Unit 25: Contract Forms for Real Estate Practice in Georgia
T/F: In a brokerage engagement, regardless of which party the broker represents, the buyer, the seller, or both may compensate the broker in the transaction.
True As long as the source of the compensation is disclosed to all parties as required under BRRETA, the broker may receive compensation from one or both parties in a transaction.
T/F: Residential leases in Georgia require legal descriptions if the agreement is in writing and the rental term is longer than one year.
True Residential leases in Georgia for a year or less may identify the property sufficiently by an address. This lease may be established verbally by tenant and landlord and is enforceable as such.
An offer is made by buyers for $500,000 with the following provisions: a 90% loan, a 7- day inspection contingency, a 14- day appraisal contingency, and a closing date of June 30. The seller accepts all the items except the closing date. The seller agrees to all the loan provisions and the contingencies but asks her listing broker to change the closing date to July 31 to give her more time to pack her belongings and secure a contract on another home. The seller's counteroffer is considered A) a completely new offer that may be accepted or refused by the purchaser. B) a new contingency to the original offer. C) a conditional acceptance of the original offer. D) an amendment to the purchaser's original offer.
a completely new offer that may be accepted or refused by the purchaser.
A landlord has failed to maintain a property, and the property is an unfit place to live, as a result . The tenant chooses to vacate the property and suspend rent payments to the landlord. This action by the tenant is considered A) court-ordered eviction. B) an actual eviction. C) a self-help eviction. D) a constructive eviction.
a constructive eviction.
A buyer and a seller have a major dispute regarding the disbursement of an earnest money deposit. Each party claims the deposit. The escrow agent has several options to consider. The MOST appropriate option may be to A) split the deposit evenly and give half to each party. B) file an interplead action and allow the court to decide the issue. C) give the deposit to the seller. D) return the deposit to the buyer.
file an interplead action and allow the court to decide the issue.
In order for a broker to adequately provide information about the property he is marketing, the seller should prepare a A) a comprehensive hold-harmless agreement to protect the broker. B) federal lead-based paint disclosure if the property was constructed after 1978. C) broker's commission retainer agreement. D) property condition disclosure.
property condition disclosure.
A lease/purchase agreement differs from a lease with an option to purchase agreement in what way? A) A lease with an option to purchase would typically include an earnest money deposit, while a lease/purchase agreement would not because the tenant's security deposit replaces a need for earnest money. B) Unlike a lease with an option to purchase, a lease/purchase contract would not identify a closing date for the sale of the property. C) A lease/purchase agreement includes two attached contracts; a lease with an option to purchase includes only one contract. D) A lease/purchase agreement creates legally enforceable promises from both parties, while a lease with an option to purchase does not.
A lease/purchase agreement creates legally enforceable promises from both parties, while a lease with an option to purchase does not. The lease/purchase contract requires the tenant to purchase the property at the end of the lease term; it also requires the landlord to sell the property to the tenant at the end of the lease term. A lease with an option to purchase creates a promise to sell from the landlord, but only if the tenant decides to exercise the option right and go ahead with the purchase of the property; therefore, the tenant is making no promise to buy in this agreement. A lease/purchase agreement would include a closing date in the purchase and sale contract attached to the lease. The lease contains no closing date sale because the lease is a contract to rent. Both contracts may contain earnest money; in the lease /purchase agreement, earnest money is treated separately from the security deposit in the lease. Both agreements consist of two attached contracts.
Broker Alan has listed the Bakers' house for $395,000. Alan brings buyer Frank with an offer of $395,000 that meets all of the terms of the listing agreement. The Bakers decide not to sell the property. Regarding Alan's commission, A) the Bakers are not allowed to pay Alan without a ratified sales contract. B) Alan has earned a commission according to the terms of the listing agreement. C) Alan does not earn a commission because Frank changed his mind. D) Alan does not earn a commission because the seller did not sign a contract.
Alan has earned a commission according to the terms of the listing agreement
A buyer enters into a buyer brokerage agreement with broker A. The agreement has a protection clause for 60 days from the date the agreement expires. The agreement with A expires without the buyer having purchased a property, and 10 days later the buyer signs a new buyer brokerage agreement with broker B. Twenty-one days after the agreement with broker A expired, but during the agreement period with broker B, the buyer purchases a property she had been shown by broker A. Which of the following is TRUE? A) Broker B is not entitled to any compensation. B) Neither broker A nor broker C is entitled to compensation because of the protection clause. C) Broker A is entitled to compensation because the 60-day protection clause was in effect. D) Broker A is not entitled to any compensation.
