Texas Real Estate Law: Promulgated Contracts Final Exam Questions and Answers, Exams of Nursing

Download Texas Real Estate Law: Promulgated Contracts Final Exam Questions and Answers and more Exams Nursing in PDF only on Docsity! promulgated contracts final exam qs Promulgated Contracts Final Exam Containing 70 Questions with Certified Solutions 2024-2025. Under TRELA, a licensee will not be in violation of practicing law without a license if she writes a real estate contract. fills in the blanks on a standardized contract. offers professional advice on Texas real estate law. 1 | P a g e promulgated contracts final exam qs revises promulgated contracts. - Answer: fills in the blanks on a standardized contract. At what point does an offer become a contract? After the licensee fills in all the blanks After the buyer signs it After the seller accepts the buyer's offer After the seller's acceptance is communicated back to the buyer - Answer: After the seller's acceptance is communicated back to the buyer According to the Texas Real Estate Commission (TREC) a listing contract must contain a notice that it was prepared by an attorney licensed in the state of Texas. disclosure about representation of clients. a disclaimer saying that the form was not promulgated by Texas. a provision informing the parties to the contract that real estate commissions are negotiable. - Answer: a notice that it was prepared by an attorney licensed in the state of Texas. All of the following actions would be considered practicing law without a license except which one? Modify a 1997 TREC promulgated contract to fit the buyer's current scenario to purchase a property. Tell the client known facts about the property that might affect the title. Give advice about the legal consequences of the purchase. 2 | P a g e promulgated contracts final exam qs Working Performance - Answer: Performance Consideration is also known as earnest money. something in exchange for something else. option money. lis pendens. - Answer: something in exchange for something else. Novation occurs when a current contract is substituted with a new contract. something in a contract still needs to be executed. a buyer transfers his or her rights to a contract to another. two contracts are valid simultaneously. - Answer: a current contract is substituted with a new contract. Seller Brittany has agreed to a contract term that allows the buyer to purchase her property within two months at an agreed upon price. Which contract feature has Brittany agreed to? Habendum clause The right of first refusal An option These types of agreements are unenforceable in the state of Texas - Answer: An option 5 | P a g e promulgated contracts final exam qs What is the probably best action a seller can take if he or she wants to take a fixture prior to closing? Mark the item with a tag that states that the item does not convey. List the item in the remarks section of the MLS as not conveying. Place a notice on the inside of the front door telling any potential buyers that the item does not convey. Remove the item prior to any showings. - Answer: Remove the item prior to any showings. In completing a sales contract, the sale price should equal the market price. the down payment added to any loans. .the appraised value. the loan amount and closing costs. - Answer: the down payment added to any loans. When a transfer fee is enforced, who receives the payment? The owner of the property The state of Texas The homeowners association The original creator of the covenant - Answer: The original creator of the covenant What agreement is typically made when a buyer moves in before the actual close? Short-term lease agreement 6 | P a g e promulgated contracts final exam qs Buyer's Temporary Lease Seller's Temporary Lease The TREC promulgated purchase agreement addresses this and no further documentation is needed. - Answer: Buyer's Temporary Lease Which of the following statements best defines "promulgate"? To disperse To define a code of conduct To officially publish rules To disseminate - Answer: To officially publish rules What happens to the penalty funds collected from transfer fee violators? They are placed in the general revenue fund of the State. They are placed in the HUD general revenue fund. They are placed in the Real Estate Recovery Fund. They are placed in a holding account to distribute to the victims. - Answer: They are placed in the general revenue fund of the State. In which of the following situations would a temporary lease be inappropriate? When the seller stays in the property for three days after closing. When the buyer moves in the week prior to the closing date. When the seller needs the weekend after closing to finish moving. When the buyer moves in six months prior to the closing. - Answer: When the seller needs the weekend after closing to finish moving. 7 | P a g e promulgated contracts final exam qs It depends upon the ratios set by the lender - Answer: The cash the buyer is putting up plus the sum of all of the financing What paragraph of Form 24-12 (New Home Contract Completed Construction) deals with property damage? 