CHAMPIONS PROMULGATED CONTRACT FORMS TEST
EXAM-ACTUAL EXAM-LATEST UPDATE 2025| COMPLETE
QUESTIONS WITH CORRECT DETAILED AND VERIFIED
ANSWERS| RATED 100% CORRECT!! GUARANTEED PASS!! |
ALREADY GRADED A+
One to Four Family Residential Contract (Resale) - (answers)The promulgated contract used by
real estate licensees for the sale of residential property. It's used when purchasing residential real
estate, but variations of forms are available for other types of real property.
Residential Condominium (Resale) - (answers)A TREC promulgated contract for use where the
seller does not own fee simple title to the land beneath the unit.
New Home Contract (Completed Construction) - (answers)This contract form is used for new
homes where the construction has been completed by the builder and no one has previously lived
in the home.
New Home Contract (Incomplete Construction) - (answers)The contract is used for the sale of new
homes when construction has not yet been completed by the builder and when the closing will
occur after construction has been completed.
Unimproved Property Contract - (answers)Used for the sale of properties with no existing
structure. This contract has no improvements, or accessories. No seller disclosure.
Farm and Ranch Contract - (answers)A TREC promulgated contract for use where the land being
sold is greater than 10 acres and includes land, improvements, accessories and crops. Contains
provisions for surface leases related to a property
The parties to the contract specifically as noted in paragraph 18.A - (answers)The escrow agent is
not a party to this contract and does not have liability for the performance or non-performance of
any part of this contract, or liable for any interest or loss on any earnest money cause by the failure
of any financial institution.
,The purpose and use of Paragraph 6- - (answers)The owner's Title policy being paid for by buyer
or seller. The Title company has 20 days from when they receive the contract to furnish a
commitment to buyer for Title Insurance. Objections, who will furnish the survey, the intended
use of the property (residential use) and any membership in property associations.
Stigmatized properties - (answers)Any property where there has been a murder, alleged haunting,
or in the vicinity of the residence of a known sexual offender
The unlawful practice of law - (answers)License holders should not alter the pre-printed text of a
promulgated form. Specific examples - agents add provisions to contracts other than business
details: Example: Inserting terms into a contract when a TREC promulgated form is available.
Adding terms into a contract that are not addressed by a TREC promulgated form.
Items to be retained by the seller as specified in the contract - (answers)any items retained should
be written in Paragraph 2D. EXCLUSIONS.
PARAGRAPH 5 features - (answers)Earnest Money and Option periods. The option period is the
time allowed for inspections that Buyer may want. The buyer is required to deposit the earnest
money with the escrow agent within 3 calendar days after the effective date of the contract.
Requirements for buyer approval according to the TREC Third Party Financing Addendum -
(answers)allows the buyer to terminate the transaction if the property doesn't meet the lender's
underwriting requirements.
Closing Costs or settlement expenses - (answers)if any of these listed expenses exceed what the
party agreed to pay, the contract will terminate, UNLESS the other party agrees to pay the excess
Proration - (answers)Dividing property taxes, hazard insurance and other expenses or income
between the buyer and seller, as of date of settlement.
Required use of TREC forms and exceptions to required use - (answers)when the licensee is acting
as a principal and not as an agent.
,One of the exceptions for when a licensee must use a TREC-promulgated contract form is in
transactions in which the licensee is functioning solely as a principal, not as an agent.
Valid Contract - (answers)An agreement that meets the requirements of law.
Void Contract - (answers)An agreement that is invalid from the beginning and does not affect the
parties
Executory Contract - (answers)A contract that has been signed by the parties, but not yet carried
out. (It's the sales contract before closing or contract for deed)
Fully Executed - (answers)A contract is fully executed when all parties have performed.
Use of third-party financing addendum - (answers)Allows the buyer to terminate the transaction if
the property doesn't meet the lender's underwriting requirements. It is divided into two broad
categories: government loans and conventional loans.
Requirements of a valid contract- - (answers)Consideration, Offer and Acceptance, Legal Purpose,
In writing, Competent parties
When does an offer become a contract? - (answers)When it is accepted and the acceptance is
communicated.
PARAGRAPH 8.A - (answers)is closure of agency coupled with an interest and family
relationships - TX law requires a RE broker or sales agent who is a party to a transaction or acting
on behalf of a spouse, parent, child, business entity in which the broker or sales agent owns more
than 10%, or if acting as a trustee to a trust, or beneficiary, to notify the other party in writing
before entering into a contract of sale.