Broker A is entitled to compensation because the 60-day protection clause was in effect.
A single active duty member of the Georgia National Guard is assigned to the Middle East for a one-year tour of duty. The service member has six months remaining on his lease. Under both federal and Georgia law, can the service member terminate his lease? A) Yes, because the law requires a federal tour of duty of 60 days or longer. B) Yes, because the law requires a federal tour of duty of 90 days or longer. C) No, because the law requires a federal tour of duty of two years. D) No, because the law requires a federal tour of duty of 18 months.
Yes, because the law requires a federal tour of duty of 90 days or longer.
The language in a Georgia lease may provide for an automatic extension of the rental term without notice of termination by the tenant or a notice of renewal from the owner. If a tenant occupies the property without a written lease with the landlord's consent, the tenant is considered a A) tenant at will. B) life tenant. C) tenant at sufferance. D) tenant from period to period.
tenant at will.
A contingency that provides the buyers with a general right to terminate a contract for purchase is BEST illustrated by which of the following? A) A condition in the agreement that the buyers may, for any reason, change their mind about purchasing the property within a period defined in the contract B) A condition in the agreement that the buyers must have the ability to obtain a loan with terms specifically identified in the contract within a defined time frame C) A condition in the agreement that gives the buyer the right to terminate the contract for any circumstance defined in the agreement between the parties D) A condition in the agreement that the property the buyer is purchasing must appraise for at least the contract price
A condition in the agreement that the buyers may, for any reason, change their mind about purchasing the property within a period defined in the contract No reason for this decision has to be identified in the contract. Conditions attached to loan contingencies and those attached to a property's estimated value are appraisal contingencies.
The brokerage engagement allows for an agent to negotiate a "safety clause" with a client that serves to protect the broker's commission. Which of the following circumstances might activate such a clause in the contract? A) The client defaults on obligations defined in the brokerage engagement. B) After an agency agreement expires, a buyer introduced to the property during the listing term purchases the property directly from the seller. C) A buyer and a seller mutually terminate an existing purchase and sale contract. D) A client does not agree to pay the broker a retainer fee.
After an agency agreement expires, a buyer introduced to the property during the listing term purchases the property directly from the seller. A broker may be reimbursed for marketing expenses or pursue legal action for commissions if a seller defaults, but these actions have nothing to do with the safety clause. Payment of retainer fees has no impact on the safety clause. A broker may earn commission even if a purchase and sale contract is terminated by the parties, but that situation is not a part of the safety clause.
With regard to a tenant's security deposit for a residential lease in Georgia, which of the following statements is TRUE? A) Security deposits must be placed in a trust account. B) Landlords, and the spouse or minor children of a landlord, who own fewer than 10 rental units must place security deposits in a trust account. C) Any security deposit held by an escrow agent must be placed in a trust account. D) Only security deposits held by an escrow agent must be placed in a trust account.
Any security deposit held by an escrow agent must be placed in a trust account. That escrow agent may be a real estate broker, an attorney, or another third party engaged by the landlord. Landlords, and the landlord's spouse or minor children, who own 10 or more rental units and who are holding security deposits must place those funds in a trust account. If these parties hold fewer than 10 rental units, they may hold security deposits in general operating accounts with sole discretion to use the funds.
T/F: Commonly used contract forms for brokerage engagements provide for a client who has not received the standard of professional care required from a real estate agent to sue the broker for damages.
False Brokers and affiliated licensees who are found lacking in the standard professional care of a client are generally limited in liability for a monetary amount not to exceed the sum of the commission the broker actually receives in a transaction.
T/F: In the real estate form used in Georgia as a contract for the purchase and sale of residential real property, term "party" used in the language of the agreement may refer to the buyer, the seller, or the broker assisting the person(s) in the transaction.
False The term "party" refers only to buyers, sellers, or both, not real estate brokers, their affiliated licensees, or any other third person(s) who are involved in the transaction.
