AYPO Real Estate Promulgated Contracts Final Exam Review with Verified Answers, Exams of Nursing

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AYPO Real Estate Promulgated Contracts Final Exam Review

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1. Which of these is an exemption to the "legal capacity" requirement to form a contract? - Correct Answers A contract for a life necessity.
2. A contract for non-life necessities with a person lacking legal capacity is: - Correct Answers Voidable
3. A contract for deed is a classic example of a(n): - Correct Answers Executory contract
4. An option is a form of which kind of contract? - Correct Answers Unilateral
5. According to TREC a "reasonable time" within which to deposit the escrow check is: - Correct Answers By the end of the second business day following formation of the contract.
6. An attachment added to the end of a contract and incorporated in the contract terms is called an: - Correct Answers Addendum
7. An assignment of rights is: - Correct Answers A transfer of rights or duties under a contract from a current party to a contract to another party.
8. An oral contract for the lease of a property for one year or less has a statute of limitation of: - Correct Answers Two years
9. Which of these IS NOT a potential reason for terminating a contract? - Correct Answers Specific performance
10. The Real Estate License Act was created to: - Correct Answers 1. Maintain high standards in the real estate profession.
11. 2. Protect licensed brokers and salespersons from unfair or improper competition.
12. 3. Protect the public interests from dishonest or incompetent brokers or salespersons.
13. The unauthorized practice of law would include all of these actions by a licensee, except: - Correct Answers Inserting minor handwritten notes on the contract initialed by all parties.
14. The Broker-Lawyer Committee: - Correct Answers Develops forms for TREC to adopt and promulgate at their discretion.

15. The current One to Four Family Residential Contract (Resale) is which of these form numbers? - Correct Answers 20-
16. What is/are the seller's options when receiving an offer? - Correct Answers 1. Counter.
17. 2. Accept.
18. 3. Reject.
19. The offer becomes a sales contract when: - Correct Answers It is accepted, signed by the seller, and acceptance communicated to the buyer or buyer's agent.
20. Which of these IS NOT in the information requested above? - Correct Answers Who is the buyer's employer?
21. Identification of the buyer and seller must include: - Correct Answers Full name and marital status of all parties.
22. For items for which a promulgated addendum is provided the proper way to include the item is: - Correct Answers Through use of the addendum.
23. Which form of financing does the "Third Party Financing Addendum NOT cover?
    • Correct Answers Seller financing
24. The Promissory Note section of the Seller's Financing Addendum includes: - Correct Answers 1. 5% penalty on installment payments paid more than 10 days past their due date.
25. 2. 1.5% per month or highest lawful rate, whichever is lower, for mature unpaid amounts.
26. 3. Prepayment without penalty.
27. VA will not restore Seller's VA entitlement unless Buyer: - Correct Answers 1. Has sufficient unused VA entitlement remaining.
28. 2. Is a veteran.
29. 3. Is otherwise qualified.
30. How much earnest money does Texas state law require to validate a real estate sale contract? - Correct Answers No earnest money is required.
31. For how many days is a Paragraph 23 option valid? - Correct Answers The length of the option period is set by the contracting parties.
32. TREC 1-4 Paragraph 6C lists what options for providing the survey to buyer within a number of days after the effective date of this contract set by the parties'

