LESSON 7: PROMULGATED AGENDA, NOTICES, OTHER FORMS Flashcards
(61 cards)
What is the Sale of Other Property Addendum used for?
The Sale of Other Property Addendum is used when the buyer cannot purchase the new property unless their current property is sold and closed. This is typically when the buyer needs funds from the sale of their current property or when the new lender will not approve a loan without paying off the existing loan.
What is stated in Paragraph A of the Sale of Other Property Addendum?
Paragraph A gives a deadline for when the funds from the sale of the existing property must be received. It also states that “time is of the essence” for this addendum.
What does Paragraph B of the Sale of Other Property Addendum say about backup offers?
Paragraph B allows the seller to continue marketing the property for backup offers. If the seller accepts a backup offer, they must notify the first buyer (Buyer 1), who can either waive the contingency or the contract will terminate.
What does Paragraph D caution the buyer about?
Paragraph D cautions the buyer not to waive the contingency unless they are sure they can still close if the first property does not close, as waiving the contingency could result in default.
What is the purpose of the Addendum for Back-Up Contract?
The Addendum for Back-Up Contract allows the seller to negotiate with a second buyer (back-up buyer) in case the first buyer’s transaction falls through. This allows the back-up buyer to have a contract in place if the first contract terminates.
What does Paragraph A of the Addendum for Back-Up Contract state?
Paragraph A states that the back-up buyer will put up earnest money and option money and wait to see if the first contract terminates. If the first contract terminates, the back-up contract will become active.
What happens if the first contract does not terminate in the Addendum for Back-Up Contract?
Paragraph B states that if the first contract does not terminate by the deadline, the back-up contract will terminate and the earnest money will be refunded.
What does Paragraph C say about the back-up buyer’s rights?
Paragraph C states that if the first contract terminates, the seller must notify the back-up buyer immediately, and the effective date of the back-up contract will be amended to the date the back-up buyer is notified.
What does Paragraph D specify about the buyer’s termination rights?
Paragraph D specifies that if the buyer has the unrestricted right to terminate the Back-Up Contract, the right to terminate begins on the original effective date and continues after the amended effective date for the agreed number of days.
What does Paragraph E of the Addendum for Back-Up Contract say?
Paragraph E states that “time is of the essence,” meaning that deadlines must be strictly adhered to in the back-up contract.
What is the purpose of the Addendum for Reservation of Oil, Gas, and Other Minerals?
The Addendum for Reservation of Oil, Gas, and Other Minerals informs the buyer about the mineral rights related to the property. It includes an important notice that the mineral rights might affect ownership and that parties should consult an attorney if there are concerns about the mineral estate.
What does the “Mineral Estate” include?
The Mineral Estate includes oil, gas, and other minerals in and under the property, royalties, executive rights, exploration and development rights, and all related rights and benefits.
What is not included in the Mineral Estate?
The Mineral Estate does not include water, sand, gravel, limestone, building stone, caliche, surface shale, near-surface lignite, and iron, but it does include the reasonable use of these materials for mining, drilling, or mineral extraction.
What does Paragraph C of the Mineral Addendum address?
Paragraph C provides the seller with the option to reserve rights to enter the property to access the minerals. It also notes that if the seller does not own all the mineral rights, other parties might have the rights of entry.
What happens if the oil company damages the surface estate?
The surface owner can sue the oil company only if the damage is beyond what was reasonably necessary, if the company violated the accommodation doctrine, or if there was negligence.
What is the “Accommodation Doctrine”?
The Accommodation Doctrine requires the oil company to accommodate the surface owner’s use of the property when possible, unless there is no reasonable alternative.
What rights does the surface owner have in mineral leases?
The surface owner should negotiate provisions in the mineral lease to protect their interests, such as location of wells, restoration of the property after drilling, and inclusion of a liquidated damage clause for surface damages.
What is the Notice of Buyer’s Termination of Contract used for?
It is used when the buyer has the right to terminate the contract for specific reasons as outlined in the contract.
What is a mutual termination of contract?
A mutual termination occurs when both parties agree to release each other from the contract and are free from any liability.
What risks are involved in purchasing coastal property?
Purchasing property on the coast, especially near the Gulf Intracoastal Waterway, involves risks such as erosion, storms, and the state’s right to remove structures if they encroach on the beach area due to erosion.
What should purchasers do before buying coastal property?
Purchasers should research erosion rates, consult an attorney, and understand the risks before signing a contract for coastal property.
What are the benefits of buying a Beachfront Home?
Immediate access to the beach for activities like swimming, fishing, and family fun.