T/F: The language of the Georgia Residential Landlord-Tenant Act reinforces tenant responsibilities in a leasing agreement.
False This Georgia law reinforces the landlord's responsibilities under a leasing agreement; because leases are commonly written to protect landlords, statutory laws such as this one in Georgia tend to establish a more equitable allocation of rights and responsibilities between the parties.
The forfeiture of earnest money to a seller from a buyer who is in default of a contract may occur in which of the following circumstances? A) If actual damages by the default are difficult to estimate and the contract considers earnest money an appropriate sum to serve as full liquidated damages for the seller B) After the seller has filed a lawsuit against the buyer in default for actual damages C) Only if the contract indicates that earnest money forfeiture serves as a penalty for a buyer who is in default D) Forfeiture of earnest money automatically occurs whenever the buyer is deemed to be in default of the contract
If actual damages by the default are difficult to estimate and the contract considers earnest money an appropriate sum to serve as full liquidated damages for the seller The contract may award the earnest money as liquated damages for the seller but may not stipulate such payment as a penalty for the buyer. The seller may either claim the earnest money from the buyer as liquidated damages or file a lawsuit against the buyer for damages, but not both. Earnest money is forfeited only if the terms of the contract indicate the circumstances for that action.
Which of the following statements BEST explains why important broker disclosures might be found at the beginning of agency-engagement contract forms? A) Placing disclosures at the beginning creates a shorter, more concise contract form. B) Inserting disclosures at the beginning of the contract form for prospective clients to read more effectively ensures an "informed consent" on their part before committing to the engagement. C) Statutory regulations require that disclosures must be set forth at the beginning of all real estate agency contract forms. D) Separating these disclosures from the actual terms and specific details of the agreement makes it easier for the client to read and understand the contract.
Inserting disclosures at the beginning of the contract form for prospective clients to read more effectively ensures an "informed consent" on their part before committing to the engagement. There are no statutory regulations regarding formatting of these contract forms. The placement of the disclosures has no effect on the length or clarity of the agreement.
Which of the following would be a violation of a broker's duties to a client? A) Disclosing to a seller customer that a buyer client does not plan to occupy the seller's property for which an offer has been submitted B) Showing property in which a buyer client has interest to other perspective buyers C) Not informing a seller client that a prospective buyer-customer is a straw buyer for the true purchaser D) Giving a customer buyer prospect a copy of a county zoning map that includes the listed property of the broker's seller client
Not informing a seller client that a prospective buyer-customer is a straw buyer for the true purchaser This is a material fact for the broker's client. Giving a copy of a zoning map is just a ministerial service for a customer that does not violate a duty to the client. Showing property in which a client has an interest to other buyers is not a breach of duty to the broker's own buyer client. Even though the seller is a customer, the broker would need to disclose the material fact for that seller that the broker's buyer client does not plan to occupy the property purchased.
Portia occupies a property owned by her uncle, who has recently listed the home for sale. Portia pays her uncle a monthly sum of $350 to cover all utility expenses for the property. When a buyer is found for the property, what is TRUE of Portia's occupancy rights under Georgia law? A) Because Portia has no actual lease agreement under Georgia law, she must move out at the discretion of her uncle. B) Portia has a periodic tenancy, which only requires 30 days' notice of termination from her uncle. C) Portia is a tenant at will, and her uncle must give her 60 days' notice to move out. D) Georgia law is silent as to the circumstances in this kind of situation.
Portia is a tenant at will, and her uncle must give her 60 days' notice to move out. Georgia law requires this for a tenancy at will; a tenant must also provide the landlord with a 30-day notice of termination. A periodic tenancy exists for specified time intervals, such as month to month, which continues for that interval each time the tenant pays rent. A tenant at will has an enforceable lease under Georgia law, even without a written lease agreement.
With regard to assisting buyers and sellers in creating purchase and sale contracts, real estate licensees may be expected to perform which of the following services? A) Prepare contract offers that may result in binding agreements between buyers and sellers B) Help clients draft appropriate language for a special stipulation C) Provide tax and investment strategies for clients in their purchase of a home D) Recommend the best attorney for a client who wants advice on the legal consequences of withdrawing from a contract agreement
Prepare contract offers that may result in binding agreements between buyers and sellers Licensees should, in general, suggest that clients consult appropriate professionals for expert advice in areas beyond the licensees' expertise. However, licensees should use caution in recommending specific advisors.
