Real Estate Unit 11*

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37 Terms

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Amendment

Can be used to alter the terms of a preprinted contract during the negotiation of the sale or to include additional items after the contract has been signed by the parties.

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Assignment

Refers to the transfer of rights or duties under contract.

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Bilateral Contract

Both parties promise to do something in exchange for another.

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Breach of Contract

When one party fails to perform their obligations as specified in a contract.

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Consideration

Something of value exchanged between parties in a contract.

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Contingencies

Conditions that must be met for a contract to become binding, often related to financing or inspections in real estate transactions.

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Contract

A legally binding agreement between two or more parties that outlines their rights and obligations.

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Counteroffer

A response to an offer in which the terms are modified, resulting in a new offer that can be accepted or rejected.

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Disclosure

The act of revealing pertinent information related to a property, often required by law, to ensure that buyers are fully informed before purchase.

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Duress

The use of threats or coercion to compel someone to act against their will, often invalidating agreements.

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Earnest Money

A deposit made by a buyer to demonstrate serious intent to purchase a property, which is held until the transaction is completed or cancelled.

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Enforceable Contract

A legally binding agreement that meets all essential elements, allowing parties to enforce the terms through legal action.

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Executed Contract

A contract that has been fully performed by all parties involved, with all terms fulfilled and obligations completed.

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Executory Contract

A contract that has not yet been fully performed; obligations remain to be completed by one or both parties.

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Express Contract

A contract where the terms are clearly stated, either verbally or in writing, outlining the obligations of all parties involved.

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Fraud

Intentional deception or misrepresentation that leads another party to part with something of value.

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Implied Contract

A contract formed by the actions or conduct of the parties involved, rather than written or spoken words. It implies that the parties have an agreement based on their behavior.

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Land Contract

A type of real estate agreement in which the buyer makes payments directly to the seller, who retains legal title until the full purchase price is paid.

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Liquidation Damages

A pre-determined amount of money that must be paid as damages for breach of contract, designed to simplify the process of estimating loss.

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Misrepresentation

The act of providing false or misleading information during a transaction, which can affect a party's decision to enter into a contract.

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Mistake of fact or law

When one or more parties have an erroneous belief about a fundamental fact or the law that affects the agreement. This can lead to a contract being voidable.

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Novation

The replacement of an old contract with a new one, effectively transferring the rights and obligations from one party to another while discharging the original contract.

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Offer and acceptance

A fundamental principle in contract law where one party proposes terms (offer) and the other party agrees to those terms (acceptance), resulting in a binding agreement.

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Option

A contract that gives one party the right, but not the obligation, to buy or sell a property at a predetermined price within a specified time period.

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Owner Financing

A financing method where the seller of a property provides direct financing to the buyer, allowing them to purchase the property without a traditional mortgage.

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Purchase Money Mortgage

mortgage where the buyer borrows money from the seller to purchase the property. This type of mortgage typically involves the buyer making regular payments directly to the seller.

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Rescission

The cancellation of a contract, returning both parties to their original positions as if the contract had never existed. This may occur due to mutual agreement, fraud, or other legal reasons.

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Statue of frauds

A legal concept requiring certain contracts, including real estate transactions, to be in writing to be enforceable.

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Suit for Specific Performance

A legal action to enforce the performance of a contract, typically seeking to compel a party to fulfill their contractual obligations in real estate transactions.

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Time is of the essence

A legal principle that requires timely performance of contractual obligations, emphasizing that deadlines must be met to avoid breach of contract.

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Undue influence

A form of coercion that occurs when one party takes advantage of their position of power over another party to unduly influence decisions or actions, often related to contracts or wills.

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Unenforceable contract

A contract that cannot be enforced by law due to various reasons, such as lack of capacity, illegality, or failure to meet required formalities.

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Unilateral Contract

A contract in which one party makes a promise in exchange for an act by another party, and only one party is legally bound to perform.

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Valid Contract

A legally binding agreement that satisfies all necessary legal elements, allowing for enforcement in a court of law.

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Void Contract

A contract that has no legal effect and cannot be enforced by either party due to the lack of essential elements.

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Voidable Contract

A contract that may be legally voided at the option of one party due to certain circumstances, such as misrepresentation or coercion.