Texas Law of Contracts – Cumulative
EXAM QUESTIONS WITH CORRECT
SOLUTIONS||UPDATED 2026/2027
SYLLABUS||100% GUARANTEED
PASS||ALREADY GRADED
A+||<<LATEST VERSION>>
malfunction - ANSWER ✓ when something is designed or built to perform a
certain function and no longer does so
market value - ANSWER ✓ the price for which a property will sell if offered
openly under normal conditions
mechanic's lien - ANSWER ✓ a lien that establishes a claim against a property to
secure payment for labor or materials used to improve that property
mortgage lien - ANSWER ✓ a lien on property that was purchased with money
borrowed from a lender
mutual agreement - ANSWER ✓ a means of cancelling a contract in which all
parties agree to the cancelation
negotiable instrument - ANSWER ✓ a transferable, written promise by a party to
pay a specific amount of money
net lease - ANSWER ✓ a lease in which the tenant pays a base rent rate plus all or
part of the operating expenses
non-judicial foreclosure - ANSWER ✓ a foreclosure that does not involve a suit or
ruling of the court — the two types are power-of-sale foreclosures and strict
foreclosures
, offer and acceptance - ANSWER ✓ the mutual agreement of all parties to consent
to all terms contained within the contract and to perform according to those terms
option - ANSWER ✓ an agreement that gives one party the right to perform a
non-obligatory action within a time period (ex: terminating a contract or the right
of first refusal)
option period - ANSWER ✓ the window of time during which a buyer can opt out
of a contract without penalty; a right that is purchased by the buyer
ownership interest - ANSWER ✓ an undisputed right of an owner to their property
partial performance - ANSWER ✓ when one or more of the contracting parties
perform only a portion of the agreed-upon contractual duties
partnership - ANSWER ✓ a business entity legally formed for two or more
individuals to share profits
percentage lease - ANSWER ✓ a commercial lease in which the tenant pays a
base rent amount and a percentage of their business profits to the landlord
performance agreement - ANSWER ✓ part of a contract that requires the
contracting parties either to perform certain actions or to uphold certain contractual
promises
periodic estate - ANSWER ✓ has a fixed lease period, meaning that the lease is
automatically renewed at the end of each lease period until the landlord or tenant
acts to terminate it; also known as periodic tenancy
personal property - ANSWER ✓ any moveable, unattached property that is not
real property; also known as chattel or personalty
police power - ANSWER ✓ right of the state to regulate and restrict land-use in
order to protect the public, including enforcing zoning and building codes
power of attorney - ANSWER ✓ a legal document conferring the right for one
individual to act on behalf of another
, power-of-sale clause - ANSWER ✓ gives lenders the ability to post property for
foreclosure if the debtor is behind on payments
principle of supply and demand - ANSWER ✓ the existing inventory of a
commodity, product, or service available and the desire of consumers for it; factors
that combine to influence price
private land-use controls - ANSWER ✓ land-use controls that are put into place
by non-governmental entities, such as real estate developers
promissory estoppel - ANSWER ✓ a legal doctrine that forces a party to keep a
promise and prevents a party from backing out of an agreement
promissory note - ANSWER ✓ also known just as a note, it's a document in which
the borrower acknowledges their debt and promises to repay the holder of the
promissory note
promulgated contracts - ANSWER ✓ contracts promoted by the Texas Real Estate
Commission and required for use by all real estate sales agents when completing
the transaction for which the contract was created
proration - ANSWER ✓ the act of dividing or allocating expenses between buyers
and sellers based on the actual period of usage of the item or service
public land-use controls - ANSWER ✓ government-issued land-use controls such
as zoning ordinances, subdivision regulations, and building codes
public ownership of land - ANSWER ✓ the role of government to own and
maintain public land such as streets, highways, and parks
pur autre vie - ANSWER ✓ a life estate characterized by ownership lasting only
for the duration of a designated party's lifetime
real estate - ANSWER ✓ a part of the surface of land to the center of the earth and
upward to space, plus all improvements made by man or nature
remainderman - ANSWER ✓ the recipient of the remainder — either the grantor
who set up the life estate or a designated third party
