TX Law of Contracts

  1. A contract for the sale of real estate that does not state the consideration to be paid for the property is not signed by the parties is considered to be:



    A. void
  2. Max makes an offer on Roberts house, Robert accepts, and Max is notified of the acceptance. Both parties sign the sales contract. At this point, Max has what type of title to the property?



    C. Equitable
  3. A seller gave a listing to several brokers, specifically proising that if one of the brokers found a buyer for the real estate, the seller would then pay a commission to the broker. This offer by the seller is what type of agreement?



    C. Unilateral
  4. A contract is said to be bilateral if



    B. all parties to the contract are bound to act
  5. In the completion of a promulated contract form, several words were crossed out and others intserted. To eliminate future controversy as to whether the changes were made before or after the contract was signed, the broker should.....
    have both parties initial or sing in the margin near each change
  6. If after the sales contract is sined, the seller decides not to sell,
    the buyer may insitute a suit for specific performance of the contrat and/or for money damages
  7. Under the statute of fradus, contracts for the sale of real estate must be



    D. in writing to be enforceable
  8. During the period after a real estate sales contract is signed but before title actually passes, the status of the contract is....



    B. executory
  9. QQQ
    Which is NOT one of the elements for a valid contract?



    C. earnest money
  10. QQQ
    Ramon has a contract to buy property but would rather let his friend Mark buy it instead. If the contract allows, Mark can take over Ramon's contract rights by the process known as



    A. assignment
  11. Stella makes an offer to purchase certain property listed with a broker Sam and leaves a deposit with the broker to show good faith. When the contract is accepted, Sam should....
    deposit the funds in an escrow account of a title company within two working days
  12. QQQ
    Which BEST describes the contract for deed or installment contract?



    A. a method of selling real estate whereby the purchaseer pays for the property in regular installments while the seller retains title to the property
  13. When a real estate sales transaction is to be closed through an escrow agent,
    a. the seller and escrow agent execute a separate escrow agreement
    b. the buyer's purchase-money mortgage and note are deposited with the escrow agent
    c one of the parties to the contract is usually appointed as the escorw agent
    d. the buyer sets forth the obligations of the escrow agent
    b. the buyer's purchase-money mortgage and note are deposited with the escrow agent
  14. A contract may be discharged by all EXCEPT which of the following means?



    C. change in the marital status of one party
  15. A suit for specific performance of a real estate contract ask for



    C conveyance of the property
  16. When a broker uses a client's earnest money for his or her own personal use, the broker is guilty of...



    A conversion
  17. An option-to-purchase agreement



    A. is generally limited to a fixed price within a specified time period
  18. Under contract for deed, the purchaser...



    D. is required to pay taxes and insurance on the property
  19. QQQ
    In Texas, who is authorized to draft deeds, mortgages, deeds of trust and notes?
    an attorney licensed to practice law
  20. Define Contract
    a voluntary, legally enforceable promise between two competent parties to perform some legal act in exchange for consideration
  21. DEFINE bilateral contract
    contract that must have two promises
  22. DEFINE unilateral contract
    contract that has only one promise
  23. Offer and acceptance are not present if
    what 4 items are involed?
    misrepresentation, fraud, undue influence or duress are involved
  24. Give legal effect of

    VALID contract
    binding and enforceable on both parties

    EXAMPLE: agreement complying with essentials of a valid contract
  25. Give legal effect and example of
    VOID CONTRACT
    • legal effect: none, no legal effect
    • example: contract for an illegal purpose
  26. Give legal effet and example of
    VOIDABLE contract
    • Legal effect: valid, but may be disaffirmed by one party
    • Example: contract with a minor
  27. Give legal effect and example of
    UNENFORCEABLE contract
    • legal effect: valid between the parties, but neither may force performance
    • Example: certain oral agreements
  28. NOTE: If a licesne holder, who has authority to bind a party to lease or sale under a power of attorney or a property management agreement, executes the agreement, that license holder is also considered to be a party to the lease or sale
  29. assignment =
    subsitution of parties
  30. novation =
    subsitution of contracts
  31. What effect does a counteroffer have on an offer?
    it is a rejection
  32. Who must sign or nitial contract?
    buyers and sellers
  33. Where are the IRS regulations cited in a contract
    paragraph 20
  34. Is earnest money necessary to make contract binding? why is it collected?
    no, it a gesture of good faith
  35. What are loan fees based on?
    loan amount
  36. What does rescission mean
    cancel or terminate
  37. What s Consideration?
    $$$, sales price
  38. What offers must be presented to the seller? When deos an offer become a contract?
    • all, unless seller provided other instructions
    • when parties accept and contract is signed by both
  39. Can oral contracts be enforced?
    NO
  40. What is a suit for specific performance?
    lawsuit demanding seller to sell or buyer to buy
  41. Who does escrow protect?
    both principals
  42. What is the name of the law that requires a real estate contrat to be in writing?
    Statute of Frauds
  43. What is difference between void and voidable?
    • void: never existed
    • voidable: can be void if terms can not be met
  44. define "liquated damages"
    earnest $$
  45. what is a contract for deed?
    • buyer gets deed when debt is paid
    • buyer pays taxes, insurance and upkeep
  46. who makes final deecision on mortage loan for lender?
    underwriter
  47. what is the broker-lawyer committee?
    • 13 members who update contracts
    • (6 brokers, 6 lawyers, 1 member at large)
  48. who does a title insurance policy protect?
    buyer, lien holder
  49. what are the exceptions to use of Promulgated forms
    • agent is principal
    • HUD Repo???
    • new home
    • no form exists
  50. when must the amendment addendum be used
    when a change to contract is made
  51. define comingling
    mixing $$$
  52. When is a broker allowed to give legal advice or draft legal instruments
    : NEVER
Author
Anonymous
ID
54175
Card Set
TX Law of Contracts
Description
Law of Contracts
Updated