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Texas Promulgated Contract Forms Exam Questions and Answers
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Texas Promulgated Contract Forms Exam Questions and Answers
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Texas Promulgated Contract FormsExam Questions and Answers
What determines whether someone is a competent party? - Correct Answers -18 years
old
Mentally competent
Cannot be temporary incompetent
What is the minimum age a person must have attained to be of legal age in Texas? -
Correct Answers -18
To make a valid contract, there must be four elements, including Agreement,
Competent Parties and Legal objective. Which one is missing? - Correct Answers -
Consideration
What are the four basic elements of a contract? - Correct Answers -Agreement
Competency
Consideration
Legal objective
What group administers the Texas Real Estate License Act? - Correct Answers -Texas
Real Estate Commission
Mutual agreement is an agreement to - Correct Answers -all the terms by all the parties
of a contract. If one term cannot be agreed to, then the entire offer never becomes a
contract.
It is necessary for courts to effectively interpret contracts.
Acceptance must be absolute and must be entered into freely and voluntarily. The
contract cannot contain: - Correct Answers -Misrepresentation - an error
Fraud - intentional misrepresentation
Duress - use of force
Menace - threat of violence
Undue Influence - use of power
Consideration is defined as - Correct Answers -something in exchange for something
else.
It is a essential element for a valid contract
,There are two types of consideration: - Correct Answers -valuable consideration -
Valuable consideration is something of value.
good consideration - Good consideration is "love and affection."
What is misrepresentation? - Correct Answers -An error
What is a court's primary objective when interpreting a contract? - Correct Answers -To
ascertain and give effect to the intent of the parties
What is duress? - Correct Answers -Use of force
What is it called when all terms in a contract are agreed to by all the parties of the
contract? - Correct Answers -Mutual Agreement
Consideration is also known as what? - Correct Answers -Something in exchange for
something else
What is it called when someone listens to both sides of the situation and makes a
decision? - Correct Answers -Arbitration
A contract is valid when all of these five conditions are met: - Correct Answers -The
written agreement is legal, the parties to the contract have a legal right to enter the
contract
Every item is completely agreed to
The buyer and seller are sane and of legal age
There is nothing in the document that is illegal or against public policy, the contract is for
legal purposes
All of the applicable addenda to a contract are included in the document
Void translates as - Correct Answers -"absence of", meaning the contract never existed.
Coercion, threats, false statements, undue influence, misrepresentation, improper
persuasion and fraud could be reasons to - Correct Answers -make a contract voidable
by the party who feels they were the victim of unfairness.
When two parties agree to a contract and sign it, then that contract is said to be -
Correct Answers -executed.
That is, the negotiations of the contract have been completed.
, Executory contracts defer material action by either party into the future. Any contract for
deed, lease option, or purchase option longer than 180 days is defined by - Correct
Answers -Texas Property Code as an executory contract.
Who fills out the Seller's Disclosure Notice? - Correct Answers -The owner/Seller
Who is responsible for making sure all applicable addenda have been included with the
contract? - Correct Answers -The client's agent
What legal status does a void contract have? - Correct Answers -None. A contract that
never existed.
Fraud in a contract makes it what? - Correct Answers -Voidable
What type of contract is it when two parties agree to and then sign it? - Correct Answers
-Executed
What is the definition of an executory contract? - Correct Answers -Contract for deed,
lease option, or purchase option longer than 180 days
After a contract has been agreed upon by both parties and a problem arises that needs
the contract to be changed, the agent of the client that wants the contract to be adjusted
will submit the to the other agent? - Correct Answers -Amendment
One item that cannot be changed by using an amendment is the? - Correct Answers -
brokerage fee, also called a commission.
This should already have been determined in the listing agreement between the seller
and the listing broker.
The Down Payment plus the Loan Amount should always equal the? - Correct Answers
-Sales price.
What is the best solution to solve a situation when the seller and buyer agree to alter a
binding One to Four Family Residential Contract (Resale)? - Correct Answers -The
"Amendment" must be completed and signed by both parties
How can an agent determine the terms of the buyer's loan when completing the Third
Party Financing Addendum? - Correct Answers -The lender will provide this information
after negotiations with the buyer
Alicia is set to close on her new home in three days, but today she received a phone
call from her agent stating that the lender needs to push closing back seven days.
What, if any, action needs to be done? - Correct Answers -Alicia's agent should submit
an "Amendment to Contract" with the new closing date to the seller's agent
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