48. 3. Acceptance of the property "as is," with an agreement to receive proceeds of any insurance coverage allowable, with other compensation from seller, e.g., reduced price, or, with no compensation and buyer absorbs any costs
49. Which of these IS NOT listed as a potential damages item for wrongfully failing or refusing to sign a release acceptable to the escrow agent within 7 days of receipt of the request? - Correct Answers Broker's fees
50. Which of these IS NOT an addendum listed in TREC 1-4 §22 Agreement of Parties? - Correct Answers Addendum for Inclusion and Exclusion of Personal Property
51. Unless otherwise agreed, the Option Fee must be delivered to the seller by: - Correct Answers Third day after the sales contract was executed.
52. Which of these generally will not include a structure of any sort in the sale? - Correct Answers Unimproved Property Contract
53. Which paragraph is different from the TREC 1-4 in all five of the other property sales contracts? - Correct Answers §
54. Which of these IS NOT a difference between the Condominium Sales contract and the TREC 1-4? - Correct Answers Paragraph 7 disclosures.
55. Which of these Farm and Ranch Contract sections IS NOT distinguished from the TREC 1-4? - Correct Answers §15 Default
56. Which of these contracts does not include rollback taxes in §13? - Correct Answers One to Four Family Residential Contract (Resale) [TREC 1-4]
57. §2 Property of the New Construction Contracts does not include which of these?
    • Correct Answers 1. Exclusions
58. 2. Improvements
59. 3. Accessories
60. If a buyer needing to sell another property chooses not to use the addendum then fails to come up with the funds, they risk: - Correct Answers 1. Being found in default.
61. 2. Losing their earnest money.
62. 3. A lawsuit from the seller who could file a legal action for specific performance or other remedies.
63. If Buyer and Seller execute a back-up contract effective on a Monday (in a week with no holidays) with a 10-day option to terminate, unless otherwise agreed, what is the deadline for depositing the buyer's earnest money? - Correct Answers Wednesday by 5pm

64. Using the Addendum for Reservation of Oil, Gas, and Other Minerals, a seller can reserve: - Correct Answers 1. Any portion of their mineral estate rights.
65. 2. All of their mineral estate rights.
66. Which of these IS listed as a reason for termination? - Correct Answers 1. The Property does not satisfy Property Approval in accordance with the Third Party Financing Addendum to the contract.
67. 2. Buyer elects to terminate under Paragraph 7B(2) of the contract relating to the Seller's Disclosure Notice.
68. 3. The unrestricted right of Buyer to terminate the contract under Paragraph 23 of the Contract.
69. The TAR 1904 form is properly used to: - Correct Answers Acknowledge termination of a contract and release earnest money according to the terms of the agreement.
70. Which of these IS a warning issued on the Addendum for Property Located Seaward of the Gulf Intracoastal Waterway? - Correct Answers 1. Be prepared to move or demolish any structure determined to be too close to the shoreline even if it was legal when built or purchased.
71. 2. All of these are warnings on the Addendum.
72. Take caution because beach erosion can change the shoreline and, along with it, change the legal status of a structure's location.
73. 3. Beware of legal risks inherent with purchase of this property.
74. Which of these IS NOT part of the subdivision information referenced by the Addendum for Property Subject to Mandatory Membership in a Property Owners Association? - Correct Answers The title commitment
75. The Short Sale Addendum protects both the buyer and seller because: - Correct Answers The parties have contractually agreed performance requirements and seller's ability to perform these obligations is subject to lender approval.
76. Which of these forms is for general consumer or client information, and not directly related to a sale? - Correct Answers 1. Consumer Information Form
77. 2. Information About Brokerage Services
78. Which of these IS NOT an item properly suited to inclusion in a Non-Realty Items Addendum? - Correct Answers Smart car
79. DTPA only applies to real estate transactions in situations involving: - Correct Answers 1. A failure to disclose information known by the licensee at the time of the transaction if the non-disclosure was intended to induce the consumer into a transaction they would not have entered if they were aware of the undisclosed information.

communicated to the other part or their representative and has been signed by both parties

95. Which of these forms is for general consumer or client information, and not directly related to a sale - Correct Answers Information about brokerage services
96. Consumer information form
97. An executory contract is one that does which of the following - Correct Answers Still has a material duty needing to be preformed.
98. Which of these IS NOT a potential reason for terminating a contract - Correct Answers Specific performance
99. The buyer is obligated to pay the buyer's broker's fees generally only under which of the following situations? - Correct Answers The commission is agreed to in a buyer's representation agreement.
100. A title insurance "commitment" provides a buyer: - Correct Answers With the terms and conditions under which the title company will be issuing the title insurance policy
101. The Texas Association of Realtors (TAR) 1094 Release of Earnest Money Form is which of the following? - Correct Answers Acknowledging that there is an agreement between the parties the contract is terminated
102. The Seller's Disclosure is designed to clearly identify all of these, except - Correct Answers Terms of the loan agreement.
103. Before signing a purchase contract, the licensee must give a buyer written advice to: - Correct Answers Have the abstract covering the property examined by an attorney of the buyer's selection
104. Obtain an owner's title insurance policy prior to closing
105. How much will a bank be financing on a $240,000 home where the buyer puts 20% down? - Correct Answers $192,
106. To be able to effectively use the option provided under §5 Earnest Money and Termination, the option must be signed and paid for by which of these points? - Correct Answers Within 3 days of the parties signing the contract
107. Which of these IS NOT an item properly suited to inclusion in a Non- Realty Items Addendum? - Correct Answers Smart Car

