Contracts & Agency Flashcards
6 cards from real Real Estate practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Contracts & Agency flashcards as text
A purchase and sale agreement becomes binding when:
Answer: Both parties sign and communication of acceptance is received
A contract is formed upon mutual assent, meaning both parties must sign and acceptance must be communicated back to the offeror.
'Time is of the essence' in a real estate contract means:
Answer: All deadlines in the contract are strictly binding
A 'time is of the essence' clause makes all dates and deadlines in the contract strictly enforceable; missing a deadline constitutes a material breach.
A right of first refusal gives a party the:
Answer: Opportunity to match any offer before the property is sold to another
A right of first refusal requires the owner to offer the property to the holder of the right before accepting any third-party offer.
Assignment of a real estate contract transfers the:
Answer: Contractual rights and obligations to a third party
Assignment allows the original contracting party to transfer their rights under the contract to a third party, though the assignor may remain liable.
A bilateral contract in real estate is one where:
Answer: Both parties make promises to each other
A bilateral contract involves mutual promises — both parties are legally obligated to perform, as in a typical purchase and sale agreement.
Liquidated damages in a real estate contract are:
Answer: A pre-agreed amount payable upon breach, often the earnest money
Liquidated damages clauses specify in advance the remedy for breach (commonly the earnest money deposit), avoiding lengthy litigation to calculate actual damages.