discuss anything about earnest money and/or option monies, could Seller George go back and void the contract?

No because earnest and option monies are not a requirement for a valid contract

When transferring the property to Buyer Betsy and George the seller would need to sign the deed as the ______ and Buyer Betsy and George would need to sign the deed as ________? A. Grantor/Grantee B. Grantee/Grantor C. Trustor/Trustee D. None of the above

None of the above

An irrevocable right to buy a property at an agreed upon price is called a/an?

Option

Title insurance is commonly broken down into a lenders policy and a ?

Owners policy

What should a buyer perform right before closing on a property?

Perform a final walk-through

All property that is not considered to be real property is known as?

Personal property

This is a step above prequalification, it involves verifying a purchaser's credit, down payment, and employment history...?

Pre-approval

What is the first step in the loan process?

Pre-qualification

This refers to the diving of taxes or proportionately to time of use, usually between the seller and buyer?

Proration of taxes

According to TRELA, real estate brokers are unauthorized to do which of the following?

Provide legal advice

Which of the following acts prohibits kickbacks and other referral fees between lenders and real estate brokers?

RESPA

The Texas Real Estate License Act was formally known as the?

Real Estate Dealers License Act

Land and everything permanently attached to land is known as?

Real estate

A person who inherits or entitled to inherit property upon the termination of the estate of the former owner is known as?

Remainderman

The right of a surviving tenant or tenants to succeed to the entire interest of the deceased tenant is referred to as the?

Right of survivorship

The TREC form OP-H is used for which of the following reasons?

Seller disclosures

Real property that is owned by only one person is referred to as?

Severalty ownership

The effective date of a contract serves as the?

Start date of the contract

The DTPA helps ensure agents do not do which of the following?

Take advantage of buyers lack of knowledge

An estate or interest in land held by two or more persons, each having equal rights of possession and enjoyment, but without any right of succession by survivorship between the owners is considered?

Tenancy in common

Who is responsible for enforcing the Texas Real Estate License Act?

Texas Real Estate Commission

The acronym TRELA refers to which of the following?

Texas Real Estate License Act

The requirements to become a licensed real estate agent in Texas are described in which of the following documents?

Texas Real Estate License Act

Which of the following must be included in a sales contract?

The effective date of the contract

Which of the following is included in a lenders good faith estimate?

The lenders loan origination fee

Which of the following is needed in order to have n executory sales contract?

The signatures of all parties involved in the contract

The evidence of right which a person has to the ownership and possession of land, commonly considered as a history of rights is known as?

Title

Insurance against loss or damage resulting from defects or failure of title to a given parcel of real estate is known as?

Title insurance

A condominium is considered real property

True

A seller can limit their liability by completing the seller disclosure form?

True

The act of reviewing loan documentation and evaluating the borrower's ability and willingness to repay the loan and sufficiency of collateral value of the property is referred to as?

Underwriting

A ______ contract exists when one party promises to do something if the other party performs a certain act, but the other party does not promise to perform it?

Unilateral

What is the maximum fine an agent can receive for punitive damages?

Unlimited damages

A contract that is legally sufficient and authorized by law is considered?

Valid

A contract that does not have force or effect is considered?

Void

That which is capable of being adjusted void, but is not unless action is taken to make it so is considered?

Voidable

Since Buyer Betsy and George decided had to obtain a loan on the property because they did not have the funds to purchase the property outright, this would be what type of encumbrance on the property?

Voluntary alienation

The transfer of title freely by the owner is referred to as?

Voluntary alienation

When is a sellers property disclosure not required?

When property is being sold as a result of a court order

if Buyer Kyle would have agreed to give a Seller George his prized possession and $50,000 in cash, would the contract still be valid?

Yes because both parties would have agreed and thus there would have been consideration

The DTPA was enacted to?

protect the public

Promulgated forms are considered...?

standard forms