Arkansas Real Estate License FREE Arkansas Real Estate License Real Estate Contracts Questions and Answers 2

Question 1

Under Arkansas law, what happens to earnest money if the buyer defaults on a real estate contract without a valid contingency?

Accepted Answer

The earnest money may be retained by the seller as liquidated damages

Answer

The earnest money is automatically returned to the buyer

Answer

The earnest money is held indefinitely by the broker

Answer

The earnest money is split equally between buyer and seller

Question 2

Which of the following is required for a valid real estate contract in Arkansas?

Accepted Answer

Consideration, offer, acceptance, and legal capacity of the parties

Answer

Verbal agreement witnessed by two people

Answer

Notarization by an Arkansas notary public

Answer

Approval by the Arkansas Real Estate Commission

Question 3

In Arkansas, what is the primary purpose of a due diligence period in a real estate purchase contract?

Accepted Answer

To give the buyer time to inspect the property and review disclosures

Answer

To allow the seller to find a replacement property

Answer

To permit the listing agent to market the property to backup buyers

Answer

To allow the title company to record the deed

Question 4

What does the Arkansas Statute of Frauds require regarding real estate contracts?

Accepted Answer

Real estate contracts must be in writing and signed by the party to be charged

Answer

All real estate contracts must be oral agreements

Answer

Contracts are valid only if recorded with the county clerk

Answer

Real estate contracts require approval from a licensed attorney

Question 5

A buyer submits a counteroffer on an Arkansas property. What is the legal status of the original offer?

Accepted Answer

The original offer is terminated and replaced by the counteroffer

Answer

The original offer remains valid alongside the counteroffer

Answer

The original offer is automatically extended by 30 days

Answer

Both offers are binding until the seller chooses one

Question 6

In an Arkansas real estate transaction, which clause allows a seller to continue marketing the property while a buyer's contingency is pending?

Accepted Answer

Kick-out clause

Answer

Acceleration clause

Answer

Defeasance clause

Answer

Habendum clause