Texas Promulgated Contracts Practice Test

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• Buyer Sarah is purchasing a residential property and plans to operate a daycare. How should her agent handle this?
• What is the consequence of not providing a seller's disclosure notice?
• What may the buyer be charged if the property changes use from its current agricultural exemption?
• Do all TREC promulgated contracts state that the Buyer is purchasing the property 'as-is'?
• Where is the commission agreement between the broker and the seller usually found?
• What is typically included in a payment schedule of a Texas promissory note?
• Why is it important for the Texas Real Estate Commission to standardize contracts?
• In the case of a dispute, what role does mediation serve?
• What is a "Listing Agreement" in real estate?
• Which of the following is an exception to a license holder using a TREC-promulgated contract form?
• What does the term "as-is" mean in a property sale?
• What term describes when a buyer assumes and agrees to pay the seller's existing mortgage?
• Under Texas law, what is a key feature of a short sale?
• What happens if the buyer does not meet the obligations associated with a loan assumption?
• Which alternative dispute resolution procedure is encouraged by the State of Texas?
• If a license holder receives compensation from a residential service company, how should it be handled?
• What is "specific performance" in real estate law?
• What is one of the primary functions of the Texas Farm Bureau?
• What is the statute of limitations for an oral agreement in Texas?
• What is "earnest money" generally used for in real estate transactions?
• For a valid option to exist, what must be true?
• What is the primary purpose of an "Inspection Addendum" in a real estate contract?
• If a property is under contract to a buyer, another buyer may use the __________________ to enter into a contract if the first contract fails to close.
• What condition occurs when a property is refinanced or resold immediately after purchase for an inflated value?
• What happens to earnest money if the contract is terminated due to buyer contingencies?
• What is the term for selling a home, with lender's consent, at a price less than the outstanding balance on a mortgage?
• When is a lease option typically executed?
• What is a lease option in real estate?
• What is a short sale transaction?
• What distinguishes a "buyer’s agent" from a "seller’s agent"?
• What does being within the extraterritorial jurisdiction of a municipality indicate?
• What is the Texas Association of Realtors (TAR)?
• A purchaser of property seaward of the Gulf Intracoastal Waterway must be given a disclosure notice that:
• A purchaser of property seaward of the Gulf Intracoastal Waterway must receive a disclosure notice about:
• The number of days allowed for objections to title or survey is:
• What is the "Option Period" in a real estate contract?
• Who is responsible for filling in the effective date of the contract?
• In a real estate contract, what does the term "closing" refer to?
• What is the role of a "listing agent"?
• If a licensee receives compensation from a residential service company, what must they do?
• When is the buyer entitled to possession of the property if not using a temporary lease?
• What is likely to happen in the absence of a "Mediation Provision" in a contract?
• What does "as is" mean in a real estate contract?
• How does a "Buyer's Agency Agreement" primarily benefit the buyer?
• Which of the following options is NOT a method for written notices to be considered effective?
• Who is required to notify about material changes to subdivision information?
• Which Texas agency oversees the regulation of real estate practices?
• What is defined as something given in exchange for a promise?
• Why is including a "Time is of the Essence" clause important in a contract?
• If a seller's property is supposed to be sold at a loss, what term describes this situation?
• When one party defaults under a contract, the other party is known as the?
• In which section of the TREC contract would you find information about the buyer’s right to terminate?
• Which activity is specifically prohibited under the Civil Rights Act of 1968?
• What does "TREC" stand for?
• What are "Due Diligence" activities in real estate transactions?
• What should a seller do if they wish to remain in the property beyond the closing date?
• What happens if a contract includes a clause to reserve a portion of mineral rights?
• In the Farm and Ranch contract, when can the seller generally harvest crops?
• What does TREC stand for in relation to Texas real estate?
• How is earnest money determined?
• The process of dividing ongoing expenses between the buyer and seller at the closing is called?
• What is the main purpose of the Seller's Temporary Residential Lease?
• What role does the Broker-Lawyer Committee have regarding TREC contract forms?
• What occurs if a property listing does not include a disclosure of defects?
• What is one restriction on real estate advertisements according to Texas law?
• What is a seller's disclosure notice, and why is it required?
• Which entity is responsible for promulgating real estate contracts in Texas?
• What is a "short sale" in real estate?
