Promulgated Contract Forms -
Champions School of Real Estate Exam
Questions and Complete Solutions
Graded A+
There are _____ classifications of contracts. - Answer: 4
A VALID CONTRACT - - Answer: MEETS ALL THE REQUIREMENTS OF LAW
A VOID CONTRACT - - Answer: IS INVALID FROM THE START, SUCH AS A CONTRACT FOR SOME ILLEGAL
ACT
A VOIDABLE CONTRACT - - Answer: NOT ENFORCEABLE AGAINST AT LEAST ONE OF THE PARTIES
A UNENFORCEABLE CONTRACT - - Answer: HAS A FLAW AND CANNOT BE ENFORCED, TOO MUCH TIME
HAS ELAPSED OR OTHER ISSUES THAT MAKE IT UNENFORCEABLE
ELEMENTS TO HAVE A VALID CONTRACT ARE FOUND IN THE ACRONYM C-O-L-I-C: - Answer: COMPETENT
PARTIES, OFFER AND ACCEPTANCE, LEGAL PURPOSE, IN WRITING AND CONSIDERATION.
PLEASE NOTE THAT ACCEPTANCE CAN ALSO BE KNOWN AS MUTUAL CONSENT.
___________________________ IS SOMETHING OF VALUE GIVEN IN EXCHANGE FOR A PROMISE. IT
DOES NOT HAVE TO BE MONEY AND IT IS DEFINITELY NOT THE EARNEST MONEY BECAUSE EARNEST
MONEY IS NOT A REQUIREMENT TO HAVE A VALID CONTRACT - Answer: CONSIDERATION
CONTRACTS ARE REFERRED TO AS _____________________________________________ ONCE THEY
HAVE BEEN SIGNED BY ALL PARTIES AND IT HAS BEEN COMMUNICATED TO ALL PARTIES. IT WILL BE
CALLED THIS UNTIL IT GOES TO CLOSING WHERE IT SHOULD BE FINALIZED OR FULLY EXECUTED. -
Answer: EXECUTORY CONTRACTS
AN _____________________ IS A GOOD EXAMPLE OF A UNILATERAL CONTRACT. IN THIS CONTRACT
THE SELLER HAS GIVEN THE BUYER THE RIGHT TO PURCHASE THE PROPERTY AT A PRESET PRICE AND
TERMS FOR A PERIOD OF TIME. THE BUYER HAS PAID THE SELLER SOME CONSIDERATION UP FRONT,
USUALLY IN THE FORM OF AN OPTION FEE. - Answer: OPTION CONTRACT
_________________ ARE USED TO CHANGE SOME OF THE ORIGINAL PROVISIONS IN A CONTRACT.
COMMON EXAMPLES ARE: TO CHANGE THE SALES PRICE, CHANGE THE CLOSING DATE, REQUEST
REPAIRS OR TO REMOVE SOME CONTINGENCY. - Answer: AMENDMENTS
IF THE LANGUAGE ON THE ADDENDUM CONTRADICTS THE LANGUAGE IN THE CONTRACT FORM, THE
______________________ PREVAILS. - Answer: ADDENDUM
AN __________________ IS A TOTAL TRANSFER OF THE BUYER'S RIGHTS AND LIABILITIES UNDER A
CONTRACT. CONTRACTS FOR PERSONAL SERVICES ARE NOT ASSIGNABLE, SUCH AS THE LISTING
AGREEMENT OR THE BUYER REPRESENTATION AGREEMENT. - Answer: ASSIGNMENT
THERE ARE SEVERAL WAYS CONTRACTS CAN BE TERMINATED SUCH AS.... - Answer: MUTUAL
AGREEMENT, PARTIAL PERFORMANCE, SUBSTANTIAL PERFORMANCE, IMPOSSIBILITY, OPERATION OF
LAW OR BREACH OF CONTRACT BY ONE OF THE PARTIES.
AN EXAMPLE OF _______________________________ IS WHEN THE LANDLORD ALLOWS A TENANT TO
TERMINATE A LEASE EARLY WITHOUT HOLDING THEM LIABLE FOR THE BALANCE OF THE TERM. AN
EXAMPLE OF IMPOSSIBILITY WOULD BE DEATH OF ONE OF THE PARTIES, BUT IT WOULD NOT INCLUDE
DEATH OF THE SALES AGENT ASSISTING PARTIES IN THE TRANSACTION. - Answer: PARTIAL
PERFORMANCE
TREC ESTABLISHED THE _____________________________________________ TO WRITE THE
LANGUAGE IN THE RESIDENTIAL CONTRACT FORMS TO HELP AGENTS AVOID THE UNAUTHORIZED
PRACTICE OF LAW.
, AFTER THE LANGUAGE IS WRITTEN AND APPROVED BY TREC, THE CONTRACTS ARE PUBLISHED, OR
PROMULGATED, AND AGENTS ARE REQUIRED TO USE THEM WHENEVER POSSIBLE. - Answer: BROKER
LAWYER COMMITTEE
IN ADDITION TO THE TREC PROMULGATED CONTRACTS, LICENSE HOLDERS MAY ALSO USE A CONTRACT
WRITTEN BY.... - Answer: A TEXAS ATTORNEY FOR A PARTICULAR TRANSACTION, ONE REQUIRED BY THE
OWNER AND PREPARED BY THEM OR THEIR ATTORNEY, OR ONE REQUIRED BY THE OWNER OR A
GOVERNMENT ENTITY.
TREC HAS PROMULGATED CONTRACT FORMS FOR MOST RESIDENTIAL TRANSACTIONS:
(NOTE: TREC DOES NOT HAVE CONTRACTS FOR COMMERCIAL PROPERTIES OR THE SALE OF CO-OPS) -
Answer: ONE-TO-FOUR FAMILY, NEW HOME INCOMPLETE, NEW HOME COMPLETED, UNIMPROVED
PROPERTY, FARM AND RANCH CONTRACT AND CONDOMINIUM RESALE CONTRACTS.
TREC CAN SUSPEND OR REVOKE A LICENSE IF THEY LEARN THAT A LICENSE HOLDER.... - Answer: DREW A
DEED, NOTE, DEED OF TRUST, WILL OR, OTHER WRITTEN DOCUMENT, THAT TRANSFERRED OR
AFFECTED THE TITLE TO OR AN INTEREST IN LAND.
ALSO, DON'T GIVE LEGAL ADVICE, WRITE LENGTHY PROVISIONS IN THE CONTRACT OR MARK OUT ANY
PREPRINTED PROVISIONS.
SOME STATES HAVE LEASES WITH A ___________________________________ WHICH MEANS THE
TENANT CAN BUY THE PROPERTY BY MATCHING, OR BETTERING, ANY OFFER THE OWNER MAY GET
FROM ANOTHER BUYER BEFORE THE PROPERTY CAN BE SOLD TO THAT OTHER BUYER. - Answer: RIGHT
OF FIRST REFUSAL
OFFERS CAN BE COMMUNICATED BY
______________________________________________________________. ALL OFFERS MUST BE
PRESENTED REGARDLESS OF HOW RIDICULOUS THEY MAY BE. ALL OFFERS SHOULD BE EVALUATED
BEFORE PRESENTING THEM TO THE SELLER. - Answer: PHONE, EMAIL, FAX, LETTER OR HAND DELIVERY
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