Real Estate Practice Exam Chapters 1-11
Questions And Answers.
Listing agreement - Answer broker's employment contract with a seller. Seller must be given a
copy within 24 hours.
Includes:
A definite expiration date
Identification of the property
Price and terms
Fee or commission
Signature(s) of the owner(s)
Buyer brokerage agreement - Answer A buyer brokerage agreement is an employment
contract with a buyer
Agreements include:
The parties to and term of the agreement (beginning and ending dates)
General characteristics of the property being sought by the buyer, including type of property,
price range, and location
Broker's obligations
Buyer's obligations
Retainer and compensation (either as a dollar amount or a percentage of purchase price)
Protection period
Early termination of the agreement and dispute resolution (buyer and broker agree to mediate
first)
Authorized brokerage relationship
Sale and purchase contract - Answer A sale and purchase contract is a contract between a
buyer and seller
Option contract - Answer an agreement to keep open for a specified period of time an offer to
sell or lease real property
,A contract must have: - Answer Competent parties
Offer and acceptance (mutual assent)
Legal purpose
Consideration
Real Estate Contracts must also be:
In writing and signed
voidable - Answer contracts with minors are voidable
mutual assent - Answer refers to the making and acceptance of an offer. The parties must
come to a meeting of the minds, meaning they must reach an agreement on all terms in the
contract
Valuable consideration - Answer the money or a promise of something that can be measured
in terms of money
Good consideration - Answer a promise that cannot be measured in terms of money, such as
love and affection
statute of frauds - Answer requires that contracts conveying an interest in real property, and
contracts that are not to be performed within one year of the date created, must be in writing
and signed to be enforceable
contracts covered by the statute of frauds include - Answer Purchase and sale contracts
Option contracts
Deeds and mortgage instruments
Lease agreements for a term longer than one year
Listing agreements for a term longer than one year
statute of limitations - Answer Written contracts—five years
Oral contracts—four years
, parol contract - Answer an informal, oral contract
executory contract - Answer not yet a fully performed contract
executed contract - Answer When all parties to a contract have completely performed all the
obligations and promises contained in the contract
An offer is terminated when any of the following happens - Answer counteroffer
acceptance
rejection
withdrawal by offeror
lapse of time
death or insanity
destruction of property
A contract is terminated when any of the following happens - Answer performance
mutual rescission: both parties agree to termination
impossiblity of performance
lapse of time
bankruptcy
breach
Remedies for breach of contract - Answer Specific performance (relief in equity): the court
orders the other party to perform according to the contract.
Liquidated damages: previously stipulated amount to be paid in case of default (usually earnest
money)
Rescission: cancelation of contract
Compensatory damages: involves a lawsuit to recover the actual monetary loss
Questions And Answers.
Listing agreement - Answer broker's employment contract with a seller. Seller must be given a
copy within 24 hours.
Includes:
A definite expiration date
Identification of the property
Price and terms
Fee or commission
Signature(s) of the owner(s)
Buyer brokerage agreement - Answer A buyer brokerage agreement is an employment
contract with a buyer
Agreements include:
The parties to and term of the agreement (beginning and ending dates)
General characteristics of the property being sought by the buyer, including type of property,
price range, and location
Broker's obligations
Buyer's obligations
Retainer and compensation (either as a dollar amount or a percentage of purchase price)
Protection period
Early termination of the agreement and dispute resolution (buyer and broker agree to mediate
first)
Authorized brokerage relationship
Sale and purchase contract - Answer A sale and purchase contract is a contract between a
buyer and seller
Option contract - Answer an agreement to keep open for a specified period of time an offer to
sell or lease real property
,A contract must have: - Answer Competent parties
Offer and acceptance (mutual assent)
Legal purpose
Consideration
Real Estate Contracts must also be:
In writing and signed
voidable - Answer contracts with minors are voidable
mutual assent - Answer refers to the making and acceptance of an offer. The parties must
come to a meeting of the minds, meaning they must reach an agreement on all terms in the
contract
Valuable consideration - Answer the money or a promise of something that can be measured
in terms of money
Good consideration - Answer a promise that cannot be measured in terms of money, such as
love and affection
statute of frauds - Answer requires that contracts conveying an interest in real property, and
contracts that are not to be performed within one year of the date created, must be in writing
and signed to be enforceable
contracts covered by the statute of frauds include - Answer Purchase and sale contracts
Option contracts
Deeds and mortgage instruments
Lease agreements for a term longer than one year
Listing agreements for a term longer than one year
statute of limitations - Answer Written contracts—five years
Oral contracts—four years
, parol contract - Answer an informal, oral contract
executory contract - Answer not yet a fully performed contract
executed contract - Answer When all parties to a contract have completely performed all the
obligations and promises contained in the contract
An offer is terminated when any of the following happens - Answer counteroffer
acceptance
rejection
withdrawal by offeror
lapse of time
death or insanity
destruction of property
A contract is terminated when any of the following happens - Answer performance
mutual rescission: both parties agree to termination
impossiblity of performance
lapse of time
bankruptcy
breach
Remedies for breach of contract - Answer Specific performance (relief in equity): the court
orders the other party to perform according to the contract.
Liquidated damages: previously stipulated amount to be paid in case of default (usually earnest
money)
Rescission: cancelation of contract
Compensatory damages: involves a lawsuit to recover the actual monetary loss
