Texas Law of Contracts Exam Study Guide: Questions &
Answers
A buyer makes an offer, the seller wants to accept the offer if the buyer will agree to a change in price. In
these circumstances, the seller will give the buyer a - ANSWER:Counteroffer
What law requires certain types of contracts to be enforceable? - ANSWER:Statute of Frauds
the buyer and the seller have agreed that the seller will remove a huge birdbath in the backyard before
the buyer takes possession of the property. This agreement should be - ANSWER:Addresses in the sales
contract
Which method of providing legal description uses north-south and east-west lines to describe the
location of the property? - ANSWER:Rectangular government survey system
When a contract is unenforceable because it does not fulfill the statutory requirements it is -
ANSWER:Void
Which of the following is TRUE regarding earnest money? - ANSWER:It serves as a remedy of default
Suit for specific performance is an action one party can take in the event of - ANSWER:Breach of contract
by the other party
Which of the following is TRUE about TREC-promulgated contract forms? - ANSWER:They must be used
by real estate license holders in all transactions to which the forms are applicable unless one of four
exceptions apply
The sales contract says the buyer will purchase only if the buyers current home closes within the next 30
days. This is called - ANSWER:Contingency
A buyer purchases a home under a land contract. until the contract is paid in full, the buyer -
ANSWER:Has equitable title in the property
What is the certificate of eligibility for? - ANSWER:VA Loans
All of the following is required for FHA except - ANSWER:Certificate for eligibility
If the seller accepts an offer, can they later claim that they were in un-due duress? - ANSWER:Yes, and it
would void the contract
The Borrower under a deed of trust is called the? - ANSWER:Trustor
Reverse mortgage means? - ANSWER:Reverse mortgage means that house DOES NOT have to be payed
of, be a certain age 62-65, the bank is paying you, instead of you paying the bank. The bank will take over
the house, but they can not make you move in the state of Texas.
Regulation Z - ANSWER:Truth in Lending (TILA)requires you to disclose; discount points, loan origination
fee, and interest rates.
Answers
A buyer makes an offer, the seller wants to accept the offer if the buyer will agree to a change in price. In
these circumstances, the seller will give the buyer a - ANSWER:Counteroffer
What law requires certain types of contracts to be enforceable? - ANSWER:Statute of Frauds
the buyer and the seller have agreed that the seller will remove a huge birdbath in the backyard before
the buyer takes possession of the property. This agreement should be - ANSWER:Addresses in the sales
contract
Which method of providing legal description uses north-south and east-west lines to describe the
location of the property? - ANSWER:Rectangular government survey system
When a contract is unenforceable because it does not fulfill the statutory requirements it is -
ANSWER:Void
Which of the following is TRUE regarding earnest money? - ANSWER:It serves as a remedy of default
Suit for specific performance is an action one party can take in the event of - ANSWER:Breach of contract
by the other party
Which of the following is TRUE about TREC-promulgated contract forms? - ANSWER:They must be used
by real estate license holders in all transactions to which the forms are applicable unless one of four
exceptions apply
The sales contract says the buyer will purchase only if the buyers current home closes within the next 30
days. This is called - ANSWER:Contingency
A buyer purchases a home under a land contract. until the contract is paid in full, the buyer -
ANSWER:Has equitable title in the property
What is the certificate of eligibility for? - ANSWER:VA Loans
All of the following is required for FHA except - ANSWER:Certificate for eligibility
If the seller accepts an offer, can they later claim that they were in un-due duress? - ANSWER:Yes, and it
would void the contract
The Borrower under a deed of trust is called the? - ANSWER:Trustor
Reverse mortgage means? - ANSWER:Reverse mortgage means that house DOES NOT have to be payed
of, be a certain age 62-65, the bank is paying you, instead of you paying the bank. The bank will take over
the house, but they can not make you move in the state of Texas.
Regulation Z - ANSWER:Truth in Lending (TILA)requires you to disclose; discount points, loan origination
fee, and interest rates.