• When should a licensee advise a client to consult an attorney?
• Which of the following best describes the earnest money deposit?
• A federal disclosure requirement for residential properties built prior to 1978 is:
• If a seller wants to occupy the property for two days after closing, what should be used?
• If 50% is entered in the Addendum for Reservation of Oil, Gas, and Other Minerals, what does this mean for the seller?
• Which form is specifically used for the sale of unimproved property in Texas?
• A building or community must not discriminate based on familial status, unless it qualifies as housing for older persons. Is this statement true or false?
• What is the sales price in 3.C. always based on?
• What are considered accessories in the TREC contract?
• What is the consequence of damage or destruction of a property under contract prior to closing?
• What must be provided to buyers when selling a home built before 1978?
• What can be included in the special provisions paragraph of the contract?
• What does the term "closing" refer to in real estate transactions?
• What are the implications of an earnest money deposit being forfeited?
• What essential information must be included in a purchase contract?
• What must be disclosed to the buyer regarding property conditions before closing?
• If in Paragraph B(2) is checked, and 50% entered in the Addendum for Reservation of Oil, Gas, and Other Minerals, what does the seller reserve?
• The deed of trust securing seller financing is always assumable by a future buyer without approval:
• In Texas, how long does a buyer typically have to request repairs after an inspection?
• What does "FHA" stand for regarding loans?
• What might indicate that a licensee is guilty of the unlawful practice of law?
• What is the maximum allowable duration for a temporary residential lease form in Texas?
• What does the loan amount in Paragraph 3.B. of the sales contract include?
• What could be a consequence of failing to disclose property defects?
• What does it mean when a party in a contract is referred to as the "injured party"?
• Which term describes a property affected by a particular event that impacts its desirability?
• How many days does a seller have to provide the Seller's Disclosure Notice if a buyer makes an offer without it?
• Is it true that a buyer may have no cause of action against the original surveyor if an error is discovered using the Seller's existing survey?
• What is the role of the title company in a transaction?
• During the time between execution and closing/funding, a contract is classified as which type of contract?
• What does the "Residential Lease Agreement" promulgated by TREC represent?
• What is the purpose of the "Closing Disclosure" in real estate transactions?
• When is it inappropriate for a property seller to deny availability based on discriminatory practices?
• Who is responsible for paying an overage incurred due to a change order?
• When is earnest money typically deposited in a real estate transaction?
• What document must be provided to buyers concerning property insurance in Texas?
• Which of the following best describes "closing costs" in a real estate transaction?
• If a seller wants to continue to occupy the property for two days after the closing and the buyer agrees:
• When must exclusions to the sale be removed?
• Which of the following is considered a usual expense of the seller?
• TREC promulgated contracts allow the Buyer to have the property inspected:
• If a Seller agrees to contribute to the Buyer’s closing costs, how should the amount be documented?
• Who typically pays for the title policy in a real estate transaction?
• According to a Financing Addendum, the interest rate is:
• What is the main purpose of providing the lead-based paint pamphlet to buyers?
• What is meant by a ‘contract termination due to buyer contingencies’?
• What does the term "escrow" refer to in real estate?
• What is the purpose of the "Lead-Based Paint Disclosure"?
• What are liquidated damages in a contract?
• What does the "Notice of Default" signify in the foreclosure process?
• When should a licensee advise a party to consult an attorney?
• What is a "financing contingency" in a real estate agreement?
• What is the consequence if a buyer is found to be in default?
• Under what circumstance is a Seller's Disclosure Notice not required?
• In the Farm and Ranch contract, if the Sales Price varies by more than what amount based on a survey, either party may terminate the contract?
• What does the "Title Commitment" document indicate?
• What is the primary purpose of the Option Period in a TREC contract?
• In Texas real estate transactions, the option period is defined as:
• What does "closing" refer to in a real estate transaction?
• When is a Seller's Disclosure Notice not required?
• What is the main difference between "implied" and "express" agency in real estate?
• If the sales price may be adjusted based on a survey, which of the following is true?
• Can a buyer back out of the contract after the Option Period has ended?
• Which party initiates a Listing Agreement?
• What should an agent do if a buyer is concerned about environmental issues?
• Which of the following is NOT a standard form promulgated by TREC?
• Which document typically serves as proof of ownership in a real estate transaction?
