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Law of Contracts – Practice Test

May 15, 2017 Leave a Comment Written by MrBeeToe

Law of Contracts – Practice Test

Welcome to your Law of Contracts - Practice Test

The TREC residential contract forms are:
Under the Deceptive Trade Practices Act, __________ are defined as tangible chattels.
If a seller will continue to occupy the property for one month after the closing, the buyer and seller should:
A Seller's Disclosure Notice is not required:
If a seller's agent notices that his sellers failed to disclose and then cover up a roof leak, he/she should:
If a seller's agent notices that his sellers failed to disclose and then cover up a roof leak, what are some ways that the agent can handle this issue to minimize the resist of liability for him and his broker?
The type of law that deals with the relationship between the parties to a transaction, sales agents and brokers is:
__________ is the body of laws and regulations enacted by federal and state legislative bodies.
Any man-made addition to land that is permanent, and is considered to become part of the land is known as a(n) _____________.
A(n) _________ is an entity created for the benefit of another.
An option contract is:
___________ is not a requirement of a valid contract.
If a person has been judged to be incompetent, a contract is _________ because the person never had the capacity to enter into a contract in the first place.
The five essential elements of a valid and enforceable contract are, Consideration, Offer and Acceptance, Legal purpose, In writing and _________.
A(n) _________ is an agreement between two or more parties to do something or to refrain from doing something.
When an individual owns real property, he or she is said to have a(n) _______ in that property.
If property violates zoning, the owners must request a ______________, which is permission to violate the rules.
A(n) ___________ is an area of land separating one land use from another.
The French term ___________ means a life estate that is based on the life of another.
In a residential lease with a "right of first refusal" provision:
A ___________ is an employment agreement between the seller and the broker.
Prior to closing, severe damage to or destruction of a property under contract:
The four major types of listing agreements are, exclusive agency, net listing, exclusive right to sell and _________.
In a _______ lease, the tenant's rent is based, in whole or in part, on the receipts of his or her business.
A(n) __________ is a type of seller financing wherein the owner retains title to the property while the purchaser takes possession of the premises and pays on the principal.
A counteroffer is:
A seller choosing to receive a buyer's earnest money after the buyer defaults on a contract is an example of:
The Special Provisions paragraph of the contract allows license holders to insert:
An offer by a prospective purchaser can be terminated prior to acceptance due to:
A seller decides to stop allowing showings on his home and is ready to compare the five written offers he has received. If his agent receives two more last minute offers, one written and one verbal, which of the offers should the agent present to the seller?
A seller decides to stop allowing showings on his home and is ready to compare the five written offers he has received. If his agent receives two more last minute offers, one written and one verbal, what should the agent do to look out for his customer's best interest?
A seller decides to stop allowing showings on his home and is ready to compare the five written offers he has received. If his agent receives two more last minute offers, one written and one verbal, how can the agent help the seller evaluate offers?
A seller decides to stop allowing showings on his home and is ready to compare the five written offers he has received. If his agent receives two more last minute offers, one written and one verbal, what options does the seller have when responding to the offers?
The closing date specified in a contract is usually a(n) "__________" date.
A(n) __________ to a contract is an attachment that adds or further describes the rights and duties of the parties.
The Lead-Based Paint Disclosure is:
An agent submitted an offer for his buyer with an attached Third Party Financing Addendum that makes the contract contingent on obtaining financing for full asking price. If the offer is accepted, but the buyer learns that the lender will finance $10,000 less than she needs, she has the following options available except:
An agent submitted an offer for hes buyer with an attached Third Party Financing Addendum that makes the contract contingent on obtaining financing for full asking price. If the offer is accepted, but the buyer learns that the lender will finance $10,000 less than she needs, what should the listing agent do to make sure she is fulfilling her fiduciary responsibilities to her client?
An agent submitted an offer for his buyer with an attached Third Party Financing Addendum that makes the contract contingent on obtaining financing for full asking price. The offer is accepted, but the buyer learns that the lender will finance $10,000 less than she needs. What additional amendments, contingencies, or addenda may be used if the buyer and the seller decide to proceed with the sale at a lower sales price?
Texas Veteran's Housing Assistance Program loans can be:
The least common form of mortgage financing is:
The __________ is the percentage of the lesser of the appraised value or sales price that the lender will loan.
If the loan factor is $5.53 on a $200,000 loan, taxes are $2,400/year and insurance is $1,800/year, what is the monthly PITI payment?
A __________ is a pledge of real estate as security for the repayment of a debt.
A written history of all instruments and happenings that may affect title is called:
When the title history of a parcel of land has been researched back to the original conveyance by the government, the history is said to go back to the _________.
_______ occurs when an individual dies, leaving no valid will.
__________ is the process by which a lender exercises its power of sale under a mortgage that is in default.
A(n) ___________ description of property is a requirement for a valid deed.
___________ occurs when an individual acquires title from the rightful owner through hostile, actual, and continuous occupation of the land for the statutory period.
RESPA regulates closings on:
_________ of RESPA prohibits any person who, pursuant to any agreement or understanding, gives or receives a fee or a thing of value for the referral of settlement business.
_______ implements the Real Estate Settlement Procedures Act.
Rule P-53 of the Texas Department of Insurance states that Title Companies:
Ongoing expenses such as property taxes and property owner association feeds that are divided between the buyer and the seller at closing are called __________.
A yearly tax bill is $2,400 and has not been paid. The property has sold and closing is July 30th. How much will be owed at closing for taxes? (Use a 365 day year, round to the nearest dollar and the seller pays for closing day.)
If a buyer's agent needs to deliver the option fee for a contract that has been executed, would it be a good idea for the agent to drop off the option fee at the title company? Why or why not?
If a buyer's agent needs to deliver the option fee by no later than Saturday, for a contract that has been executed, which of the  following statements about the option fee is TRUE?
A buyer's agent needs to deliver the option fee by no later than Saturday, for a contract that has been executed. He delivers the check on the Sunday after, and the buyers then decide on Monday that they want to exercise their right to terminate the contract because the home inspection revealed that the roof will likely need some repairs. What potential problem do the buyers face?
The buyer and seller on a transaction decide to extend the option period, so the potential buyers can get some repair estimates on issues found during an inspection. The seller also agrees that he will lower his asking price by the amount of the roof repairs. The buyer's agent notes the new option period and the agreement to lower the sales price in Paragraph 11, the Special Provisions section of the sales contract. Did he handle this situation correctly?

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