REPC Flashcards

Questions and Answers

One exception to using the state approved REPC is:

When the client buys a form online

When a broker instructs otherwise

When the client's attorney drafts a contract (correct)

When the sales agent deems it appropriate

The agent's legal authority encompasses all of the following, except:

Drafting the contract (correct)

Drafting the terms of an addendum

Filling in the blank lines on the contract

Negotiating the transaction

In what form must the earnest money be delivered?

It's negotiable

How many days does the broker have to deposit the earnest money once it's received?

4 calendar days Signup and view all the answers

Which of the following is NOT included in the REPC as an included item?

Shelving Signup and view all the answers

Water shares are included in the sale unless otherwise stated.

True Signup and view all the answers

If the buyer presents an all cash offer, may he later finance the transaction without the seller's consent?

Yes. Section 2 gives the buyer the unilateral authority to change the financing of the transaction. Signup and view all the answers

Who pays for escrow/closing services?

Each pays their share. Signup and view all the answers

Section 5 discloses all the agents involved in the transaction.

False Signup and view all the answers

Under section 6, if the ALTA Homeowner's Policy is not available through the issuing agent, what occurs?

The seller is responsible for paying for the policy issued through a different title insurance agency selected by the buyer, or the seller agrees to pay for and the buyer agrees to accept the most recent version of the ALTA owner's policy of title insurance available. Signup and view all the answers

Which of the following is NOT something the seller needs to disclose under section 7?

Copy of the previous year's property taxes Signup and view all the answers

The seller has to provide all the disclosures in a hard copy and they can't be in electronic form.

False Signup and view all the answers

If the buyer wishes to cancel the REPC after their inspection of the property, how can they cancel the contract?

They have to give written notice before the due diligence deadline. Signup and view all the answers

If the buyer does not give notice about the appraised value before the appraisal deadline, then the buyer can do what?

File notice within 3 days of the transaction. Signup and view all the answers

What happens to the earnest money if a buyer fails to obtain the proper financing by the financing deadline and now cancels the contract?

The seller gets to keep any agreed upon earnest money as liquidated damages. Signup and view all the answers

The buyer and seller can opt to add additional earnest money to be due on the due diligence deadline.

True Signup and view all the answers

Which of the following is NOT a specific addenda that a buyer and seller can add to the REPC from section 9?

Earnest money receipt confirmation Signup and view all the answers

The property is sold 'as-is' without implied or expressed warranties of any kind, but the parties can agree to a home warranty plan.

True Signup and view all the answers

Who is responsible for the cost of mediation?

Seller and buyer split the cost. Signup and view all the answers

From the time of acceptance, the seller cannot do any of the following without written consent of the buyer, except:

Fill in nail holes in the walls Signup and view all the answers

If the seller defaults on the REPC, what are the remedies offered to the buyer?

Sue to enforce the REPC, sue for damages, or the seller has to give an amount equal to the earnest money. Signup and view all the answers

May attorney fees be awarded in mediation?

False Signup and view all the answers

May the buyer assign the REPC to a personally owned LLC without the seller's permission?

False Signup and view all the answers

All of the following are required for a cancellation notice of the REPC except:

The notice cites the reason for cancellation Signup and view all the answers

Which of the following is not required to adhere to the appraisal and finance deadline?

B&C only Signup and view all the answers

Which of the following is not a performance deadline in the REPC?

Seller disclosure Signup and view all the answers

May parties to the contract use an electronic signature to execute the contract?

False Signup and view all the answers

If the buyer defaults, the seller may do which of the following?

Keep the earnest money and sue for damages Signup and view all the answers

If the seller sues the buyer over an improper cancellation, who pays for attorney fees?

The losing party Signup and view all the answers

May a buyer assign the REPC over to his/her family trust?

Yes, even without the seller's permission Signup and view all the answers

In Washington, what standard of care did the courts decide that real estate agents are held to in drafting contracts?

Standards set for attorneys Signup and view all the answers

Why should drafting contracts be considered very serious business?

You are dealing with a client's contractual rights. Signup and view all the answers

As a general rule, when are you considered to be practicing law?

