Chapter 10 Sales Contracts and Practices

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Author:
aribet
ID:
241074
Filename:
Chapter 10 Sales Contracts and Practices
Updated:
2013-11-06 20:14:05
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NC Real Estate Exam
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Description:
Modern Real Estate Practice in NC
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  1. 2 Items prohibited from any pre-printed offer to purchase
    Any discussion of brokerage compensation and any attempt to disclaim brokerage liability in connection with the transaction.
  2. Uniform Electronic Transactions Act
    Contracts can be created by electronic means such as e-mail and faxes.
  3. Offerer/Offeree
    Makes offer/Receives offer
  4. Acceptance
    Occurs when the offeree signs the offer without making any changes to it, thereby evidencing his acceptance and willingness to be bound by and perform all terms of the offer.
  5. Mailbox rule
    If an acceptance is placed into the mail service to the other party it is considered as having been delivered when mailed, not when received.
  6. Termination of Offers (5)
    • -If offeree rejects the offer or creates counteroffer
    • -If offer is not accepted by specific time or within reasonable time
    • -If the offeror revokes prior to acceptance
    • -by death of either party
  7. Earnest money must be deposited in a trust account within ___ days of contract formation.
    3
  8. Effective Date
    The date the contract was formed, when the last offeree to sign the offer or initial the last change communicates this action to the last offeror.
  9. Due Diligence
    • -Credited to purchase price if the buyer proceeds to settlement
    • -During due diligence the buyer is encouraged to secure financing and negotiate any repairs or changes in contract terms the buyer deems necessary.
  10. 2 ways Due Diligence is refundable
    A material breach by the seller or material damage or destruction of the property improvements prior to closing.
  11. Real estate agents are obligated to disclose ALL offers to sellers immediately, but no later than ___ days from the date of the offer.
    5
  12. How do you handle multiple offers?
    • If one of the offering parties is notified of the existence of a competing offer, then all offering parties must receive the same notification.¬†Level Playing Field.
    • NCREC prohibits any broker from disclosing the price or any other material term in any offer to purchase, sell, lease, rent, or option to a competing party without the express authority of the offeror.
  13. Furnishing copies of offers and contracts to buyer and seller
    Real estate agents must provide all parties with a copy of any instrument they sign at the time of execution or no later than five days after execution.
  14. Installment Land Contract
    • A sales contract and a financing document for owner-financed purchases.
    • Seller's advantages include a tax benefit, earned interest, and selling feature.
    • Buyer can overcome poor credit, and income-producing property can help pay for itself.
  15. Conventional Option
    • Optionor gives an optionee the irrevocable right to buy or lease the owner's property at a fixed rate within a stated period of time.
    • 2 considerations: option fee, agreed on sales price when option exercised.
  16. Right of first refusal
    created when a property owner promises to give the contracting party the first chance to buy the property or to match the bonafide offer of a third party, should the owner decide to sell sometime in the future.
  17. Right of first opportunity to purchase
    a preemptive right agreement that endeavors to avoid some of the vague legalities of the right of first refusal.

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