• What is the significance of a title search in real estate transactions?
• What does a Property Insurance Disclosure inform buyers of?
• Which party is typically responsible for paying the title insurance in a real estate transaction?
• What is a key function of a title company in real estate transactions?
• When is the "Final Walk-Through" typically conducted?
• What must a broker acting as an intermediary obtain?
• When would rollback taxes most likely be imposed on a property?
• What should the buyer bring to the closing?
• What term describes a party that fails to perform according to the terms of a contract?
• What happens to the veteran Seller in a VA assumption?
• What typically occurs during the Option Period for the buyer?
• In a seller financing agreement, who is responsible for determining the interest rate?
• What risk related to property is highlighted for purchasers near the Gulf Intracoastal Waterway?
• How many days does a buyer typically have to send a request for repairs after an inspection?
• Which of the following is commonly included in a buyer's closing costs?
• What document ensures compliance with TRELA regarding advising buyers on title examination?
• When must exclusions to the sale be removed?
• What is a "counteroffer"?
• A new survey is always required for all transactions:
• If a buyer is allowed to select items in a new home under construction, can the seller reject a selection based on market value?
• What is typically required for a buyer to receive financing for a real estate purchase?
• What is the typical duration for an Option Period in Texas residential contracts?
• What information is crucial to include in a Closing Disclosure for transparency?
• In a contract, what may party B do if there are significant repairs needed that exceed a specified value?
• According to the Third Party Financing Addendum for Credit Approval of a VA loan, what happens if the purchase price exceeds the reasonable value of the property?
• What is the primary purpose of promulgated contracts in Texas real estate?
• A state government entity created to encourage agricultural development in Texas is the:
• What characteristic is essential for a legally binding contract?
• If an overage occurs on new home construction due to a change order, who is responsible for the excess payment?
• What is a short sale?
• What is the Lead-Based Paint Disclosure requirement for residential property?
• What is a common document used to disclose property conditions to potential buyers?
• In a Farm and Ranch sale, what item is typically NOT included in the sale?
• What does the term "earnest money" refer to in a real estate transaction?
• What does closing typically involve in a real estate transaction?
• At closing, what method of payment should the buyer use for the closing costs and down payment?
• What should an agent include in an offer for property where rare endangered species are present?
• Which component is not included in the definition of "accessories"?
• Where will reservations of oil, gas, and other minerals typically be inserted in the contract?
• If a buyer receives a disclosure notice for beach erosion, what should they be aware of?
• If the sales price is adjusted based upon a survey, either party may terminate the contract if the sales price varies by more than:
• What does the term "binding" refer to in the context of contingencies?
• What is the term for the process of dividing ongoing expenses like taxes and POA fees between the buyer and seller at closing?
• Land, improvements and accessories together are known as what?
• When can the Third Party Financing Addendum For Credit Approval be utilized?
• What is a key characteristic of "private mortgage insurance" (PMI)?
• What is the difference between "actual authority" and "apparent authority" in real estate agency?
• What is the name of the contract used for the sale of residential properties in Texas?
• How is the closing date determined?
• In the Farm and Ranch contract, if the sales price is adjusted based on a survey, what can be adjusted?
• Who negotiates the terms of the earnest money?
• Under what circumstance could a seller keep the earnest money?
• When are written notices between the parties considered effective?
• What does the term ‘property flipping’ refer to?
• The Buyer and Seller Temporary Residential Lease forms are good for any period up to?
• When is the T-47 Residential Real Property Affidavit typically completed?
• What is the interest rate in the Seller Financing Addendum determined by?
• Which type of advertisement can contain explicit references to preferred gender?
• The condominium resale certificate must have been prepared within how many months?
• What document would a landlord use to comply with Texas rental laws?
• What are the key components that need to be included in a Texas promissory note?
• What are items that a seller wishes to retain when selling a property called?
• Under what condition may a buyer terminate the contract and receive a refund of earnest money regarding lender required repairs?
• What is a "contingency" in a real estate contract?
• What is required when obtaining written consent from parties in a transaction?
• When is a seller required to provide a disclosure of property condition?
• What must occur for a real estate contract to be enforceable in Texas?
• Which of the following is a usual expense of the buyer as stated in the contract?
• How long does a buyer have to object to title defects disclosed in the survey?