Real Estate Contract Creation and Contingencies

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Questions and Answers

What is the role of unqualified acceptance in the creation of a contract?

  • It voids the contract
  • It secures the deposit amount
  • It grants the seller equitable title
  • It gives the buyer equitable title (correct)

What is the purpose of a deposit in a real estate contract?

  • To secure the validity of the contract and the buyer's interest (correct)
  • To determine the expiration date of the contract
  • To secure the validity of the contract and the seller's interest
  • To define contingencies

What do contingencies refer to in a real estate contract?

  • Liquidated damages claimed by the seller
  • Conditions that must be met before enforcing the contract (correct)
  • Specific performance obligations
  • The expiration date of the contract

What options does a seller have in case of a buyer default?

<p>Cancelling the contract, claiming liquidated damages, or suing for specific performance (A)</p> Signup and view all the answers

What recourse does a buyer have in case of a seller default?

<p>Cancelling or suing for damages or specific performance (C)</p> Signup and view all the answers

Who controls the deposit in a real estate contract?

<p>A disinterested party in accordance with escrow instructions (D)</p> Signup and view all the answers

What is one of the primary clauses that should be included in a contract for sale?

<p>Earnest Money (B)</p> Signup and view all the answers

In a contract for deed, what happens at the end of the term?

<p>Buyer pays off remaining balance and obtains legal title (D)</p> Signup and view all the answers

What is an important consideration in a contract option?

<p>How to exercise an option (B)</p> Signup and view all the answers

What recourse do buyers have in case of default in a contract for deed?

<p>Buyer may sue for cancellation and damages (B)</p> Signup and view all the answers

Which document should be included to ensure the validity of a contract for sale?

<p>Valuable Consideration and Signatures (B)</p> Signup and view all the answers

In a contract option, what happens if exercised by the optionee?

<p>The option becomes a bilateral sales contract (D)</p> Signup and view all the answers

What is the function of contingencies in a real estate contract?

<p>To ensure the validity of the contract (D)</p> Signup and view all the answers

In a real estate contract, what does unqualified acceptance of an offer by the buyer result in?

<p>Enforcement of specific performance (C)</p> Signup and view all the answers

What is the purpose of earnest money escrow in a real estate contract?

<p>To secure the validity of the contract and buyer's interest (C)</p> Signup and view all the answers

If a buyer defaults on their obligations under a real estate contract, what can a seller do?

<p>Claim liquidated damages or enforce specific performance (D)</p> Signup and view all the answers

What happens if a seller defaults on their obligations under a real estate contract?

<p>The buyer may sue for damages or specific performance (B)</p> Signup and view all the answers

Who controls the deposit in a real estate contract and is obligated to follow escrow instructions?

<p>A disinterested party (D)</p> Signup and view all the answers

What is a key feature of an executory contract?

<p>Must be fulfilled (D)</p> Signup and view all the answers

What is an essential element that should be included in a contract for deed?

<p>Title Evidence (A)</p> Signup and view all the answers

In a contract option, what is the purpose of recording the option?

<p>To make the option legally binding (A)</p> Signup and view all the answers

What is an important right that the buyer has in a contract for deed?

<p>The right to use, possess, or profit from the property (A)</p> Signup and view all the answers

What recourse does a seller have in case of buyer default in a contract for deed?

<p>Pursue litigation for specific performance or damages (B)</p> Signup and view all the answers

What does a non-refundable consideration for an option in a contract signify?

<p>It confirms the buyer's commitment to purchase within the option period. (B)</p> Signup and view all the answers

What must be fulfilled in an executory contract?

<p>Legal enforceability (A)</p> Signup and view all the answers

In a contract for deed, what is the buyer responsible for during the term of the agreement?

<p>Maintaining upkeep of the property (D)</p> Signup and view all the answers

What is an important provision in a contract for sale to ensure its validity?

<p>Legal description (C)</p> Signup and view all the answers

What is a common clause provision in a contract option?

<p>Forfeiture of option money (B)</p> Signup and view all the answers

In a contract for sale, what does 'primary clauses' typically refer to?

<p>Options and essentials (A)</p> Signup and view all the answers

What happens if an option in a real estate contract is exercised by the optionee?