EXAM QUESTIONS WITH CORRECT
SOLUTIONS||UPDATED 2026/2027
SYLLABUS||100% GUARANTEED
PASS||ALREADY GRADED
A+||<<LATEST VERSION>>
malfunction - ANSWER ✓ when something is designed or built to perform a
certain function and no longer does so
market value - ANSWER ✓ the price for which a property will sell if offered
openly under normal conditions
mechanic's lien - ANSWER ✓ a lien that establishes a claim against a property to
secure payment for labor or materials used to improve that property
mortgage lien - ANSWER ✓ a lien on property that was purchased with money
borrowed from a lender
mutual agreement - ANSWER ✓ a means of cancelling a contract in which all
parties agree to the cancelation
negotiable instrument - ANSWER ✓ a transferable, written promise by a party to
pay a specific amount of money
net lease - ANSWER ✓ a lease in which the tenant pays a base rent rate plus all or
part of the operating expenses
non-judicial foreclosure - ANSWER ✓ a foreclosure that does not involve a suit or
ruling of the court — the two types are power-of-sale foreclosures and strict
foreclosures
, offer and acceptance - ANSWER ✓ the mutual agreement of all parties to consent
to all terms contained within the contract and to perform according to those terms
option - ANSWER ✓ an agreement that gives one party the right to perform a
non-obligatory action within a time period (ex: terminating a contract or the right
of first refusal)
option period - ANSWER ✓ the window of time during which a buyer can opt out
of a contract without penalty; a right that is purchased by the buyer
ownership interest - ANSWER ✓ an undisputed right of an owner to their property
partial performance - ANSWER ✓ when one or more of the contracting parties
perform only a portion of the agreed-upon contractual duties
partnership - ANSWER ✓ a business entity legally formed for two or more
individuals to share profits
percentage lease - ANSWER ✓ a commercial lease in which the tenant pays a
base rent amount and a percentage of their business profits to the landlord
performance agreement - ANSWER ✓ part of a contract that requires the
contracting parties either to perform certain actions or to uphold certain contractual
promises
periodic estate - ANSWER ✓ has a fixed lease period, meaning that the lease is
automatically renewed at the end of each lease period until the landlord or tenant
acts to terminate it; also known as periodic tenancy
personal property - ANSWER ✓ any moveable, unattached property that is not
real property; also known as chattel or personalty
police power - ANSWER ✓ right of the state to regulate and restrict land-use in
order to protect the public, including enforcing zoning and building codes
power of attorney - ANSWER ✓ a legal document conferring the right for one
individual to act on behalf of another
, power-of-sale clause - ANSWER ✓ gives lenders the ability to post property for
foreclosure if the debtor is behind on payments
principle of supply and demand - ANSWER ✓ the existing inventory of a
commodity, product, or service available and the desire of consumers for it; factors
that combine to influence price
private land-use controls - ANSWER ✓ land-use controls that are put into place
by non-governmental entities, such as real estate developers
promissory estoppel - ANSWER ✓ a legal doctrine that forces a party to keep a
promise and prevents a party from backing out of an agreement
promissory note - ANSWER ✓ also known just as a note, it's a document in which
the borrower acknowledges their debt and promises to repay the holder of the
promissory note
promulgated contracts - ANSWER ✓ contracts promoted by the Texas Real Estate
Commission and required for use by all real estate sales agents when completing
the transaction for which the contract was created
proration - ANSWER ✓ the act of dividing or allocating expenses between buyers
and sellers based on the actual period of usage of the item or service
public land-use controls - ANSWER ✓ government-issued land-use controls such
as zoning ordinances, subdivision regulations, and building codes
public ownership of land - ANSWER ✓ the role of government to own and
maintain public land such as streets, highways, and parks
pur autre vie - ANSWER ✓ a life estate characterized by ownership lasting only
for the duration of a designated party's lifetime
real estate - ANSWER ✓ a part of the surface of land to the center of the earth and
upward to space, plus all improvements made by man or nature
remainderman - ANSWER ✓ the recipient of the remainder — either the grantor
who set up the life estate or a designated third party
