VA BILLBOARD SIGN CONTRACTING
EXAMPREP TEST PAPER 2026
◉ Terminate within one year. Answer: A lease that will terminate
within one year of its inception: need not be written.
A contract does not always need to be in writing—the basic
elements of contract formation may be satisfied orally. Contracts for
the sale of real estate and leases for longer than one (1) year must
be written (cannot be oral) due to the statute of frauds.
◉ "Buyer's Due Diligence". Answer: What does "Buyer's Due
Diligence" in a property lease purchase agreement typically involve?
The tenant's responsibility for due diligence, including home
inspections and appraisals.
"Buyer's Due Diligence" in a lease purchase agreement outlines the
tenant's responsibility for due diligence, which may include home
inspections, appraisals, and assessments before exercising the
purchase option.
◉ Contract is breached. Answer: When a contract is breached, the
injured party may: Rescind the contract unilaterally.
,A breach justifies rescission by the non-defaulting party. However,
parties must be careful to ensure that there actually is a breach, or
the rescission itself will be a breach. A contract may not be rescinded
if the parties cannot be returned to their pre-contract positions.
Specific performance is an available remedy for breach of a sales
agreement because real estate is unique, such that monetary
damages may be insufficient to remedy a breach. However, specific
performance is not available for other contracts, such as the breach
of an agency agreement or other personal service contracts.
Liquidated damages are available to a non-breaching party when so
indicated in a contract, so there would be no reason to file suit.
◉ Lease purchase agreement. Answer: Chip has been renting a 2
bedroom house from Dale for over four years. Dale offers to sell the
house to Chip but chip does not have enough money saved for a
down payment on a mortgage. What type of agreement could help
Chip and Dale in this situation? Lease purchase agreement
If a tenant wants to purchase the landlord's property, but cannot do
so immediately (cannot qualify for loan or does not have enough
down payment), the parties can enter into a lease-purchase
agreement which contains both lease terms and purchase contract
terms. They agree on a purchase price and purchase date to occur at
an agreeable future date. In the interim, part of the tenant's rent
each month is applied to the purchase price.
Net and open listing agreements are for the sale of homes but would
not help Chip in this situation since he does not have enough money
to put down on a regular home loan.
,◉ "mailbox rule". Answer: Regarding offer acceptance, what is the
"mailbox rule" ? Rule stating if an acceptance is mailed it is effective
when it is deposited in the mailbox by the offeree.
Where acceptance is properly submitted by mail, the law states that
the acceptance becomes effective when it is deposited into a
mailbox, and not when it is actually received by the offeror. Other
forms of acceptance (oral, written) do not become binding on the
offeror until they are actually received.
◉ The sales contract. Answer: Which of the following contracts will
provide instruction for the distribution and proration of escrow and
impound funds? The sales contract
The settlement agent will examine various documents to ascertain
how to distribute funds. Of the choices, the sales contract will come
closest to containing all pertinent information about disbursements.
◉ Specific performance. Answer: After closing, a young couple
moves into their newly purchased home. They notice that the living
and dining room draperies have been removed, despite being
specifically included in the ratified sales contract. What can the
buyers do? -Nothing, if the cost to sue would be more than the cost
of the drapes
-Sue the seller for specific performance
, If the parties agreed that the draperies would transfer with the
property, then the seller's removal of the draperies is a breach of the
sales contract. The buyer COULD sue for specific performance or do
nothing. A mechanic's lien does not apply to this situation.
◉ Valid. Answer: Under the statute of frauds, an oral listing is: Valid
A listing is an agency agreement for a broker to perform services
(sell a house). A listing is not a contract for the sale of land or
transferring an interest in land (a lease). Therefore, a listing need
not be written under the statute of frauds. Note that some states
may require listings to be written under state license laws
(applicable only to the State Portion of the exam). However, the
question addresses the statute of frauds, not state license laws.
◉ Offer terminate. Answer: Vernon presents an offer to a seller, with
the provision that it must be accepted within 72 hours. Under which
of the following circumstances would the offer terminate?
If Vernon dies before the seller accepts the offer, the offer
terminates. Re-submitting an offer with a different settlement date
and proposing to wait a week before acceptance are both
counteroffers. Counteroffers are new offers that terminate the
original offer.