When the phrase "time is of the essence" is used in a purchase and sale contract form, it is important that all parties to the agreement understand what factor? A) That violations of time-specific performance will terminate the contract B) That parties to the contract must perform within a reasonable time frame C) That the term applies mostly to a financial contingency D) That the term has considerable impact on contract default
That the term has considerable impact on contract default Not adhering to time frames specified in a contract places a party in default. The default does not necessarily terminate the contract. The term means that parties must strictly follow time frames in the contract; the term may apply to any contingency, not primarily to any particular one, such as a contingency on securing a loan.
Which of the following statements is TRUE regarding earnest money in a real estate transaction? A) The earnest money may only be held by an escrow agent in a trust account. B) Without earnest money, the contract lacks sufficient consideration. C) The earnest money may be distributed to the buyer if the contract is not accepted or is not in dispute. D) The escrow agent may only distribute earnest money through a written agreement signed by the parties agreeing on the terms of disbursement.
The earnest money may be distributed to the buyer if the contract is not accepted or is not in dispute.
How do contract forms for the rental of residential property in Georgia generally address renewal of the lease? A) Renewal of leases must follow the guidelines established under the Georgia Residential Landlord-Tenant Act. B) Absent a 60-day termination notice from either party before the end of the rental term, the lease will automatically renew as a tenancy at will. C) The lease may be renewed automatically at the end of the current term, either on a month-to-month basis or for a designated period identified in the lease. D) The tenant and the landlord must enter into a separate renewal agreement at the end of the current lease term.
The lease may be renewed automatically at the end of the current term, either on a month-to-month basis or for a designated period identified in the lease.
Which statement is TRUE about the agency relationship established by the brokerage engagement contract? A) The broker may represent the buyer or the seller as a transaction agent. B) The broker may not act as a dual agent. C) The relationship is one of limited agency between the broker and the client. D) The relationship may only be one of single agency.
The relationship is one of limited agency between the broker and the client. If both clients agree in writing, the broker may be a dual agent, rather than just a single agent. A transaction agent does not represent any party in a transaction, so no brokerage engagement would be created.
T/F: A real property buyer who includes a financial contingency in an offer to purchase and who is denied a loan because of insufficient closing funds would be in default of the contract if that person then terminated the agreement for that reason.
True The financial contingency does not permit a buyer who is denied a loan because of insufficient funds to close the transaction the right to terminate the contract for that reason. Other termination reasons not permitted as a consequence of this contingency include buyer failure to make a timely loan application, buyer inability to sell or lease the current home, or any conduct or action by the purchaser after contract acceptance, but before closing, that causes denial of the loan.
A buyer has prepared an offer to purchase a home. The buyer is concerned about the physical condition of the property and the condition of the surrounding neighborhood. In order to allow the buyer to believe that she has made an appropriate offer on the home, the offer should include A) an appraisal contingency. B) a general right to terminate. C) a financing contingency. D) an inspection contingency.
a general right to terminate.
A residential lease contract in Georgia establishes for the tenant A) a leasehold estate. B) a fee simple estate. C) a limited life estate. D) an estate for years.
a leasehold estate.
One type of compensation that can be stipulated in a seller-broker relationship and a buyer-broker relationship is A) a retainer fee. B) an MLS service fee. C) a seller disclosure processing fee. D) a marketing and property search fee.
a retainer fee.
Broker Ted is meeting with prospective buyer Janice to establish a working relationship. After discussing all the required disclosures, Janice decides to be Ted's customer rather than a client. Ted should require Janice to sign A) a statement acknowledging that she has been informed of the firm's permitted brokerage relationships and that she wants to be treated as a customer. B) a buyer broker agreement with his firm. C) an agreement establishing her as a customer. D) a written agreement acknowledging Ted as a transaction broker.
a statement acknowledging that she has been informed of the firm's permitted brokerage relationships and that she wants to be treated as a customer.
When presenting a CMA to a client, a real estate licensee might BEST describe this document as A) an evaluation of all recently sold properties in a specific market area. B) a modified, noncertified appraisal. C) an analysis that estimates the market value for a particular property. D) a tool to help clients determine a fair market price for listing a property or for a sales price offer.
a tool to help clients determine a fair market price for listing a property or for a sales price offer. Referring to a CMA as an appraisal is a violation of Georgia License Law. An appraisal is defined as an estimation of a property's market value. The CMA only evaluates recently sold properties in the market area that are most similar to the subject property.
