Promulgated Contracts Exam Questions and Verified Answers Latest Update 2024 Already Passed

Promulgated Contracts Exam Questions and Verified Answers Latest Update 2024 Already Passed Contract: - Answers A legally binding and enforceable agreement to do or not to do a specific thing Promulgated Contract: - Answers A contract that has been approved and is required to be used by license holders In Texas, what are the two entities that promulgate contracts? - Answers TREC and TAR In a real estate sale, the license holder must use the appropriate TREC-promulgated form UNLESS another contract form is required by the buyer's lender. - Answers FALSE (Explanation: In a real estate sale, the license holder must use the appropriate TREC-promulgated form UNLESS another contract form is required by the property owner. The buyer's lender has no influence over the sales contracts used in a transaction.) A license holder should ___________. - Answers disclose all material facts to the client Legally Competent: - Answers When an individual has reached the age of majority (18 years of age) and has not been declared mentally incompetent by a judge Void Contract: - Answers A contract that has no legal effect Voidable Contract: - Answers When one or more of the parties has the authority to rescind the contract Consideration: - Answers A valuable item that each party exchanges in order to demonstrate that they agree to the contract terms Which of the following is TRUE of mutual agreement? - Answers There cannot be mistakes in the terms and conditions All of the following are essential elements of a valid contract EXCEPT: - Answers earnest money What is NOT an element of a valid contract? - Answers earnest money A law that requires real estate contracts to be in writing is the ______. - Answers statute of Frauds Valid Contract: - Answers Legal agreement meeting all the essential, basic requirements of the law Unenforceable Contract: - Answers A contract that cannot be enforced by the courts 5 essential elements of a valid contract: - Answers 1.Mutual assent (100% agreement) 2.Legally competent parties (18, sane, and sober) 3.Consideration (an exchange of something of value) 4.Lawful objective (the purpose of the contract must be legal) 5.In writing (a written and signed offer and acceptance) If two people have a contract for one to sell illegal drugs to the other, the contract would be: - Answers Void A contract that cannot be enforced by the courts is _____. - Answers unenforceable Executory Contract: - Answers A contract that is not completely executed or performed Executed Contract: - Answers A contract in which all terms have been fulfilled by all parties A contract that is "pending" is __________________. - Answers executory The difference between an executory contract and an executed contract is that the executed contract is _____. - Answers closed The best way for any contract to terminate is to become _________________. - Answers executed According to Texas state law, a contract for deed and a lease with an option to buy are considered ___________. - Answers executory contracts Bilateral Contract: - Answers A contract in which one party must promise to do something for another party and that party must promise to do something for the first party Unilateral Contract: - Answers A contract made between two or more parties in which only one of those parties makes a promise or otherwise accepts an obligation An option to buy contract is a(n)_________________. - Answers Unilateral Contract Which of the following is a bilateral contract? - Answers leases If a contract says "time is of the essence," that means that it is due: - Answers as soon as possible By whom should the language "time of the essence" be added? - Answers an attorney Addenda: - Answers Materials added to and included in the initial contract that provide more information on the transaction Amendment: - Answers Items that are attached to the original document and should never be changed after the document has been signed and accepted When filling out the nine checkable box options on the Amendment to Contract form, more than one box can be checked. - Answers TRUE In which situation would an amendment go into effect? - Answers the parties sign to amendment TREC promulgated addenda are added to the contract AFTER it has been signed. - Answers FALSE (Explanation: Addenda are added to the contract BEFORE the contract has been signed. Amendments are added afterwards.) Performance: - Answers The responsibility of all the parties to carry out their part of a contract Quitclaim Deed: - Answers Transfers ownership of whatever the grantor owns but make no guarantee of ownership and no promise to defend Novation: - Answers The substitution of a new contract for an existing contract, relieves the original party of liability Obligations often times must be completed within a certain number of days of _____. - Answers the effective date If one of the parties defaults and the non-defaulting party accepts the earnest money as damages, they may also: - Answers Do nothing more, as the contract is terminated. To transfer contract obligations without necessarily relieving the original party from obligations, you need a(n) __________. - Answers assignment Statute of Limitation: - Answers A law establishing a time limit for civil suits The Doctrine of Laches is the same thing as the Statutes of Limitations. - Answers FALSE (Explanation: The Doctrine of Laches is based on common law, while Statutes of Limitations are written and codified.) One-Year Limitation Period: - Answers Malicious prosecution, libel, slander, or breach of promise of marriage not later than one year after the day the cause of action accrues Two-Year Limitation Period: - Answers Trespass for injury to the estate or to the property of another, conversion of personal property, taking or detaining the personal property of another, personal injury, forcible entry and detainer, and forcible detainer not later than two years after the day the cause of action accrues Four-Year Limitation Period: - Answers Specific performance of a contract for the conveyance of real property, penalty or damages on the penal clause of a bond to convey real property, debt, fraud, or breach of fiduciary duty