When you advise your clients on their contractual rights. Signup and view all the answers

What must agents be able to do to help safeguard a client's interests in a transaction?

They need to be well versed in the contract. Signup and view all the answers

What is mutual assent actually known as in the elements of a contract?

Offer and acceptance. Signup and view all the answers

Up to what time can you withdraw a unilateral offer?

When the performance begins. Signup and view all the answers

When does acceptance occur for the REPC?

When it is signed and communicated to the offeror. Signup and view all the answers

What happens to an offer after a counter offer is made?

The original offer is gone forever. Signup and view all the answers

Can an offer be revived after rejection?

False Signup and view all the answers

If there is a breach of contract, is the other non-breaching party released?

False Signup and view all the answers

How should an agent present multiple offers to a client?

All offers must be presented in a timely manner and fair manner. Signup and view all the answers

What does tender mean in terms of a contract?

Present an offer. Signup and view all the answers

An offeror is always the buyer and the offeree is always the seller.

False Signup and view all the answers

Susan wanted to buy Ray's prized coin collection, but she knew he would never sell it. Can she force the sale of the coin collection?

No, Ray had no intention to be bound to that agreement. Signup and view all the answers

If Sally makes an offer to Jenny, and Jenny wants to make a counteroffer, what is wrong with this situation?

Nobody can change the language of the REPC, because that is illegal to do in a counter offer. Signup and view all the answers

Study Notes

REPC Exceptions & Authority

A state-approved REPC is not used if the client's attorney drafts a contract.
An agent's legal authority includes filling in blanks but excludes drafting the entire contract.
Earnest money can be delivered in any negotiable form.
Brokers have 4 calendar days to deposit earnest money once received.

Included Items & Water Shares

Shelving is not included in the REPC.
Water shares are automatically included in a sale unless expressly excluded.

Financing & Escrow

A buyer can finance a previously all-cash offer without needing seller consent.
Escrow and closing service fees are shared between buyer and seller.

Disclosures & Notices

Section 5 confirms agency relationships but does not disclose all agents in a transaction.
Under Section 7, sellers need to disclose lease agreements, environmental issues, and title commitments but not previous year’s property taxes.
Sellers can provide disclosures electronically.

REPC Cancellation & Performance Deadlines

Buyers can cancel the REPC post-inspection by giving written notice before the due diligence deadline.
If the buyer misses the appraisal notice, they can file notice within 3 days.
Earnest money is forfeited to the seller if the buyer fails to secure financing by the deadline.
Additional earnest money can be agreed upon by the buyer and seller before the due diligence deadline.

Addenda & Contract Terms

Not all addenda are allowed, e.g., earnest money receipt confirmation is not a specific addendum.
Properties can be sold "as-is," but home warranty agreements can be negotiated.

Mediation & Agency Assignments

Both seller and buyer share mediation costs.
Unilateral defaults by buyers allow sellers to sue for damages and retain earnest money.
Buyers can assign the REPC to an LLC without seller's permission.

Legal Standards & Contract Management

In Washington, real estate agents drafting contracts must meet the same standards as attorneys.
Drafting contracts is crucial as it affects clients' contractual rights; thus, agents must understand contract details.
Mutual assent involves offer and acceptance, and an offer can be withdrawn before performance begins.

Offers and Counteroffers

Acceptance of the REPC is complete upon signature and communication to the offeror.
A counteroffer nullifies the original offer, and offers can only be renewed if both parties agree post-rejection.
Breaching a total contract releases the non-breaching party, while a partial breach does not.

Presenting Offers & Tendering

Agents are obligated to present all offers to clients promptly and fairly.
"Tender" refers to the act of presenting an offer in a contractual context.

Misrepresentation & Legal Implications

The offeror and offeree roles are determined by who makes or receives the offer, not fixed by buyer/seller labels.
Contracts lacking mutual intent (e.g., signed under false pretenses) may not be enforced.
No individual can change the language of the REPC; doing so is illegal in counteroffers.

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Description

Test your knowledge of the Real Estate Purchase Contract (REPC) with these flashcards. This quiz covers essential concepts such as exceptions to using the REPC and the legal authority of agents. Perfect for real estate professionals seeking to reinforce their understanding.