A contingency that would protect the buyer from purchasing a property if it does not meet the value required by the lender is A) an appraisal contingency. B) a financing contingency. C) a general right to terminate. D) a survival clause.
an appraisal contingency.
Dispossessory actions taken by a landlord in Georgia with regard to residential leases A) evolve out of common law principles applied to residential leases. B) are regulated by Georgia's landlord and tenant law. C) are governed by the terms of the lease agreement with a tenant. D) are part of the landlord's self-help eviction process.
are regulated by Georgia's landlord and tenant law. This law sets forth the process that landlords must follow to evict tenants. On these matters, the terms of the lease agreement are subject to the statutory act. Self-help eviction is prohibited in Georgia. Common law principles do not dictate the details of this eviction process.
A CMA provides the BEST results in analyzing a property by comparing A) recent sales of similar properties. B) square footage of recent properties. C) net income of similar properties. D) asking prices of expired listings.
recent sales of similar properties.
Special stipulations provided in a residential purchase and sale contract A) always replace printed provisions in the original contract. B) require approval from the purchaser's lender. C) are usually provided on special preprinted forms attached to the contract and provide greater clarity of contract terms or provisions. D) must always be handwritten and initialed by both parties.
are usually provided on special preprinted forms attached to the contract and provide greater clarity of contract terms or provisions.
Under Georgia law, an enforceable real estate contract for purchase and sale must include A) a contingency for a right to terminate the contract. B) at minimum a method to calculate a definite purchase price. C) an earnest money deposit. D) a seller's property condition disclosure.
at minimum a method to calculate a definite purchase price.
Information in a brokerage engagement that is not communicated by the preprinted contractual language and that may change or even eliminate preprinted language in the contract should A) never supersede the intent of the preprinted contractual language. B) be avoided wherever possible. C) be inserted as a special stipulation to the agreement. D) always be added as an amendment to the brokerage agreement.
be inserted as a special stipulation to the agreement.
A property owner signs an exclusive right-to-sell listing agreement for 150 days. Sixty days into the listing, the seller dies in a car accident. Under these circumstances, agency contract forms commonly used in Georgia would MOST likely find the brokerage engagement A) terminated upon the principal's death. B) invalid unless the deceased heirs or the estate agrees to continue the agreement. C) binding on the heirs or the estate of the deceased seller. D) valid only if a contract for sale was in effect at the time of the seller's death.
binding on the heirs or the estate of the deceased seller. Validity of the engagement is unaffected by the seller's death, according to the language in the exclusive right-to-sell agreement. An existing contract for purchase and sale has no impact on the validity of the agreement.
A purchaser's $250,000 offer to buy a property is accepted by the seller, and the purchase and sale contract is signed. During the period specified in an appraisal contingency clause in the contract, an appraisal on the property places a value of $243,000 on the property. In this situation, the A) buyer is obligated to make up the difference of $7,000 in cash. B) lender must offer the buyer a second loan for $7,000. C) buyer has the right to terminate the contract. D) seller is obligated to provide the buyer with a $7,000 loan in addition to the buyer's loan from the lender.
buyer has the right to terminate the contract.
A broker can assist a seller in determining the asking price for a property by preparing a(n) A) price proposal. B) comparative market analysis. C) appraisal. D) listing agreement.
comparative market analysis.
A buyer and a seller are negotiating a contract. The house is vacant. The buyer needs to vacate his home before the closing date established in the contract with the seller. If the seller allows the buyer to occupy the house before the closing date, the presettlement occupancy agreement should contain all of the following elements EXCEPT A) maintenance responsibilities during occupancy. B) the occupancy should not establish a tenancy. C) compensation to the brokers. D) compensation to the seller during occupancy.
compensation to the brokers.
The license law does NOT prohibit real estate licensees from A) completing contract forms prepared by legal counsel. B) advising clients on the consequences of not completing sales contract provisions. C) giving guidance to clients on ways to take title to property. D) consulting with clients on the tax consequences of purchasing properties.
completing contract forms prepared by legal counsel.
