Ch. 12 Real Estate Contracts Flashcards Preview

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Flashcards in Ch. 12 Real Estate Contracts Deck (34)
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1
Q

Addendum

A

any provision added to an existing contract that may change or be an addition to the content of the original/the addendum mentions the original contact and must be signed by all parties

2
Q

Amendment

A

change or modification to the existing content of a contract/must be separately initialed or signed by all parties

3
Q

Assignment

A

refers to a transfer of rights or duties under a contract

4
Q

Bilateral Contract

A

both parties promise to do something; one promise is given in exchange for another

5
Q

Breach of Contract

A

a violation of any of the terms or conditions of a contract

6
Q

Consideration

A

A contract must be based on consideration, something of legal value offered by one party and accepted by another as an inducement to perform or to refrain from performing some act

7
Q

Contingencies

A

Conditions that must be satisfied before a sales contract is fully enforceable (create a voidable contract)

8
Q

Contract

A

a voluntary agreement or promise between legally competent parties, supported by legal consideration, to perform (or refrain from performing) some legal act

9
Q

Counteroffer

A

any change by the seller to the terms proposed by the buyer

10
Q

Disclosure

A

Relevant information or facts that are known or should have been known/the act of revealing something

11
Q

Earnest Money

A

money deposit is evidence of the buyers intentions to carry out the terms of the contract in good faith

12
Q

Enforceable Contract

A

meets all the elements of a valid contract, including compliance w/any applicable statute of frauds or other law that requires it to be in writing and signed by the parties

13
Q

Executed Contract

A

One in which all parties have fulfilled their promises; the contract has been performed

14
Q

Executory Contract

A

when one or both parties still have an act to perform/ A sales contract is executory contract from the time it is signed until closing;ownership has not yet changed hands, and the seller has not received the sales price. At closing , when the contract terms have been met, the sales contract is executed

15
Q

Express Contract

A

the parties state the terms and show their intentions in words either oral or written

16
Q

Implied Contract

A

the agreement of the parties is demonstrated by their actions and conduct

17
Q

Land Contract

A

also called a contract for deed, contract of sale, a bond for title, installment contract, land sales contract, or articles of agreement for warranty deed, –under a typical land contract, the owner/seller retains legal title–seller is not obligated to execute and deliver a deed until the terms of the contract have been met

18
Q

Liquidated Damages

A

damages whose amount the parties designate during the formation of a contract for the injured party to collect as compensation upon a specific breach

19
Q

Novation

A

substitutes a new contract or party for the original

20
Q

Offer and Acceptance

A

The sales contract sets our the offer by the buyer that is accepted by the seller

21
Q

Option

A

contract by which an optionor (owner) gives an optionee (prospective buyer) the right to buy or lease the owners property at a fixed price within a certain period of time

22
Q

Owner financing

A

the seller provides credit for all or part of the funds that will allow the buyer to move forward with the transaction

23
Q

Purchase Money Mortgage

A

buyer receives equitable title to the property (once contract is executed) but places a security interest on it in favor of the seller

24
Q

Rescission

A

returns the parties to their original positions before the contract

25
Q

Statute of Frauds

A

Requiring certain contracts, such as real estate sales or lease agreements, to be in writing and signed to avoid fraud on the court by perjury and subornation of perjury, documents must be signed and dated

26
Q

Suit for Specific Performance

A

an action for damages, ordering one party to complete the performance promised in a contract

27
Q

“Time is of the Essence”

A

each of the elements of the contract must be performed within a specified time

28
Q

Unenforceable contract

A

may appear on the surface to be valid; however, neither party can sue the other to force performance
An oral agreement for the sale of a parcel of real estate would be unenforceable

29
Q

Unilateral contract

A

a one-sided agreement/one party makes a promise in order to entice a second party to do something

30
Q

Valid contract

A

meets all the essential elements that make it legally sufficient, or enforceable, and is binding in a court of law

31
Q

Void contract

A

has no legal force or effect because it lacks some or all of the essential elements of a contract

32
Q

Voidable contract

A

appears on the surface to be valid, but may be rescinded or disaffirmed by one or both parties based on some legal principle

33
Q

Equitable Title

A

the beneficial interest of a person whom equity regards as the real owner but the legal right (legal title) vest with another/insurable interest in the property

34
Q

Legal Title

A

perfected ownership interest that is enforceable by law