#1
What does 'consideration' refer to in the context of real estate contracts?
Something of value exchanged for a promise
ExplanationValue exchanged for a promise.
#2
What does 'capacity' refer to in the context of real estate contracts?
The legal ability of parties to enter into contracts
ExplanationLegal ability to enter contracts.
#3
In real estate contracts, what is the purpose of 'earnest money'?
To demonstrate seriousness of intent to purchase
ExplanationShows intent to purchase.
#4
What does 'closing' mean in a real estate transaction?
The process of transferring ownership from seller to buyer
ExplanationOwnership transfer from seller to buyer.
#5
What is 'earnest money deposit' in a real estate transaction?
Money paid by the buyer to secure the purchase offer
ExplanationBuyer's money to secure purchase offer.
#6
Which of the following contracts requires all terms to be in writing to be enforceable?
Statute of Frauds Contract
ExplanationRequires written terms for enforceability.
#7
What type of contract is created when one party fails to perform as promised under a contract?
Breach of Contract
ExplanationResult of failure to fulfill promises.
#8
What is an 'option contract' in real estate?
A contract granting the right to purchase or lease property at a set price within a specified period
ExplanationRight to buy or lease at set terms.
#9
Which type of contract is based on the actions and conduct of the parties involved, rather than explicit agreement?
Implied Contract
ExplanationBased on actions, not explicit agreement.
#10
Which type of contract involves both parties making promises to each other?
Bilateral Contract
ExplanationMutual promises between parties.
#11
Which type of contract is enforceable by law but may have provisions that could allow one or more parties to be released from obligations?
Voidable Contract
ExplanationEnforceable but with release provisions.
#12
In real estate, what does 'specific performance' typically refer to?
The completion of a contract according to its exact terms
ExplanationExact term contract fulfillment.
#13
What is the key difference between a 'valid' and a 'void' contract?
A valid contract is enforceable by law; a void contract lacks essential elements and cannot be enforced.
ExplanationValid enforceable, void lacks essentials.
#14
What does 'time is of the essence' mean in a real estate contract?
Strict adherence to the time limits specified in the contract is required
ExplanationAdherence to specified time limits.
#15
In a real estate contract, what does 'liquidated damages' refer to?
A predetermined amount of damages agreed upon by parties in case of breach
ExplanationPredetermined breach damages.