6. Title Policy and Survey D. Objections 16. Escrow D. Damages 7. Property Condition F. Completion of Repairs, Treatments and Improvements 14. Casualty loss - Answer: Casualty loss On the TREC promulgated New Home Contract - Incomplete Construction (23-12), how is the commission paid to the broker to be handled? By a separate written agreement. Fill in paragraph eight (8) in its entirety. Mark the "Commission's are negotiable" box in paragraph eight (8) and then write in paragraph eleven (11) the terms of the commission agreement. It is not addressed in this contract because commissions are regulated by the TREC - Answer: By a separate written agreement. In what paragraph of Form 30-10 - Residential Condominium Contract would you find items dealing with improvements? Property Condition Property and Condominium Documents Title Policy Special Provisions - Answer: Property and Condominium Documents 10 | P a g e promulgated contracts final exam qs What paragraph of Form 30-10 - Residential Condominium Contract deals with requiring the buyer to pay for any deposits mandated by the Association? Closing Prorations Escrow Settlement and Other Expenses - Answer: Settlement and Other Expenses Who is responsible for making sure all applicable addenda have been included with a sales contract? The licensee The buyer The closing agent The TREC - Answer: The licensee How can a licensee determine the terms of the buyer's loan when completing Form 40-5 Third Party Financing Addendum for Credit Approval? The licensee can use the buyer's income and expenses to determine what the buyer can afford. The lender will provide this information after negotiations with the buyer. The buyer tells the licensee what loan terms are acceptable and this information is given to the lender. There is a standard chart the licensee can use. - Answer: The lender will provide this information after negotiations with the buyer. 11 | P a g e promulgated contracts final exam qs What is the best solution if a situation arises and both the seller and buyer agree to alter a binding, signed Residential Contract? A new Residential Contract must be filled out, the action is called novation. The "Amendment to Contract" (TREC 39-7) must be completed and signed by both parties. A counter-contract must be agreed to by both parties and signed. No significant changes can be made on a contract that is signed. - Answer: The "Amendment to Contract" (TREC 39-7) must be completed and signed by both parties. TREC 37-4 Subdivision Information is used to notify the HOA of the new buyer's contact and financial information. request information from the HOA to give to the buyer. notify the title company that a HOA is present in this transaction and Declaration documents must be signed at closing. provide the lender with information on HOA regulations that may affect the position of the lender's mortgage. - Answer: request information from the HOA to give to the buyer. Loan origination charges are not allowed on government backed loans. are prohibited to exceed 1% of the loan amount on all FHA or VA loans. are rarely charged. vary from lender to lender. - Answer: vary from lender to lender. 12 | P a g e promulgated contracts final exam qs A broker could receive a fee from a Residential Service Company (RSC) for providing information such as the size and brand of the hot water heater. the buyer's work history and credit worthiness. demographics of the subject household and surrounding neighborhood. active and sold comparable properties in the area. - Answer: the size and brand of the hot water heater. In a short sale, if the buyer is notified of the bank's approval before the date written paragraph (D) on TREC 45-1 - Short Sale Addendum, the effective date of the contract remains unchanged. is amended to the date of the original agreement or to the date of the lender's approval, whichever is sooner. is amended to the date of notification. the original contract would not have had an effective date due to the fact it is contingent upon the lender's approval. - Answer: is amended to the date of notification. If a loan is assumed by a buyer, what happens to any escrow accounts associated with the property? The escrow accounts will be returned to the seller. With an assumption, there are no prorations of escrow accounts. The escrow accounts will be prorated between the buyer and seller depending upon the date of sale. 15 | P a g e promulgated contracts final exam qs The escrow accounts will be transferred to the buyer assuming the loan. - Answer: The escrow accounts will be transferred to the buyer assuming the loan. What addendum should a licensee use if a buyer needs to sell his home before closing on a second home? TREC 10-6 Addendum for Sale of Other Property by Buyer TREC 14-4 Addendum for Buyer's Contingency of Sale of Current Residence There is no promulgated addendum, the licensee should put limited details in paragraph 11 (Special Provisions) of the TREC promulgated Residential Contract. There is no promulgated addendum, the buyer should contact an attorney for proper communication. - Answer: TREC 10-6 Addendum for Sale of Other Property by Buyer What should a buyer do if he wants to submit an offer on a home that already has a contract on it? Submit an offer with the TREC 12-4, Submission of Secondary Offer. Submit an offer with TREC 11-7 Addendum for Back-up Contract attached. Submit a counteroffer without contingencies. Once a contract has been accepted, no other offers can be accepted. - Answer: Submit an offer with TREC 11-7 Addendum for Back-up Contract attached. What can be done if a seller needs extra time and wants to remain in the home past the closing date? The seller should ask the buyer for permission and correct the closing date on the contract. 