Purchase Contracts

Which of these is a provision in a contract stating that certain conditions must be met if the contract is to be performed?

• rider

• express contract

• counteroffer

• contingency

When it comes to a sales contract, a license holder should do all of the following EXCEPT:

• help a client keep on top of deadlines expressed in it

• give legal advice about it

• fill in all the blanks

• explain its language and provisions

Jamie, a buyer's agent, is pretty sure that the listing agent will receive multiple offers on a home. Should Jamie include an escalation clause in his offer?

• Absolutely, an escalation clause has very little risk

• Maybe, an escalation clause works especially well if the buyer is willing to pay more than their upper limit

• Maybe, a multiple off situation does suggest that an escalation clause might be useful

• No, an escalation clause should only be used in a buyer's market

Alan, a broker in Georgia, conducts a closing of a real estate transaction. He also makes sure that all parties get a copy of the closing statement. Evaluate his actions.

• It is fine that Alan conducted the closing. However, it was not his responsibility to distribute copies of the closing statement.

• It is fine that Alan conducted the closing, and that he distributed copies of the closing statement.

• Alan should not have conducted the closing. It was also not his responsibility to distribute copies of the closing statement.

• Alan should not have conducted the closing. However, it was his responsibility to distribute copies of the closing statement.

If a buyer wants to show good faith, they can di it by presenting the seller with:

• a counteroffer

• lawful objective

• consideration

• earnest money

Which of these is a phrase used to communicate when a party to a contract must perform their contractual duties by a specific date and time in order to avoid a breach of contract?

• constructive eviction

• express contract

• time is of the essence

• caveat emptor

A sales contract states, "The Offer set forth herein expires on the 3rd day from delivery." Explain this clause.

• If the offeree does not accept the offer before that time, then the contract is null and void

• This is the "time is of the essence" clause

• Expiration is contingent on the due diligence, so if the buyer has not done that before that time, then the contract is null and void.

• If the offeror doesn't make a new offer before that time, then the contract is null and void.

A legal description in a sales contract MUST:

• include photographs of the property

• include a list of all renovations that have taken place on the property

• describe a property in a precise and distinct manner

• match the address on record at the post office

What is right of first refusal?

• a contract that has not been put into words, but is implied through the parties' actions

• a right that grants a landlord the ability to evict a tenant for any reason

• a law which requires certain types of contracts to be in writing and signed by all parties who are bound by the contract

• the right of a party to be the first one to have the opportunity to buy or lease a property, if the owner decides to sale or lease the property

Cody, a broker in Georgia, is helping his client understand a purchase agreement. The client wants Cody to advise him about the legal consequences of defaulting. What should Cody say?

• Cody should simply tell the client what he knows.

• Cody should refer the client legal counsel. It is against the law for a license holder to give legal advice.

• Cody should preface any answer with, "I'm not a lawyer, but..." and then attempt to answer the client's question

• Cody should refer the client to legal counsel. In addition, it should be an attorney who fills in the blanks of the contract, not Cody.