Law of contracts practice test Exam Questions AND Correct
Answers
A breach of contract occurs when: - ✔✔terms or conditions of
a contract are violated and a party does not perform
A buyer and seller are parties to a sales contract. The buyer
makes several payments before the seller rescinds the
contract. The seller must: - ✔✔return all payments they
received from the buyer
A buyer decides to terminate the contract during his option
period. He will submit the Termination of Contract notice to
the seller and will be entitled to: - ✔✔A refund of earnest
money
A buyer who needs to ensure they are able to sell their old
home before committing to the purchase of a new home
should: - ✔✔Include the promulgated addendum with the
contract
A buyer's offer is returned with two changes made. The
proposed contract is now a(n): - ✔✔counteroffer
,A CLO: - ✔✔helps consumers find a lender, fill out an
application, and get loan approval all from their computer
A conventional loan: - ✔✔is not guaranteed or insured by any
government agency
A financing contingency clause requires that: - ✔✔the buyer
get approved for a loan before being able to complete the
purchase of a home
A general inspector will inspect WHAT but not WHAT? - ✔✔A
general inspector will inspect accessible systems but not
anything buried or hidden.
A home is about to be sold but is condemned before closing
day. The sales contract is discharged by operation of law.
Operation of law occurs when: - ✔✔a contract is not legally
valid or becomes unenforceable due to a statute of frauds, a
statute of limitations, or other legal regulations
A home is about to be sold but is condemned before closing
day. The sales contract is discharged by operation of law.
Operation of law occurs when:* - ✔✔a contract is not legally
,valid or becomes unenforceable due to a statute of frauds, a
statute of limitations, or other legal regulations
A home mortgage is an example of: - ✔✔a specific and
voluntary lien
A homeowner who has given notice of title by recording their
property deed is protected against: - ✔✔future claims of
interest in their property
A homeowner who has given notice of title by recording their
property deed is protected against:* - ✔✔future claims of
interest in their property
A license holder can have their license suspended or revoked
if: - ✔✔they failed to use a contract form required by TREC.
A license holder cannot legally do anything regarding real
estate for a commission or a fee if: - ✔✔their license is
suspended
, A license holder cannot legally do anything regarding real
estate for a commission or a fee if:* - ✔✔their license is
suspended
A license holder may have his or her license suspended or
revoked for all of the following EXCEPT: - ✔✔The license
holder fails to perform an unlawful act requested by a client
A promissory note is: - ✔✔the borrower's personal promise to
repay the loan to the lender
A quitclaim deed carries: - ✔✔no covenants, guarantees or
warranties
A sale and leaseback agreement is: - ✔✔a way for landowners
to free up capital while maintaining the same overhead
expenses
A sale and leaseback agreement is:* - ✔✔a way for
landowners to free up capital while maintaining the same
overhead expenses
Answers
A breach of contract occurs when: - ✔✔terms or conditions of
a contract are violated and a party does not perform
A buyer and seller are parties to a sales contract. The buyer
makes several payments before the seller rescinds the
contract. The seller must: - ✔✔return all payments they
received from the buyer
A buyer decides to terminate the contract during his option
period. He will submit the Termination of Contract notice to
the seller and will be entitled to: - ✔✔A refund of earnest
money
A buyer who needs to ensure they are able to sell their old
home before committing to the purchase of a new home
should: - ✔✔Include the promulgated addendum with the
contract
A buyer's offer is returned with two changes made. The
proposed contract is now a(n): - ✔✔counteroffer
,A CLO: - ✔✔helps consumers find a lender, fill out an
application, and get loan approval all from their computer
A conventional loan: - ✔✔is not guaranteed or insured by any
government agency
A financing contingency clause requires that: - ✔✔the buyer
get approved for a loan before being able to complete the
purchase of a home
A general inspector will inspect WHAT but not WHAT? - ✔✔A
general inspector will inspect accessible systems but not
anything buried or hidden.
A home is about to be sold but is condemned before closing
day. The sales contract is discharged by operation of law.
Operation of law occurs when: - ✔✔a contract is not legally
valid or becomes unenforceable due to a statute of frauds, a
statute of limitations, or other legal regulations
A home is about to be sold but is condemned before closing
day. The sales contract is discharged by operation of law.
Operation of law occurs when:* - ✔✔a contract is not legally
,valid or becomes unenforceable due to a statute of frauds, a
statute of limitations, or other legal regulations
A home mortgage is an example of: - ✔✔a specific and
voluntary lien
A homeowner who has given notice of title by recording their
property deed is protected against: - ✔✔future claims of
interest in their property
A homeowner who has given notice of title by recording their
property deed is protected against:* - ✔✔future claims of
interest in their property
A license holder can have their license suspended or revoked
if: - ✔✔they failed to use a contract form required by TREC.
A license holder cannot legally do anything regarding real
estate for a commission or a fee if: - ✔✔their license is
suspended
, A license holder cannot legally do anything regarding real
estate for a commission or a fee if:* - ✔✔their license is
suspended
A license holder may have his or her license suspended or
revoked for all of the following EXCEPT: - ✔✔The license
holder fails to perform an unlawful act requested by a client
A promissory note is: - ✔✔the borrower's personal promise to
repay the loan to the lender
A quitclaim deed carries: - ✔✔no covenants, guarantees or
warranties
A sale and leaseback agreement is: - ✔✔a way for landowners
to free up capital while maintaining the same overhead
expenses
A sale and leaseback agreement is:* - ✔✔a way for
landowners to free up capital while maintaining the same
overhead expenses