<p>The option becomes a bilateral sales contract (B)</p> Signup and view all the answers

What must be met before a contract can be enforced?

<p>Contingencies (D)</p> Signup and view all the answers

Which party controls the deposit in a real estate contract?

<p>Escrow agent (A)</p> Signup and view all the answers

What does a buyer gain with unqualified acceptance of an offer?

<p>Power to enforce specific performance (C)</p> Signup and view all the answers

In a real estate contract, what is the purpose of the buyer's deposit?

<p>Ensuring validity of the contract (A)</p> Signup and view all the answers

If a buyer defaults on obligations under a contract, what can a seller do?

<p>Claim liquidated damages (C)</p> Signup and view all the answers

What happens if a seller defaults on their obligations under a real estate contract?

<p>Buyer may cancel the contract or sue for damages (A)</p> Signup and view all the answers

What does unqualified acceptance of an offer in a contract result in for the buyer?

<p>Gaining equitable title and the ability to seek specific performance (C)</p> Signup and view all the answers

What is the primary purpose of having contingencies in a real estate contract?

<p>To ensure certain conditions are met before enforcement (D)</p> Signup and view all the answers

If a seller defaults on obligations under a real estate contract, what recourse does the buyer have?

<p>Cancel the contract or sue for damages (B)</p> Signup and view all the answers

What is the function of earnest money escrow in a real estate contract?

<p>To secure the validity of the contract and buyer's interest (C)</p> Signup and view all the answers

What role does a disinterested party play in a real estate transaction?

<p>Handle the deposit and follow escrow instructions impartially (C)</p> Signup and view all the answers

In a real estate contract, what happens if a buyer defaults on their obligations?

<p>The seller has options like claiming liquidated damages or suing for specific performance (A)</p> Signup and view all the answers

What is a primary clause that should be included in a contract for deed?

<p>Price and Terms (B)</p> Signup and view all the answers

In a contract option, what is a common clause provision?

<p>Forfeiture terms (A)</p> Signup and view all the answers

In a contract for sale, what does 'validity' typically refer to?

<p>Valuable consideration (C)</p> Signup and view all the answers

What recourse does a seller have in case of buyer default in a contract for deed?

<p>Sue for specific performance or damages (C)</p> Signup and view all the answers

What is one of the key elements that should be met before a contract can be enforced?

<p>Valuable consideration (D)</p> Signup and view all the answers

What is an important right that the buyer has in a contract for sale?

<p>Maintaining upkeep of the property (A)</p> Signup and view all the answers

What is the purpose of contingencies in a real estate contract?

<p>To ensure conditions are met before enforcing the contract (D)</p> Signup and view all the answers

In a real estate transaction, who is obligated to act in accordance with escrow instructions?

<p>The disinterested party (B)</p> Signup and view all the answers

What happens if a seller defaults on their obligations under a real estate contract?

<p>The buyer may cancel or sue for damages (C)</p> Signup and view all the answers

Which party has options including cancellation, claiming liquidated damages or suing for specific performance if a buyer defaults in a real estate contract?

<p>The seller (A)</p> Signup and view all the answers

What does the unqualified acceptance of an offer in a contract result in for the buyer?

<p>The power to enforce specific performance (A)</p> Signup and view all the answers

What is the main function of earnest money escrow in a real estate contract?

<p>To secure both the validity of the contract and buyer's equitable interest (D)</p> Signup and view all the answers

What is one of the common clause provisions in a contract option?

<p>Non-refundable consideration for the option right (B)</p> Signup and view all the answers

In a contract for deed, what does the buyer generally hold during the term of the agreement?

<p>Equitable title (A)</p> Signup and view all the answers

What is a key element that should be included in a contract for sale to ensure its validity?

<p>Valuable consideration (A)</p> Signup and view all the answers

What happens at the end of the term in a contract for deed?

<p>Buyer obtains legal title (B)</p> Signup and view all the answers

What is one of the primary clauses that should be included in a contract for sale?

<p>Conveyed interest type (D)</p> Signup and view all the answers

In a contract option, what is the purpose of recording the option?

<p>To create legal enforceability (D)</p> Signup and view all the answers

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