The listing agreement between a broker and a seller discusses the possibility of dual agency and designated agency in a transaction by A) disclosing the policy on dual and designated agency and providing a choice to the seller. B) discussing the policy regarding dual agency only. C) discussing the policy regarding designated agency only. D) discussing ministerial acts allowed by the broker.
disclosing the policy on dual and designated agency and providing a choice to the seller.
In Georgia, the right of possession granted by the landlord to the tenant on the day the lease term begins typically A) provides the tenant with a right to cancel the lease if actual possession is not given on that date. B) provides the tenant with a liquidated damage payment from the landlord if possession is not received on that date. C) provides a guarantee of possession on that date to the tenant and holds the landlord in breach of contract if such possession is not given. D) does not guarantee actual possession for the tenant on that day but may offer a prorated rent reduction on a daily basis until possession is received.
does not guarantee actual possession for the tenant on that day but may offer a prorated rent reduction on a daily basis until possession is received. The right of possession granted the tenant, rather than guaranteed actual possession, provides that the lease will remain in force even if the tenant does not gain occupancy on that date. Liquidated damages paid to the tenant by the landlord do not commonly result from a tenant's failure to receive possession on the first day of the lease term.
A tenant's lease has expired. The tenant has moved out of the property and has a $1,500 security deposit held by the landlord. As necessary, the landlord may withhold sums from the security deposit for all of the following EXCEPT A) amounts for repairs. B) delinquent utility bills owed by the tenant. C) escrow agent fees. D) final rent payments.
escrow agent fees.
An option to purchase leased property A) establishes the right of the tenant to purchase a property from the landlord. B) commits the landlord to selling the property at the end of the rental term. C) must be accompanied by a purchase and sale agreement for the property. D) commits the tenant to the purchase of the property at the end of the rental term.
establishes the right of the tenant to purchase a property from the landlord.
Common law in Georgia establishes an estate for years. An estate for years establishes a tenancy for a specific period. This period is typically greater than A) five years. B) three years. C) six years. D) two years.
five years.
In establishing the process for the return of a tenant's security deposit, the language of residential lease contracts in Georgia commonly A) allows landlords to deduct amounts from these funds for any property repairs. B) follows the explicit language found in the state's landlord-tenant code. C) provides a landlord with discretion in returning these funds to a tenant. D) provides for the return of these funds within 60 days from the end of the lease term.
follows the explicit language found in the state's landlord-tenant code.
Under the Georgia Residential Landlord-Tenant Act, a typical residential lease does not establish an estate for years. It establishes a periodic estate. A periodic estate conveys only rights of possession from the landlord to the tenant A) for a particular use within a time frame specified in the contract. B) with no particular time frame. C) for an indefinite period of time. D) for a period greater than five years.
for a particular use within a time frame specified in the contract.
In disputes between landlords and tenants in Georgia, resolutions for the enforcement of either party's rights would MOST likely come A) from judicial interpretations of case law and statutory code. B) through arbitration by the Georgia Real Estate Commission. C) from the Georgia agency that enforces the landlord-tenant statutory code. D) from the Brokerage Relationships in Real Estate Transactions Act.
from judicial interpretations of case law and statutory code. Courts in Georgia look at previous case law and the landlord-tenant code as a basis for rulings in leasing disputes between the parties. No governmental agency in Georgia has the authority to intervene in landlord-tenant disputes. The Real Estate Commission regulates issues involving licensees. BRRETA governs real estate agency law in Georgia.
The exclusive right-to-sell brokerage agreement provides that a broker representing a seller who secures a willing and able purchaser for the property A) may not be entitled to a commission if the property is sold for less than the listing price. B) is entitled to a commission only if the broker, or the broker's affiliates, produces the purchaser. C) is entitled to a commission if the broker, the seller, or any other broker produces a buyer for the property. D) is entitled to a commission only if the seller sells the property when the broker or the broker's affiliates do not produce a buyer.
is entitled to a commission if the broker, the seller, or any other broker produces a buyer for the property.
Broker John sells a property to buyer Alice. After moving in, Alice discovers a structural defect in the house. Alice holds John liable for the defect. This defect is MOST likely a A) defect easily observable by the buyer. B) latent defect. C) condition subsequent. D) normal wear and tear.
latent defect.