16 | P a g e promulgated contracts final exam qs The seller should ask the buyer for permission and both should sign a temporary lease. The buyer's agent should protect their client's interest and not agree to any extension of possession. Once the contract reaches the final stages of closing, this type of request would not be allowed by the underwriter. - Answer: The seller should ask the buyer for permission and both should sign a temporary lease. A buyer leases a property for a period of time and then exercises an option to buy. Which of the following best describes TREC's position regarding the licensee's role in the option contract? TREC discourages licensees from getting involved in the negotiations. TREC prohibits licensees from getting involved. TREC encourages licensees to negotiate these contracts. TREC takes no position on whether licensees should be involved in these contracts. - Answer: TREC discourages licensees from getting involved in the negotiations. TREC No. 10-6 Addendum for Sale of Other Buyer Property by Buyer is used when the mortgage lender requires a larger downpayment. the buyer needs a co-signer. the buyer must sell his current home before closing on his contract. the seller needs to lease back the home after closing. - Answer: the buyer must sell his current home before closing on his contract. 17 | P a g e promulgated contracts final exam qs Occupying a pre-existing home in a designated wetland - Answer: Filling in areas with topsoil According to TREC Residential Contract, who is to advise the buyer to have an attorney examine the abstract or obtain a title policy? The licensee The seller The title officer No one is required - Answer: The licensee What does the use of the TREC OP-H Seller's Disclosure of Property Condition form facilitate? The transition of possession between the buyer and seller The disclosure of any structural defects that are in need of repair that exceed 5% of the sales price. The seller meeting regulations concerning the disclosure of the condition of the property The prioritized repair agreement between the buyer and the seller. - Answer: The seller meeting regulations concerning the disclosure of the condition of the property Who should sign the TREC OP-I - Texas Real Estate Consumer Notice Concerning Hazards or Deficiencies form? The seller The buyer 20 | P a g e promulgated contracts final exam qs Both the seller and buyer Neither the buyer nor seller - Answer: Neither the buyer nor seller What should the licensee do with the TREC OP-C - Notice to Prospective Buyer form? Give a copy to the seller and the original to the buyer. Give a copy to the buyer and the original to the seller. Give a copy to the buyer and retain the original in file. Give a copy to the seller and retain the original in file. - Answer: Give a copy to the buyer and retain the original in file. Which of the following transactions require a TREC OP-H - Seller's Disclosure of Property Condition, to be provided? When the transfer is the result of a divorce. When the transfer is from a professional investor in real estate. When the property is taken by a trustee in a bankruptcy. When the transfer is handled by an executor. - Answer: When the transfer is from a professional investor in real estate. What is the purpose of the TREC OP-K - Information About Brokerage Services form? It allows the seller or the buyer and the broker to agree upon the services that are to be provided. Informing the buyer and seller as to the function of the licensee in terms of agency. 21 | P a g e promulgated contracts final exam qs It provides information to the buyer and seller about the brokerage services available. It describes the relationship between the brokerage company and the salesperson. - Answer: Informing the buyer and seller as to the function of the licensee in terms of agency. If a home is built prior to what year does it trigger the mandatory disclosure on lead based paint? 1972 1978 1982 1986 - Answer: 1978 When should the TREC OP-M - Non-Realty Items Addendum be used? When the seller agrees to leave certain personal items. When the seller wants to retain certain items that are attached to the real property. When the seller wants to disclose to the buyer certain property conditions. When the seller must replace certain items on the property listed on the OP-M form. - Answer: When the seller wants to retain certain items that are attached to the real property. What is not an option on the TREC OP-K - Information About Brokerage Services form? Representing the buyer 22 | P a g e