Use of the TREC promulgated One to Four Family Residential Contract (Resale):
A. Is allowed on the sale of a residential condominium
B. Can be used for a vacant residential lot
C. Covers single family, duplex, triplex, and fourplex transactions
D. All of the above
Rationale: The correct answer...
Use of the TREC promulgated One to Four Family Residential Contract (Resale):
A. Is allowed on the sale of a residential condominium
B. Can be used for a vacant residential lot
C. Covers single family, duplex, triplex, and fourplex transactions
D. All of the above
Rationale: The correct answer is C. The TREC One to Four Family Residential Contract (Resale) covers
single family, duplex, triplex, and fourplex transactions. - ANSWERSC. Covers single family, duplex, triplex,
and fourplex transactions
Broker's fees are:
A. Included in the One to Four Family Residential Contract (Resale) between the Buyer and the Seller
B. Determined by writing in the Information About Brokerage Services
C. Determined by writing in the Listing Agreement
D. Both B and C
Rationale: The correct answer is C. Broker fees are agreed in the listing agreement between the Seller
and the Broker. The Broker has the ability to share those fees with an agent from an outside company
who works with a buyer. - ANSWERS
Fraud is:
A. A crime
B. A civil law violation
C. Both A and B
D. Only B
Rationale: The correct answer is C. Fraud can be prosecuted as a crime. Fraud charges also can go
through the courts as civil law violations. - ANSWERS
Federal Fair Housing Laws forbid discriminatory practices by parties including:
,A. Owners of properties
B. Lenders
C. Real estate brokers
D. All of the above
Rationale: The correct answer is D. Discriminatory practices are NOT allowed in any transaction. -
ANSWERS
In a real estate transaction, the legal description is NOT:
A. Lot and block
B. Metes and bounds
C. A street address
D. A description of the property from a surveyor's field notes
Rationale: The correct answer is C. The legal descriptions in Texas are: Lot and block, and metes and
bounds (sometimes also called surveyor's field notes). A street address is NOT a legal description. -
ANSWERS
Earnest money:
A. Constitutes the consideration
B. Is used to make the offer more enticing to the seller
C. Is required in the contract
D. Always equals 1% of the sales price
Rationale: The correct answer is B. Earnest money is a gesture of good faith and is used to make the offer
more enticing to the seller. It can be any amount that the Buyer wishes to offer, and the Seller is willing
to accept. - ANSWERS
Chapter 531 Canons of Professional Ethics and Conduct includes::
A. Fidelity
B. Integrity
C. Competency
D. All of the above
, Rationale: The correct answer is D. Fidelity, Integrity and Competency are all a part of Canons of
Professional Ethics and Conduct. - ANSWERS
In the Buyer Agreement, Intermediary is in Paragraph 8. The paragraph is the same in the Buyer
Agreement and in the:
A. Listing agreement
B. Sales contract
C. Inspecting report
D. Seller's Disclosure
In Paragraph 3B of the sales contract, the 'sum of all financing':
A. Includes the earnest money deposited at the time the contract is executed
B. Includes the closing costs
C. Excludes any loan funding fee or mortgage insurance premium
D. All of the above
Rationale: The correct answer is C. The sum of all financing applies to the amount of the loan. It does not
include any closing costs. The FHA mortgage insurance and the VA funding fee are part of the closing
costs and can be financed, but these are handled separately by the loan company. - ANSWERS
The sales price in Paragraph 3:
A. Is determined by adding the down payment (3A) and the loan amount (3B)
B. Does not include closing costs
C. Can be all cash
D. All of the above
Rationale: The correct answer is D. The sales price is the cash down payment plus the loan amount
(which does not include any closing costs). 3A (down payment) + 3B (loan amount, if any) = 3C (sales
price). If the offer is all cash, then 3B will be zero because there will be no loan involved. - ANSWERS
The Seller contracts to furnish the buyer an existing survey, but neglects to furnish an "affidavit" within
the time specified. The lender requests a new survey be furnished. Who pays for the new survey?
A. If the existing survey is rejected, then whoever is stated in the contract pays.
B. The title company can approve the existing survey and override the lender.
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