Texas Promulgated Contract Forms Exam Questions with Complete Solutions

1. The TREC promulgated contract forms: - Answer- Are drafted by the Broker-Lawyer Committee 2. In a lease with "right of first refusal" provision: - Answer- The tenant has the right to match or better any offer the landlord receives to prevent the property from being sold to someone else 3. TREC promulgated forms for: - Answer- Residential transactions 4. TREC promulgated contract forms provide for: - Answer- -Third party financing -Assumption -Seller finance 5. A lender can withdraw the approval of the property: - Answer- At any time prior to closing 6. The Third Party Financing Addendum For Credit Approval is used when: - Answer- If paragraph 4.A(2)(a) is checked in the contract 7. A new survey is always required for all transactions. - Answer- FALSE 8. The number of days allowed for objections to title or survey is: - Answer- The number of days entered in paragraph 6 9. TREC promulgated contracts allow the buyer to have the property inspected: - Answer- By inspectors licensed by TREC or otherwise permitted by law 10. When a buyer defaults on a contract and the seller chooses to retain the buyer's earnest money, the seller has agreed to: - Answer- Liquidated damages 11. When one party defaults under a contract, the other party is known as the: - Answer- Injured party 12. Earnest money is first applied to the: - Answer- Buyer's down payment 13. The escrow agent is: - Answer- Not a party to the transaction 14. For a valid option to exist: - Answer- -The option fee must be paid directly to the seller or listing broker