108. An "assignment of rights"is best described by which of the following? - Correct Answers A transfer of rights or duties under a contract from a current party to a contract to another party
109. Which paragraph of the TREC 1-4 contract lists the different addenda that are available? - Correct Answers 22
110. To receive a daily rate of $40 in a buyer's or seller's lease, the monthly rate would have to be set at which of these monthly rates? - Correct Answers $1,
111. Which form of financing does the "Third Party Financing Addendum" NOT cover? - Correct Answers Seller Financing
112. To waive a contingency on the Addendum for Sale of Other Property by Buyer, one must do all of these except which of these? - Correct Answers Provide evidence to support a decision to waive the contingency.
113. most multi-page promulgated contracts have a blank space at the top of each page after page one for: - Correct Answers The address of the property central to the transaction
114. "psychological stigmas," which involve violent or catastrophic events on a property, fall under which category of disclosure? - Correct Answers Permitted disclosutes
115. Which category of disclosure do "psychological stigmas" fall into in Texas?

- **Correct Answers** Permitted 

116. Which of these IS NOT required to have a valid executed date? - Correct Answers Notarized third-party witness
117. In most circumstances, the licensee will obtain two checks from the prospective buyer when writing the offer: - Correct Answers One for earnest money payable to the escrow or title company, and one for the option money payable to the seller.
118. The Mineral Estate does NOT include which of these? - Correct Answers Iron
119. Which of these contracts is voidable and not inherently void? - Correct Answers A contract with a person not of legal competence at the forming of the contract
120. Failure to timely transmit an offer to a seller may result in which of the following? - Correct Answers License Revocation

135. The information About Brokerage Services handout should be provided to a prospect - Correct Answers at the first substantive discussion
136. The Broker-Lawyer Committee was established by: - Correct Answers The Real Estate License Act
137. The Texas association of Realtors Code of Ethics states that an offer should be presented to the client: - Correct Answers At the earliest opportunity
138. What are two major forms of making modifications to a contract? - Correct Answers Amendment and addenda
139. Which of these is a part of the Seller Financing Agreement - Correct Answers Buyer's Credit Approval
140. Deed of Trust
141. Promissory Note
142. The Loan Assumption Addendum warning(s) include which of the following? - Correct Answers Advising the buyer not to sign the contract without examining the notes and deed of trust if the buyer has any concerns about future adjustments or the other factors impacting the terms
143. Advising the seller to use the TREC Release of Liability Addendum if the seller is concerned with being at risk of retaining liability on the assumed notes
144. What is the proper method for calculating rent in a buyer's or seller's lease agreement - Correct Answers The charge should be a daily charge based on a desired 30-day monthly rental rate.
145. Paragraph 7 regarding disclosures is different from the TREC 1-4 in all of the contracts except for which of the following? - Correct Answers Residential Condominium Contract
146. in §6B of the TREC 1-4, the agreement calls for the seller to furnish the buyer a title commitment within ___ days - Correct Answers 20
147. _____ is the form that licensees are most likely to work with the most frequently. - Correct Answers One to Four Family Residential Contract (Resale)
148. An oral contract for the lease of a property for one year or less has a statute of limitation of - Correct Answers Two years
149. HUD's primary concern is to ensure that any occupancy standards are not so strict as: - Correct Answers to undo protections of families with children