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64 Cards in this Set
- Front
- Back
Meeting of the minds |
They must reach an agreement on all terms in the contract. The contract is formed at the instant that acceptance of an offer is communicated to the offeror. Therefore, a contract is formed on the acceptance of an offer and communication of the acceptance. |
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Consideration |
Is whatever is given in exchange for something else. |
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Two types of consideration |
Valuable consideration Good consideration |
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Statute of Frauds |
Requires that contracts conveying an interest in real property and contracts that are not performed within one year of the date created must be in writing and signed to be enforceable. |
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Enforceable contract |
Is a legally binding contract that the courts will recognize. |
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Contracts covered by Florida’s statute of frauds include |
Purchase and sale contracts Option contracts Deeds and mortgage instruments Lease agreements for a term longer than one year Listing agreements for a term longer than one year |
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Statute of limitations |
Designates the period of time during which the terms of a contract may be enforced. Written contracts-five years Oral contract-four years
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Oral Real Estate contract |
Is a valid contract in a few specific situations. If a buyer and seller verbally agree to a purchase and sale of real estate, and the buyer pays part of the purchase price and takes possession of the property or has made improvements to the property, the courts will recognize the contract. |
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Void contract |
Use of a forged name. |
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Voidable contract |
Minor contract. |
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Unenforceable contract |
Not in writing as required by the statute of frauds, because the statute of limitations has passed or because the property is destroyed. |
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Contracts in general |
Back (Definition) |
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Promissory note |
A formal contract. |
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Parol contract |
An oral agreement Informal contract |
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Executory Contract |
Is an agreement between parties that involves promises to be completed at a future date. Ex. Property owner contracts with a builder to construct a home on their lot. Terms are not fully yet performed. |
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Executed contract |
Exist when both parties have completed their obligations. Ex. At title closing, a real estate sale contract is executed. |
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Contract classifications |
Formal-in writing Informal-oral Bilateral-Both parties obligated Unilateral-One party obligated Express-in words Implied-by acts and conduct Executory-not yet fully performed Executed-completed all terms and conditions |
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Novation |
Agreement relieves the assignor from the liability to perform in a contract. The substitution of a new party and/or New terms to an exiting obligation. |
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Listing contract |
May be written, oral, or implied. However, listing agreements for a term longer than one year must be in writing to be enforceable under the statute of frauds. |
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Listing contracts |
Chapter 475 F.S. Requires Expiration date Description of the property Listing price and terms Brokers compensation Signature of all owners of record |
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Open listing |
One or more brokers |
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Open listing |
One or more brokers Only to broker who sells property |
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Conflicting demands |
Broker notify Frec in writing within 15 business days of receiving the conflicting demands. |
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Rental |
Provide receipt. It must state that a prospective tenant who does not obtain a rental is entitled to be repaid 75% of the fee paid if requested within 30 days of the contract/receipt date. If the information provided to the tenant is not current or is inaccurate the broker must repay 100% back to them. |
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Sherman Anti Trust Act |
Preserving competition and ensuring against restraint of trade. Two prohibited acts are pricefixing and market allocation “splitting up competitive market areas among themselves and not compete in each other’s area’s”. |
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Kickbacks |
Parties to the transaction must be fully informed. Buyer and seller must be informed.
Must not be prohibited by other law. |
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Sharing a commission |
It is unlawful to share a commission with an unlicensed person other than the seller or buyer. Florida law allows sharing with the seller and buyer as long as it is disclosed to all interested parties. Legal Kickback. |
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Vacancies of office |
If the only active broker of a brokerage corporation dies, resigns, is removed from office or is unexpectedly unable to remain in the position as active broker, the vacancy must be filled within 14 calendar days. Failure to appoint another active or temporary broker within the 14 days will result in automatic cancellation of the brokerage firm’s registration and the licensee’s, officer’s, director’s and sales associates will become involuntarily inactive. |
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Personal Assistant |
Back (Definition) |
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Personal assistant cannot |
Present an offer to the seller. Negotiate and prepare a listing contract with a property owner. |
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Conflicting demands |
Broker must notify the Frec in writing within 15 business days and must institute one of the settlement procedures within 30 business days of receiving conflicting demands. |
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Referral |
Florida law prohibits a real estate licensee from paying money to an unlicensed person for the referral of real estate business. |
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Executory contract |
Builder contract. Not yet finished. |
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Tax exemtion for blind |
If they make over $28,115.00 there is a tax exemption available. |
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Easement Appurtenant |
Allows an owner the use of an adjacent property. Involves two or more parcels of property and continues from owner to owner. |
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Easement in gross |
Benefits the company who owns it. Power poles |
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Easement by prescription |
Is acquired by continually using another person’s real property for the statutory period when each use is adverse to the owner’s interest. The easement is created after 20 years of open, continuous, uninterrupted use. |
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Superior liens |
Real Estate tax liens, which become a lien Jan 1st each year. Special assessment liens. Federal Estate tax lien. |
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Junior Lien |
Mortgage liens. Judgement liens. Vendor liens. Income tax liens. |
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Base line |
East West line |
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Metes |
Distance |
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Bounds |
Direction |
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Metes and bounds |
Oldest method of land description. |
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Township |
36 square miles |
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Lot and block |
Platvmap |
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Acre |
43,560 square feet |
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Mile |
5,280 in length |
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Check |
Square with each side measuring 24 miles. |
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Novation agreement |
Relieves the assignor from the liability to perform in a contract. |
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Enforceable contract |
Legally binding contract that the courts will recognize. |
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Exclusive agency listing |
Seller can sell property without paying commission. |
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Exclusive right of sale listing |
No matter who sells the broker gets the commission. |
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Lead based paint disclosure |
Sellers and landlords disclose to prospective buyers and tenants the presence of known lead-based paint in residential property built before 1978. Sale contracts and leases include a disclosure about lead-based paint. An EPA pamphlet regarding the danger of lead based paint be given to buyers and tenants before the sale or lease of residential property built before 1978. Sellers allow homebuyer a 10 day period during which to conduct an inspection for the presence of lead based paint. |
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Homeowners association disclosure |
Provide buyers with a disclosure summary regarding the association, the existence of restrictive covenants, and any assessments. |
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Property tax disclosure |
Buyers must be presented a disclosure summary concerning ad valorem taxes before or at the time of execution of the contract for sale. |
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Acceleration clause |
Allows the lender to call the entire loan balance due and payable. |
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Defeasance clause |
In a mortgage in Florida releases the mortgage lien once debt is paid in full. |
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Primary mortgage market |
Consists of lenders that originate new mortgage loans. |
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Fannie Mae 1938 |
Buys conventional, fha insured, va guaranteed loans. Largest secondary mortgage gse. Issues mortgage-back securities. |
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Freddie Mac |
Buys conventional mortgage loans. |
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S |
S |
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Doc stamps on deed |
.70 for each 100.00 of the full purchase price. |
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State doc stamp tax on promissory notes. |
.35 per 100.00 on the face value of the promissory note. The tax is entered as a debit to the buyer on the closing disclosure. |
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Intangible tax on New mortgages |
New loan amount x.002. |