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WV Real Estate Exam 7- End > Unit 11- Real Estate Contract > Flashcards

Unit 11- Real Estate Contract Flashcards

1
Q

A contract

A

An offer and acceptance, bound by consideration(money), between legally competent parties and for legal purposes

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2
Q

Unilateral contract

A

One person bound to act

Optionor is bound to act

Person giving bound to act

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3
Q

Executed

A

Commission paid

Done contract

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4
Q

Executory

A

Waiting for the contact to be executed

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5
Q

Offer and acceptances

A

Agreement on purpose and term

Must be in writing due to statute of frauds

No deviation from original contract

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6
Q

Statute of frauds

A

Must be in writing

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7
Q

Statute of limitations

A

Time restrictions

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8
Q

Reality of consent

A

Awareness of knowing what your doing

Voidable

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9
Q

Voidable

A

Could go either way

Seems valid, but upon further investigation, someting wrong

16year old signing , not of legal age

Mental illness/age/fraud

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10
Q

Legally competent parties

A

Must be of legal age

Of right mind

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11
Q

Void

A

Contract not valid

Lacks 4 points to make it valid

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12
Q

Valid contract

A

Offer and acceptance
Bound by consideration.
Competent parties
Legal

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13
Q

Unenforceable

A

Not in writing

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14
Q

Discharge of contracts

A

Performence of contract- time is of the Essence - not making an acceptance in a matter of time

Assignment- new person to take over. Transfer rights to a third party

Breach of contract

Novation- sub new contract for old contract

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15
Q

Assignment

A
  • new person to take over.

Transfer rights to a third party

Sublease

Substitute people

All contract are assignable by law unless noted

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16
Q

Novation

A
  • sub new contract for old contract
17
Q

Cancellation

A

Canceled contract

Terminates contract with out return to original position

18
Q

Rescission

A

Returns to original position

Ernest money returned

19
Q

Land contract syn

A

Contract for deed / installment contract/ owner financing/ rent to own

20
Q

Contract forms

A

RE agents don’t practice law

Preprinted forms

21
Q

Sales contract

A

Contains the offer between buyer and seller

Sakes price and terms
Legal description
Title evidence 
Title condition 
Statement of terms agreed on
Contingencies
22
Q

Destruction of premises

A

WV law says seller responsible for any loss before closing

Executory stage

23
Q

Liquidated damages

A

Ernest money serves liquidated damages. Decide not to buy house for no good reason. Must be stated

24
Q

Proper sale contingency

A

Protect buyer from owning two house

I’ll buy this house when mine sells

25
Q

Escape clause

A

Continue to market property until contingency are done

Can continue to take offers

26
Q

Specific performance

A

Buyer or seller can sue to enforce term if one party backs out

27
Q

Consumer financial protection

A

Lender must

Show billing info writing 
Give 2 month warning for ARM rate change 
Promptly credit borrowed payment 
Respond quickly about payoffs
Not charge for insurance that we don’t need
Resolve complaints in 30-45 days
Customer service 
Trouble making payment help
Allow review of loan workout request
28
Q

Homeowner insurance

A

Basic and broad forms

Broad covers more and is more expensive

Basic - fire and lighting
Glass breakage
Windstorm and hail
Explosion 
Riot
Airplane 
Vehicle 
Smoke
Vandalism 
Theft
Broad
Snow damage 
Tree
Collapse of building
Hot water system 
Overflow of water
Freezing of plumbing 
Injury to electronics
Egg
29
Q

Co insurance clause

A

Maintain 80% of replacement cost of dwelling

Cover 80% of home

30
Q

Flood insurance

A

Flood prone area need insurance. Federal
FEMA

Effective 30 days after purchase

Not covered:
Pools
Animals 
Underground systems 
Any unnatural floods
31
Q

Rent or buy

A

Housing affordability and current mortgage insurance rates

32
Q

PITI

A

Principal
Insurance
Taxes
Interest

33
Q

Debt to income

A

28% with no expenses

36% with expenses

34
Q

Hypothecation

A

Mortgage secured by real property

Deed of trust

35
Q

CLUE

A

Comprehensive loss underwriting exchange

Insurance company data base in claims

WV Real Estate Exam 7- End (15 decks)

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