REAL ESTATE CONTRACTS EXAMS SCRIPT 2026/2027
QUESTIONS AND SOLUTIONS RATED A+
✔✔Implied Contract - ✔✔The agreement of the parties is demonstrated by their acts or
conduct.
✔✔Land Contract - ✔✔A document wherein the lender (usually the seller) retains title to
the property until the debt is paid. It is also referred to as an installment sales contract
or an agreement of sale.
✔✔Liquidated Damages - ✔✔An agreement between the parties that in the event of a
breach, the amount of damages shall be liquidated (set or fixed). The amount is set
before the breach, usually at the time of making the contract.
✔✔Novation - ✔✔The substitution of a new party or a new obligation in a contract. This
process requires the agreement of all original parties in the contract, but once it has
been agreed to, the original obligatee, or liable party, is released from liability.
✔✔Offer and Acceptance - ✔✔The person who makes the offer is the offeror. The
person to whom the offer is made is the offeree. Agreeing to the terms of an offer to
enter into a contract, thereby creating a binding contract.
✔✔Option - ✔✔A contract wherein a seller agrees to sell property for a set amount at
specified terms, if the buyer chooses to exercise that right to purchase during the
contracted period of time. In return for the seller taking his property off the market, the
buyer pays valuable, non-refundable consideration.
✔✔Owner Financing - ✔✔A loan agreement between the seller and the buyer for all or
a portion of the purchase price of real property.
✔✔Rescission - ✔✔The unmaking of a contract, and the restoring of each party to the
same position each held before the contract was created.
✔✔Statute of Frauds - ✔✔The requirement that certain contracts must be in writing in
order to be enforceable in court.
✔✔Suit For Specific Performance - ✔✔The buyer ask the court to force the seller to go
through with the sale and transfer the property as previously agreed.
✔✔"Time is of the essence" - ✔✔A phrase in a contract that requires the performance
of a certain act within a stated period of time.
✔✔Unenforceable Contract - ✔✔Incapable of being enforced by the court of law.
QUESTIONS AND SOLUTIONS RATED A+
✔✔Implied Contract - ✔✔The agreement of the parties is demonstrated by their acts or
conduct.
✔✔Land Contract - ✔✔A document wherein the lender (usually the seller) retains title to
the property until the debt is paid. It is also referred to as an installment sales contract
or an agreement of sale.
✔✔Liquidated Damages - ✔✔An agreement between the parties that in the event of a
breach, the amount of damages shall be liquidated (set or fixed). The amount is set
before the breach, usually at the time of making the contract.
✔✔Novation - ✔✔The substitution of a new party or a new obligation in a contract. This
process requires the agreement of all original parties in the contract, but once it has
been agreed to, the original obligatee, or liable party, is released from liability.
✔✔Offer and Acceptance - ✔✔The person who makes the offer is the offeror. The
person to whom the offer is made is the offeree. Agreeing to the terms of an offer to
enter into a contract, thereby creating a binding contract.
✔✔Option - ✔✔A contract wherein a seller agrees to sell property for a set amount at
specified terms, if the buyer chooses to exercise that right to purchase during the
contracted period of time. In return for the seller taking his property off the market, the
buyer pays valuable, non-refundable consideration.
✔✔Owner Financing - ✔✔A loan agreement between the seller and the buyer for all or
a portion of the purchase price of real property.
✔✔Rescission - ✔✔The unmaking of a contract, and the restoring of each party to the
same position each held before the contract was created.
✔✔Statute of Frauds - ✔✔The requirement that certain contracts must be in writing in
order to be enforceable in court.
✔✔Suit For Specific Performance - ✔✔The buyer ask the court to force the seller to go
through with the sale and transfer the property as previously agreed.
✔✔"Time is of the essence" - ✔✔A phrase in a contract that requires the performance
of a certain act within a stated period of time.
✔✔Unenforceable Contract - ✔✔Incapable of being enforced by the court of law.