Paragraph 23- use and timing - (answers)Option period with a negotiable length of time. The buyer
can walk away for any reason within this time.
, Lead Paint - disclosures, dates, timing, buyer's rights, seller's responsibilities - (answers)If the
property was built prior to 1978, the required Lead-Based Paint Addendum must accompany the
contract. The seller must disclose this info, the buyer has the right to decline inspection.
TREC Form RSC‐2 - (answers)this disclosure form is required to be provided if a license holder
receives any form of compensation from a residential service company. That compensation can
not be contingent upon a party to the real estate transaction purchasing a contract or services from
the residential service company. The compensation is the fee for the services that Listing Broker
or Other Broker, either directly or through an agent, provides to the company.
Fair Housing and Prohibited Acts - (answers)Prohibits Discrimination based on race, color,
religion, national origin, Sex (added in 1974), familial status, and disability. Prohibits steering,
and blockbusting.
The T-47 affidavit - (answers)a document from a notary who saw the owner of the property sign
this document. The owner is making a sworn statement. When using the seller's existing survey,
the seller is given a number of days to deliver the survey and a _________________ to the Buyer
and the title company.
Loan Assumption - (answers)When the buyer assumes and agrees to pay the seller's existing
mortgage. A addendum is required to be filled out.
Promulgated Loan Forms - (answers)A Third Party Addendum to state what type of financing the
buyer will use. Conventional or govt loan. If loan approval is not done, then contract will terminate
and earnest money will be refunded to buyer.
Features of the Lead Based Paint disclosure form - (answers)Seller's disclosure of the presence of
this, records and reports available to seller, the buyer's rights to waive the inspection or get an
inspection, and buyer's acknowledgement.
Paragraph 20 - Federal Tax Requirements - (answers)If seller is a "foreign person" or if seller fails
to deliver an affidavit or a certificate of non-foreign status to Buyer, then buyer shall withhold
from the sales proceeds an amount sufficient to comply with applicable tax law and deliver the
same to the IRS together with appropriate tax forms.
EXAM-ACTUAL EXAM-LATEST UPDATE 2025| COMPLETE
QUESTIONS WITH CORRECT DETAILED AND VERIFIED
ANSWERS| RATED 100% CORRECT!! GUARANTEED PASS!! |
ALREADY GRADED A+
One to Four Family Residential Contract (Resale) - (answers)The promulgated contract used by
real estate licensees for the sale of residential property. It's used when purchasing residential real
estate, but variations of forms are available for other types of real property.
Residential Condominium (Resale) - (answers)A TREC promulgated contract for use where the
seller does not own fee simple title to the land beneath the unit.
New Home Contract (Completed Construction) - (answers)This contract form is used for new
homes where the construction has been completed by the builder and no one has previously lived
in the home.
New Home Contract (Incomplete Construction) - (answers)The contract is used for the sale of new
homes when construction has not yet been completed by the builder and when the closing will
occur after construction has been completed.
Unimproved Property Contract - (answers)Used for the sale of properties with no existing
structure. This contract has no improvements, or accessories. No seller disclosure.
Farm and Ranch Contract - (answers)A TREC promulgated contract for use where the land being
sold is greater than 10 acres and includes land, improvements, accessories and crops. Contains
provisions for surface leases related to a property
The parties to the contract specifically as noted in paragraph 18.A - (answers)The escrow agent is
not a party to this contract and does not have liability for the performance or non-performance of
any part of this contract, or liable for any interest or loss on any earnest money cause by the failure
of any financial institution.
,The purpose and use of Paragraph 6- - (answers)The owner's Title policy being paid for by buyer
or seller. The Title company has 20 days from when they receive the contract to furnish a
commitment to buyer for Title Insurance. Objections, who will furnish the survey, the intended
use of the property (residential use) and any membership in property associations.
Stigmatized properties - (answers)Any property where there has been a murder, alleged haunting,
or in the vicinity of the residence of a known sexual offender
The unlawful practice of law - (answers)License holders should not alter the pre-printed text of a
promulgated form. Specific examples - agents add provisions to contracts other than business
details: Example: Inserting terms into a contract when a TREC promulgated form is available.
