Final Exam Study - Promulgated Forms(Law of contracts
II)Solved 100% Correct!!
1. The effective date- who, what, and when?
Between the buyer and the seller, The date on which the communication was made.
The date of initialing and signing of the parties. The last party to initial/Sign fills in the
day.
2. What is the legal proceedings brought by party to a contract against another
party to compel action call forth in the agreement?
Breach of a contract, one-party defaults, sues for specific performance, seek other relief
- arbitration, mediation, injunction to sue for compensatory Damages.
3. If the seller fails to provide the buyer with the sellers disclosure of property
condition as required by Section 5.008 of the Texas property code what is the
status of the purchase contract?
Voidable - The buyer may terminate the contract anytime prior to closing and the
earnest money will be refunded to the buyer.
4. Which of the following is not addressed by TRAC - promulgated contracts.
Lease purchase
new Condocontract
1. Transactions with the licensee is functioning Soley as the principal, not as an agent.
2. Transactions in which an agency of the United States government requires a different
form to be used.
3. Transactions for which a contract form has been prepared by property owner or
prepared by an attorney and required by the property owner.
4. Transactions for which most standard contract form has been promulgated by the
Texas real estate commission, and the licensee uses a form prepared by the attorney at
law licensed by this state and approved by the attorney for a particular kind of
transaction involved or prepared by the Texas real estate Broker - lawyer committee
and made available for trial use By licensees with the consent of the commission.
5. When is a financing addendum not required?
When the buyer pays in cash.
Wiave third financing addendum
6. Items that are preprinted in paragraphs 1 and 2 of the contract include all the
following except?
Exclusions
7. When will the third party financing addendum credit approval not be used?
1. Buyer pays cash.
2. Seller financing.,
8. Which addenda will the Purchaser use when purchasing a property for cash?
None- no addendum will be used.
9. Which addendum is commonly used in a transaction involving a 90 percent
fixed rate loan with PMI?
Third party financing addendum.
, 10. What form is used if the buyer wants the seller to leave the refrigerator with
the home after closing?
Non-- Reality items addendum
11. In Third party financing addendum for credit approval, what should the On
interest rates?
MARKET RATE-----
Should be on what the buyer and lender have agreed on and it should not exceed that
amount.
12. Federal law dictates that an addendum addressing the possible presence of
lead-based paint and lead based paint hazard be attached to the purchase
agreement when the house is being so that was built before?
Prior to 1978.
13. Earnest money is to be deposited?
By the end of the 2nd business day after the effective date. days of the effective date of
the contract.
14. If the seller furnishes the existing survey to the buyer, but it is not acceptable
to the buyers lender, the cost of the new survey may be at whose expense?
The buyer.- 6c-1
15. Which form is used for the owner to tell the buyer about known problems with
the property?
Sellers disclosure of property condition.
16. The notice about obtaining an abstract or title policy is a required notice
from?
Buyer's broker.
17. When I licensees using a builders contract or you won't prepared by attorney
that is not promulgated by
TREC, what is the wisest way to notify the buyer about title insurance or
abstract.?
Notice to prospective buyer - Suggest that he get an abstract or a title insurance prior to
closing
18. Which of the following is not true about
about paragraph 11 special provisions?
Paragraph 11 special provisions calls for:
Insert only factual statements and business details to the sale. TREC prohibits licensee
from adding factual statements for business detail where to contract addendum lease or
other form has been promulgated by TREC for mandatory use.
19. Which of the following is true about TREC addenda?
It adds to the contract but does not change the contract.
20. Which is acceptable language for special provisions of 22-TREC contract
form?
Only factual or business details.
21. Can a party accept earnest money as liquidated damages and also sue the
third party for specific performance
No - one or the other.
22. Regarding closing and the buyer's possession of the property?
II)Solved 100% Correct!!
1. The effective date- who, what, and when?
Between the buyer and the seller, The date on which the communication was made.
The date of initialing and signing of the parties. The last party to initial/Sign fills in the
day.
2. What is the legal proceedings brought by party to a contract against another
party to compel action call forth in the agreement?
Breach of a contract, one-party defaults, sues for specific performance, seek other relief
- arbitration, mediation, injunction to sue for compensatory Damages.
3. If the seller fails to provide the buyer with the sellers disclosure of property
condition as required by Section 5.008 of the Texas property code what is the
status of the purchase contract?
Voidable - The buyer may terminate the contract anytime prior to closing and the
earnest money will be refunded to the buyer.
4. Which of the following is not addressed by TRAC - promulgated contracts.
Lease purchase
new Condocontract
1. Transactions with the licensee is functioning Soley as the principal, not as an agent.
2. Transactions in which an agency of the United States government requires a different
form to be used.
3. Transactions for which a contract form has been prepared by property owner or
prepared by an attorney and required by the property owner.
4. Transactions for which most standard contract form has been promulgated by the
Texas real estate commission, and the licensee uses a form prepared by the attorney at
law licensed by this state and approved by the attorney for a particular kind of
transaction involved or prepared by the Texas real estate Broker - lawyer committee
and made available for trial use By licensees with the consent of the commission.
5. When is a financing addendum not required?
When the buyer pays in cash.
Wiave third financing addendum
6. Items that are preprinted in paragraphs 1 and 2 of the contract include all the
following except?
Exclusions
7. When will the third party financing addendum credit approval not be used?
1. Buyer pays cash.
2. Seller financing.,
8. Which addenda will the Purchaser use when purchasing a property for cash?
None- no addendum will be used.
9. Which addendum is commonly used in a transaction involving a 90 percent
fixed rate loan with PMI?
Third party financing addendum.
, 10. What form is used if the buyer wants the seller to leave the refrigerator with
the home after closing?
Non-- Reality items addendum
11. In Third party financing addendum for credit approval, what should the On
interest rates?
MARKET RATE-----
Should be on what the buyer and lender have agreed on and it should not exceed that
amount.
12. Federal law dictates that an addendum addressing the possible presence of
lead-based paint and lead based paint hazard be attached to the purchase
agreement when the house is being so that was built before?
Prior to 1978.
13. Earnest money is to be deposited?
By the end of the 2nd business day after the effective date. days of the effective date of
the contract.
14. If the seller furnishes the existing survey to the buyer, but it is not acceptable
to the buyers lender, the cost of the new survey may be at whose expense?
The buyer.- 6c-1
15. Which form is used for the owner to tell the buyer about known problems with
the property?
Sellers disclosure of property condition.
16. The notice about obtaining an abstract or title policy is a required notice
from?
Buyer's broker.
17. When I licensees using a builders contract or you won't prepared by attorney
that is not promulgated by
TREC, what is the wisest way to notify the buyer about title insurance or
abstract.?
Notice to prospective buyer - Suggest that he get an abstract or a title insurance prior to
closing
18. Which of the following is not true about
about paragraph 11 special provisions?
Paragraph 11 special provisions calls for:
Insert only factual statements and business details to the sale. TREC prohibits licensee
from adding factual statements for business detail where to contract addendum lease or
other form has been promulgated by TREC for mandatory use.
19. Which of the following is true about TREC addenda?
It adds to the contract but does not change the contract.
20. Which is acceptable language for special provisions of 22-TREC contract
form?
Only factual or business details.
21. Can a party accept earnest money as liquidated damages and also sue the
third party for specific performance
No - one or the other.
22. Regarding closing and the buyer's possession of the property?