EXAMPREP TEST PAPER 2026
◉ Terminate within one year. Answer: A lease that will terminate
within one year of its inception: need not be written.
A contract does not always need to be in writing—the basic
elements of contract formation may be satisfied orally. Contracts for
the sale of real estate and leases for longer than one (1) year must
be written (cannot be oral) due to the statute of frauds.
◉ "Buyer's Due Diligence". Answer: What does "Buyer's Due
Diligence" in a property lease purchase agreement typically involve?
The tenant's responsibility for due diligence, including home
inspections and appraisals.
"Buyer's Due Diligence" in a lease purchase agreement outlines the
tenant's responsibility for due diligence, which may include home
inspections, appraisals, and assessments before exercising the
purchase option.
◉ Contract is breached. Answer: When a contract is breached, the
injured party may: Rescind the contract unilaterally.
,A breach justifies rescission by the non-defaulting party. However,
parties must be careful to ensure that there actually is a breach, or
the rescission itself will be a breach. A contract may not be rescinded
if the parties cannot be returned to their pre-contract positions.
Specific performance is an available remedy for breach of a sales
agreement because real estate is unique, such that monetary
damages may be insufficient to remedy a breach. However, specific
performance is not available for other contracts, such as the breach
of an agency agreement or other personal service contracts.
Liquidated damages are available to a non-breaching party when so
indicated in a contract, so there would be no reason to file suit.
◉ Lease purchase agreement. Answer: Chip has been renting a 2
bedroom house from Dale for over four years. Dale offers to sell the
house to Chip but chip does not have enough money saved for a
down payment on a mortgage. What type of agreement could help
Chip and Dale in this situation? Lease purchase agreement
If a tenant wants to purchase the landlord's property, but cannot do
so immediately (cannot qualify for loan or does not have enough
down payment), the parties can enter into a lease-purchase
agreement which contains both lease terms and purchase contract
terms. They agree on a purchase price and purchase date to occur at
an agreeable future date. In the interim, part of the tenant's rent
each month is applied to the purchase price.
Net and open listing agreements are for the sale of homes but would
not help Chip in this situation since he does not have enough money
to put down on a regular home loan.
,◉ "mailbox rule". Answer: Regarding offer acceptance, what is the
"mailbox rule" ? Rule stating if an acceptance is mailed it is effective
when it is deposited in the mailbox by the offeree.
Where acceptance is properly submitted by mail, the law states that
the acceptance becomes effective when it is deposited into a
mailbox, and not when it is actually received by the offeror. Other
forms of acceptance (oral, written) do not become binding on the
offeror until they are actually received.
◉ The sales contract. Answer: Which of the following contracts will
provide instruction for the distribution and proration of escrow and
impound funds? The sales contract
The settlement agent will examine various documents to ascertain
how to distribute funds. Of the choices, the sales contract will come
closest to containing all pertinent information about disbursements.
◉ Specific performance. Answer: After closing, a young couple
moves into their newly purchased home. They notice that the living
and dining room draperies have been removed, despite being
specifically included in the ratified sales contract. What can the
buyers do? -Nothing, if the cost to sue would be more than the cost
of the drapes
-Sue the seller for specific performance
, If the parties agreed that the draperies would transfer with the
property, then the seller's removal of the draperies is a breach of the
sales contract. The buyer COULD sue for specific performance or do
nothing. A mechanic's lien does not apply to this situation.
◉ Valid. Answer: Under the statute of frauds, an oral listing is: Valid
A listing is an agency agreement for a broker to perform services
(sell a house). A listing is not a contract for the sale of land or
transferring an interest in land (a lease). Therefore, a listing need
not be written under the statute of frauds. Note that some states
may require listings to be written under state license laws
(applicable only to the State Portion of the exam). However, the
question addresses the statute of frauds, not state license laws.
◉ Offer terminate. Answer: Vernon presents an offer to a seller, with
the provision that it must be accepted within 72 hours. Under which
of the following circumstances would the offer terminate?
If Vernon dies before the seller accepts the offer, the offer
terminates. Re-submitting an offer with a different settlement date
and proposing to wait a week before acceptance are both
counteroffers. Counteroffers are new offers that terminate the
original offer.