Adding terms into a contract that are not addressed by a TREC promulgated form.
Items to be retained by the seller as specified in the contract - (answers)any items retained should
be written in Paragraph 2D. EXCLUSIONS.
PARAGRAPH 5 features - (answers)Earnest Money and Option periods. The option period is the
time allowed for inspections that Buyer may want. The buyer is required to deposit the earnest
money with the escrow agent within 3 calendar days after the effective date of the contract.
Requirements for buyer approval according to the TREC Third Party Financing Addendum -
(answers)allows the buyer to terminate the transaction if the property doesn't meet the lender's
underwriting requirements.
Closing Costs or settlement expenses - (answers)if any of these listed expenses exceed what the
party agreed to pay, the contract will terminate, UNLESS the other party agrees to pay the excess
Proration - (answers)Dividing property taxes, hazard insurance and other expenses or income
between the buyer and seller, as of date of settlement.
Required use of TREC forms and exceptions to required use - (answers)when the licensee is acting
as a principal and not as an agent.
,One of the exceptions for when a licensee must use a TREC-promulgated contract form is in
transactions in which the licensee is functioning solely as a principal, not as an agent.
Valid Contract - (answers)An agreement that meets the requirements of law.
Void Contract - (answers)An agreement that is invalid from the beginning and does not affect the
parties
Executory Contract - (answers)A contract that has been signed by the parties, but not yet carried
out. (It's the sales contract before closing or contract for deed)
Fully Executed - (answers)A contract is fully executed when all parties have performed.
Use of third-party financing addendum - (answers)Allows the buyer to terminate the transaction if
the property doesn't meet the lender's underwriting requirements. It is divided into two broad
categories: government loans and conventional loans.
Requirements of a valid contract- - (answers)Consideration, Offer and Acceptance, Legal Purpose,
In writing, Competent parties
When does an offer become a contract? - (answers)When it is accepted and the acceptance is
communicated.
PARAGRAPH 8.A - (answers)is closure of agency coupled with an interest and family
relationships - TX law requires a RE broker or sales agent who is a party to a transaction or acting
on behalf of a spouse, parent, child, business entity in which the broker or sales agent owns more
than 10%, or if acting as a trustee to a trust, or beneficiary, to notify the other party in writing
before entering into a contract of sale.
Paragraph 23- use and timing - (answers)Option period with a negotiable length of time. The buyer
can walk away for any reason within this time.
, Lead Paint - disclosures, dates, timing, buyer's rights, seller's responsibilities - (answers)If the
property was built prior to 1978, the required Lead-Based Paint Addendum must accompany the
contract. The seller must disclose this info, the buyer has the right to decline inspection.
TREC Form RSC‐2 - (answers)this disclosure form is required to be provided if a license holder
receives any form of compensation from a residential service company. That compensation can
not be contingent upon a party to the real estate transaction purchasing a contract or services from
the residential service company. The compensation is the fee for the services that Listing Broker
or Other Broker, either directly or through an agent, provides to the company.
Fair Housing and Prohibited Acts - (answers)Prohibits Discrimination based on race, color,
religion, national origin, Sex (added in 1974), familial status, and disability. Prohibits steering,
and blockbusting.
The T-47 affidavit - (answers)a document from a notary who saw the owner of the property sign
this document. The owner is making a sworn statement. When using the seller's existing survey,
the seller is given a number of days to deliver the survey and a _________________ to the Buyer
and the title company.
Loan Assumption - (answers)When the buyer assumes and agrees to pay the seller's existing
mortgage. A addendum is required to be filled out.
Promulgated Loan Forms - (answers)A Third Party Addendum to state what type of financing the
buyer will use. Conventional or govt loan. If loan approval is not done, then contract will terminate
and earnest money will be refunded to buyer.
Features of the Lead Based Paint disclosure form - (answers)Seller's disclosure of the presence of
this, records and reports available to seller, the buyer's rights to waive the inspection or get an
inspection, and buyer's acknowledgement.
Paragraph 20 - Federal Tax Requirements - (answers)If seller is a "foreign person" or if seller fails
to deliver an affidavit or a certificate of non-foreign status to Buyer, then buyer shall withhold
from the sales proceeds an amount sufficient to comply with applicable tax law and deliver the
same to the IRS together with appropriate tax forms.
