Exam (elaborations)
LAW OF CONTRACTS EXAM QUESTIONS WITH CORRECT ANSWERS
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LAW OF CONTRACTS EXAM
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LAW OF CONTRACTS EXAMA sale and leaseback agreement is: - answera way for landowners to free up capital
while maintaining the same overhead expenses
With net leases, each added "net" requires a tenant to pay for an additional expense
that may have otherwise fallen on the landlord. All of the following are expenses that
could be paid under a net lease EXCEPT: - answerdebt interest
(Any lease that requires a tenant to pay rent, property taxes, insurance, and
maintenance expenses is a triple-net lease.)
What allows the courts to identify a property with reasonable certainty? - answerThe
legal property description from the deed
A promissory note is: - answerthe borrower's personal promise to repay the loan to the
lender
Who is responsible for writing commission checks to the brokers? - answerTitle
Company
During a contract for deed: - answerThe seller hold the legal title to the property and the
buyer is entitled to possession and equitable title to the property
An orange tree (which is not moveable and is something growing on the land in
question) would be considered: - answerreal property
Real Property is the land plus improvements on the land (including what's growing on
the land).
Real estate loans are bought and sold on the: - answersecondary mortgage market
What is an executed contract? - answera contract in which all terms have been fulfilled
by all parties
Aviv and Gregory are friends who are also parties to a real estate sale. They agree over
a sale price verbally because they trust each other. As per the Statute of Frauds, which
of the following is TRUE regarding the enforceability of their contract? - answerFor their
contract to be enforceable, it must be in writing AND signed by the party being charged.
Contracts must be in writing and signed by the party to be charged to be enforceable.
Jasper and Aziz are engaging a real estate transaction. They want to make sure the
interest being conveyed is officially and accurately recorded. What would they use to do
that? - answerone of the sales contracts promulgated by TREC
, The six TREC-promulgated sales contracts describe the conveyance that the buyer and
seller are agreeing upon.
According to the TREC contracts, the title company (on behalf of the seller) will send
what to the buyer within 20 days after they receive the signed contract? -
answerCommitment for title insurance
Which of the following about the unauthorized practice of law and real estate contracts
is TRUE? - answerlicense holders are able to complete (fill in the blanks of) real estate
contracts promulgated by TREC but should NOT create their own contracts
If the buyer wants to make the contract contingent upon their ability to have
environmental inspections of the property, the correct way to do that is: - answerAttach
the Environmental Assessment, Threatened or Endangered Species, and Wetlands
Addendum to the offer.
What is eminent domain? - answerthe power of the state to seize a citizen's private
property or rights in a property WITH compensation but without the consent of the
owner (prop taken for gov. use
A seller's homeowner's insurance policy is cancelled at the time of closing. They will
receive WHAT after closing for the part of their premium that was paid in advance? -
answerA refund check
WHAT loan programs are great for first-time homebuyers because they offer loan
programs that focus on low down payments? - answerFHA & VA loans
A buyer's offer is returned with two changes made. The proposed contract is now a(n): -
answercounteroffer
A buyer decides to terminate the contract during his option period. He will submit the
Termination of Contract notice to the seller and will be entitled to: - answerA refund of
the earnest money
Real estate loans are bought and sold on the: - answersecondary mortgage market
Which legal concept places a limit on the amount of time that an individual has to take
legal action against another individual in order to recover any losses or damages? -
answerStatute of Limitations
A license holder can have their license suspended or revoked if: - answerThey fail to
use a contract form required by TREC
An unenforceable contract is one that has (or had) the potential of being a valid
contract, but its enforcement is (or was) barred by some attribute of the contract or a
technicality of law. Which of the following is NOT a law that could make a contract
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