A buyer is under contract with a seller. The buyer wishes to terminate the contract because of failure to obtain financing. In order to terminate the contract, the buyer must provide proof that the financing could not be obtained. Such proof should include a letter from the A) buyer agent requesting contract termination. B) lender. C) lender with details of why the loan was denied. D) buyer requesting termination.
lender with details of why the loan was denied.
The buyer's general right to terminate in a residential sales contract A) denies the buyer the right to buy a property "as is." B) must be accepted as written by the seller. C) requires the buyer to close by a date specified in the contract. D) makes the contract conditional on a due diligence period.
makes the contract conditional on a due diligence period.
A person(s) who chooses NOT to sign a brokerage engagement A) must sign a customer election form to work with the broker. B) may still work with an agent in a transactional brokerage relationship. C) may receive no services from the broker. D) may not compensate brokers in a transaction.
may still work with an agent in a transactional brokerage relationship. A transaction agent does not have an agency agreement with any party in the transaction. To work with a broker as a customer, a party would only have to sign a customer election form if that was a policy of the brokerage firm. A customer may still receive ministerial services from a broker. A broker may be compensated by a client or a customer in a transaction.
A Georgia real estate broker engages in a property management agreement with a landlord to manage the landlord's rental properties. The broker collects rent and security deposits. The security deposits A) must be deposited in interest-bearing accounts with interest paid to the landlord. B) may be deposited in a general operating account if the broker manages fewer than 10 units for the landlord. C) are not determined or regulated by Georgia law. D) must be deposited in a trust account registered with the Commission.
must be deposited in a trust account registered with the Commission.
The Georgia Residential Landlord-Tenant Act requires that leases in Georgia A) permit landlords to regain possession of property from a delinquent tenant without any judicial process. B) not limit or weaken landlord responsibility for damages caused by failure to keep the property in good condition. C) exempt landlords from local ordinances. D) include language requiring tenants to pay a landlord's attorney fees.
not limit or weaken landlord responsibility for damages caused by failure to keep the property in good condition.
A landlord has a lease with a tenant who is in default of his lease and in breach of rental payments. The landlord wishes to claim the tenant's personal property. The landlord may only claim the tenant's personal property if he A) performs a self- help eviction. B) obtains an assignment. C) obtains a distraint. D) obtains a court-ordered eviction.
obtains a distraint.
When an inspection report provides that a seller make repairs to his property in a "good and workmanlike manner," it is important for the buyer to A) request that the work be performed only by a licensed contractor. B) provide a detailed list of what specifically is to be addressed, including materials. C) allow the seller to do the work himself. D) only have repairs to those items not indicated as defects.
provide a detailed list of what specifically is to be addressed, including materials.
A brokerage engagement with a seller (a listing agreement) A) provides that any commission promised does not survive the termination of the agreement. B) is one of several agreements defining the relationship between the client and the broker in this particular transaction. C) provides that time is of the essence, requiring punctual performance by the parties. D) is binding only between the seller(s) and the broker and does not survive the death of the seller(s).
provides that time is of the essence, requiring punctual performance by the parties.
A counteroffer might BEST be described as a(n) A) qualified or conditional acceptance. B) an offer that is indefinitely open for acceptance. C) an offer that negatively affects contract negotiation. D) rejection of an existing offer.
rejection of an existing offer. A counteroffer terminates the received offer. Counteroffers are the essential part of contract negotiations. Counteroffers, as most all offers, indicate a specific time frame in which the counteroffer is open for acceptance. A qualified acceptance indicates that the offer received is not fully accepted. A contract is binding once both parties have fully accepted the offer.
The financial contingency clause in a residential purchase contract that refers to the buyer's ability to obtain a loan A) requires the seller to offer seller financing if the buyer cannot obtain a loan. B) requires the buyer to make a good-faith effort to secure a loan. C) must be included in all Georgia residential sales contracts. D) permits the buyer to withdraw from the contract before obtaining a loan.
requires the buyer to make a good-faith effort to secure a loan.
