Contract Law Part I-2 Flashcards Preview

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Flashcards in Contract Law Part I-2 Deck (26)
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1
Q

Acceleration Clause

A

A contract provision that allows a lender to require a borrower to repay all or part of an outstanding loan if certain requirements are not met.

2
Q

Addendum

A

A document attached to and made a part of the original contract. It can be explanatory, informational or indicate other requirements of the parties that aren’t clearly spelled out in the contract.

3
Q

Amendment

A

A document that makes a change to the ratified sales contract.

4
Q

Amortized Loan

A

Installment loan in which the monthly payments are applied first toward reducing the interest balance, and any remaining sum towards the principal balance.

5
Q

Appraisal

A

The process of valuing real property, using one of three approaches: cost approach, income capitalization approach, or sales comparison approach.

6
Q

Balloon Payment

A

The final installment of a loan to be paid in an amount that is disproportionately larger than the regular installment.

7
Q

Closing

A

The completion of a transaction involving the sale or exchange of real estate.

8
Q

Computer loan origination (CLO)

A

An electronic network for handling loan applications through remote computer terminals linked to various lenders’ computers.

9
Q

Contingency

A

A provision in a real estate contract that specifies the contract would cease to exist upon the occurrence of a certain event.

10
Q

Counteroffer

A

An offer made in response to a previous offer by the other party during negotiations for a final contract

11
Q

Deed of Trust

A

A type of secured real-estate transaction that some states use instead of mortgages.

12
Q

Earnest Money

A

A deposit made to a seller showing the buyer’s good faith in a transaction

13
Q

Exclusive Agency Listing

A

An agency agreement in which the seller reserves the right to sell the property on his or her own, without paying a commission to the agent.

14
Q

Exclusive Right to Sell Listing

A

An agency agreement under which a real estate agent has the sole right to sell a specified property.

15
Q

Land Contract

A

A contract between a seller and buyer of real property in which the seller provides financing to buyer to purchase the property for an agreed-upon purchase price and the buyer repays the loan in installments.

16
Q

Lease

A

A legal document outlining the terms under which one party agrees to rent property from another party.

17
Q

Mortgage

A

A debt instrument, secured by the collateral of specified real estate property, that the borrower is obliged to pay back with a predetermined set of payments.

18
Q

Net Listing

A

Listing in which the broker’s commission is the excess of the sale price over an agreed-upon (net) price to the seller; illegal in some states but not Texas.

19
Q

Offer to Purchase

A

A preliminary agreement, secured by the payment of earnest money, between a buyer and seller as an offer to purchase real estate.

20
Q

Open Listing

A

A property listing that uses multiple real estate agents to sell it; with an open listing, the agent that sells the property collects the commission.

21
Q

Option

A

An agreement in which one party buys the right to have the first chance of purchasing a piece of property at a specific price at some point in the future.

22
Q

Promissory Note

A

A written, signed, unconditional promise to pay a certain amount of money on demand at a specified time.

23
Q

Proration

A

The amount of or the act of determining a portion or share of a cost or benefit to be allocated between two parties.

24
Q

Rescission

A

The unmaking or termination of a contract between parties.

25
Q

Any sale of real estate that generates proceeds that are less than the amount owed on the property.

A

Short Sale

26
Q

Underwriter

A

Typically works for a lender to go over all the required paperwork and give the final approval for a loan.