Real estate promulgated contract forms practice test-solved

Essential elements of a contract include - Answer- All of the above A contract must include all of these items except - Answer- Type of loan If a Seller counters a Buyer's offer, it is considered a rejection - Answer- True It is considered illegal for a contract to include any discriminatory provisions - Answer- True The biggest majority of lawsuits come from the issue of - Answer- Non-disclosure You can give legal advice to a buyer or seller if you understand all the facts - Answer- False A Seller, age 30, enters into a contract with a Buyer, age 17. The contract is - Answer- Voidable by the buyer A bilateral contract is - Answer- A promise in exchange for a promise A unilateral contract only binds one party to perform - Answer- True The clause in a contract stating that "time is of the essence" would indicate - Answer- Strict performance of a certain act within the time stated in the contract If there is no time limit specified in an offer, then the time limit will expire - Answer- Within a reasonable time An agent must provide the Information About Brokerage Services (IBS) notice at the time of the first substantive dialogue with the party to the transaction for all of the following EXCEPT - Answer- Leasing a residential property for a term of six months An agent must provide Information About Brokerage Services even if the party is already under contract to purchase the property - Answer- False An agent is required by law to cover the agency relationships described in the Information About Brokerage Services - Answer- True An Agent must represent someone in a transaction. Therefore, if they do not represent the Buyer or Tenant through an expressed agreement, they are, by default, representing the Owner - Answer- True Which one of the following, with written consent, may act as an Intermediary? - Answer- The Broker representing the seller and buyer For a Broker to act as Intermediary in a transaction, it requires written consent from only one of the parties. - Answer- False An expressed agency cannot be orally agreed but must be in writing - Answer- False Implied agency is created by the actions of the agent - Answer- True The Texas Association of Realtors (TAR) Residential Buyer/Tenant Representation Agreement allows all the following EXCEPT: - Answer- The term of the agreement can automatically renew If a buyer elects 8-B (No Intermediary Status), in the Residential Buyer/Tenant Representation Agreement, the client will - Answer- Not be shown any of the broker's listings If a bonus is offered by an owner or an owner's agent, the Buyer's broker: - Answer- May retain the additional compensation The Buyer/Tenant Representation Agreement must always be signed by the agent's sponsoring broker - Answer- False The TREC-promulgated Seller Financing Addendum states that if a Seller determines at Seller's sole discretion that the buyer's credit is unacceptable, the Seller may terminate the contract and return the earnest money to the buyer - Answer- True A Municipal Utility District (MUD) is a political subdivision of the State of Texas authorized by the Texas Water Code to provide ______________ and other services within the MUD boundaries - Answer- All of the above In paragraph 2 of the standard residential contract form, which of the following items would NOT be included in the sale, unless otherwise provided for? - Answer- Oriental living room rug The Seller must notify the Buyer to have the abstract of title examined by an attorney or obtain a policy of title insurance - Answer- False Paragraph 4 (Financing) in the 1-4 Family Residential Contract is also used for cash transactions - Answer- False In a contract to purchase real property, what is the name of the clause that states that the buyer will NOT be held responsible to complete the purchase if the buyer cannot obtain sufficient financing? - Answer- Contingency clause When completing the finance portion of the contract, the number of days you select to get the buyer's loan approved should not exceed - Answer- The closing date Attachments required in a Resale Certificate for Property Subject to Mandatory Membership in an Owner's Association include - Answer- All of the above If Paragraph 4(B) is checked under the Financing Paragraph, the following are true EXCEPT: - Answer- The Buyer has the right to terminate and have earnest money refunded if they cannot obtain a loan FHA loans are government insured. VA loans are guaranteed by the governme - Answer- True There are no promulgated forms for a lease for temporary occupancy for a buyer prior to closing. - Answer- False Why do lender-required repairs take priority? - Answer- Because the buyer cannot get the loan without these being done Per paragraph 9 (Closing), what type of deed is called for in a standard residential sale? - Answer- General warranty deed The "Special Provisions" paragraph (#11) of the Residential Contract is for - Answer- Inserting factual statements and business details where no addendum is required All the following fees will be prorated at closing EXCEPT - Answer- Credit report fees Regarding mediation—the Buyer and Seller are obligated under the terms of the Residential Contract to abide by the ruling of the mediator - Answer- False It is required by law that a seller disclose any information they have regarding their property. They may use any form or notice that they wish - Answer- True Under Property Condition (Paragraph 7), if a buyer checks item 7D(1) accepting the property in its present condition - Answer- None of the above If a Buyer checks item 7D(2) under Property Condition, the Buyer can only ask for specific repairs, and cannot use general terms such as "subject to inspection." - Answer- True Your buyers are considering consulting their attorney while you are preparing the offer. You should - Answer- Offer to deliver the contract to their attorney The "effective date" of the contract is: - Answer- When the last person signs and initials all changes During the option period in the 1-4 Family Residential Contract (resale), the Buyer has the unrestricted right to terminate the contract if