The statute of frauds in Georgia minimizes fraud and abuse in real estate contracts by A) creating a limited time period for the judicial enforcement of contracts. B) only enforcing real estate contracts that are in writing. C) requiring that a purchase and sale agreement for real estate be in writing. D) prohibiting real estate licensees from drafting contracts.
requiring that a purchase and sale agreement for real estate be in writing. The statute of frauds has nothing to do with time limits for enforcement of contracts; that law is called the statute of limitations.
A provision in the purchase and sale contract that would allow a closing to take place even if a term or a condition of the agreement has not been performed by the time of closing is commonly called a A) survival clause. B) special stipulation. C) termination of performance clause. D) contingency clause.
survival clause. If a term or a condition has not been completed before closing, a survival clause permits the parties to conduct the closing, and the uncompleted condition must be performed after closing. Special stipulations and contingency clauses are circumstances that must occur or conditions that must be met for a closing to take place. There is no termination of performance clause in a contract.
A tenant's right to withhold rent as an action taken under constructive eviction will generally be upheld by Georgia courts only if the A) tenant has moved out and shown that the property is unfit for habitability. B) landlord does not allow the tenant who made repairs to deduct that cost from the rent. C) tenant can document how the conditions in the property occupied violates their quiet enjoyment. D) tenant has taken on the costs of repairing the damage to the occupied property.
tenant has moved out and shown that the property is unfit for habitability. Without the tenant voluntarily moving out, constructive eviction may not be enforced. Repairing the property damage and deducting the cost from rent is an action by the tenant but not a part of construction eviction process. Tenants must clearly show that a landlord's lack of action has made property unfit to live in and that it is not just a violation of the proper living comfort promised in the landlord's covenant of quiet enjoyment.
A broker enters into an exclusive buyer brokerage relationship with a prospective purchaser who must sell a current house in order to move to a new property. Due to that agreement, the broker may be required to disclose to a seller all of the following EXCEPT A) whether the buyer intends to occupy the property. B) if the buyer is currently under contract to purchase another property. C) the prospective buyer's financial ability to purchase the property under terms acceptable to the seller. D) the buyer's personal reasons for selling her existing residence.
the buyer's personal reasons for selling her existing residence.
In a brokerage engagement, a client would be obligated to disclose to the broker that A) the floor in the sun room of the home the broker will list is beginning to slope. B) the roof of the home the broker will list has shingles that are cracking. C) paint is peeling off the ceiling in the kitchen of the home the broker will list. D) the client will be leasing out the single-family home being purchased.
the client will be leasing out the single-family home being purchased. This is information that the broker will need to disclose to the seller of the property because it is a material fact for that customer/party. The other three items of information are all physical conditions that a purchaser could discover through a reasonable inspection of the property. Therefore, they would not be classified as latent physical defects.
A landlord and a tenant have agreed to a lease contract. The property is to be made available for occupancy within five days of the lease being signed. If the property is not ready for occupancy after the fifth day, the lease will remain in force. All of the following options are available to the tenant EXCEPT A) the tenant may cancel the lease and be reimbursed for rent. B) the landlord may cancel the lease and return the security deposit to the tenant. C) the tenant may cancel the lease and be reimbursed any security deposit. D) the rent can be reduced proportionate to the occupancy date.
the landlord may cancel the lease and return the security deposit to the tenant.
In completing a brokerage engagement agreement with a seller, the property description may be any of the following EXCEPT A) specific reference to a deed book and page number in county courthouse records. B) the street, city, and zip code of the property. C) short-form legal description. D) a metes-and-bounds description.
the street, city, and zip code of the property.
In an exclusive right-to-sell brokerage agreement, the client and the broker agree to A) hold the broker liable for providing false information to the public even if it is unknown to the broker. B) treat all third-party customers honestly. C) disregard the knowledge of latent defects. D) treat all parties honestly.
treat all third-party customers honestly.
Under Georgia law, a tenant may vacate a property and suspend rental payments under the following conditions EXCEPT A) when the landlord refuses to make repairs to the property, making the property uninhabitable. B) when the tenant can show that the property is uncomfortable to live in. C) when the tenant can show that the landlord has allowed the property to become uninhabitable. D) when the property cannot be restored within a reasonable period for making repairs to create a habitable condition.
when the tenant can show that the property is uncomfortable to live in. The tenant may vacate the property and suspend payments only if the property is uninhabitable. The property being uncomfortable to live in is not a serious enough condition to release the tenant from obligations under a lease.
