ch.7 completing the residential purchase agreement

real estate

The Residential Purchase Agreement includes:
A. The price the buyer offers to pay the seller.
B. All of the answers are correct
C. Closing costs.
D. Insurance fees.

A. The price the buyer offers to pay the seller.

Which of the following is true regarding arbitration in a RPA contract?

A. Its not a binding decision

b. it is a binding decision

c. it is up to the parties on whether its binding or not

d. none

b. it is a binding decision

Unless otherwise instructed, funds received must be delivered to the escrow holder:
A. The same day after acceptance of the offer.
B. Thirty (30) days after acceptance of the offer
C. Five (5) days after acceptance of the offer.
D. Three (3) business days after the acceptance of the of the offer.

D. Three (3) business days after the acceptance of the of the offer.

Which of the following are considered natural hazard zones?
A. Earthquake zones.
B. All of the answers are correct.
C. Flood zones.
D. Fire zones.

B. All of the answers are correct.

The Homeowners' Guide to Earthquake Safety booklet is:
A. Requires the owner to disclose any known seismic deficiencies.
B. All of the answers are correct.
C. Applies to structures built before 1960.
D. Used for conventional light frame construction structures.

B. All of the answers are correct.

Which of the following are NOT considered contingencies in the Residential Purchase Agreement (RPA)?
Correct!
A. All of the answers are correct.
B. Obtaining the down payment.
C. Obtaining closing costs.
D. Obtaining the deposit.

A. All of the answers are correct.

Unless otherwise stated, the loan contingency is to be removed within:

17 calendar days

. If the residential property was constructed before 1978, the seller must provide the buyer with a(n):

a. lead-based paint notice.
b. latex-based paint notice.
c. historic landmark notice.
d. blighted neighborhood notice.

a. lead-based paint notice.

The close of escrow is:

the day of recording

Which of the following are NOT considered contingencies in the Residential Purchase Agreement (RPA)?
Correct!
A. All of the answers are correct.
B. Obtaining the down payment.
C. Obtaining closing costs.
D. Obtaining the deposit.

A. All of the answers are correct.

The following buyer activities are usually contingencies of the transaction except:
A. Final Verification of Condition of Property.
B. Obtaining Financing.
C. Selling their existing home.
D. Appraisal of the Property.

A. Final Verification of Condition of Property.

According to the California Residential Purchase Agreement and Joint Escrow Instructions (RPA-CA), mediation is required regardless of whether which parties agree to arbitrate or not?
A. Brokers.
B. Buyers
C. Sellers
D. All of these answers are correct.

D. All of these answers are correct.

Broker compensation is specified in:
A. A separate written agreement.
B. The Allocation of Costs form.
C. The purchase agreement.
D. The contingency removal document

A. A separate written agreement.

Before a Seller can exercise any right to cancel, they must provide the buyer with:
Correct!
A. An Notice to Buyer to Perform (NBP) form.
B. An Extension of Time Amendment (ETA) to close escrow.
C. A Title Insurance Disclosure (TID) form.
D. An Agency Disclosure (AD) form.

A. An Notice to Buyer to Perform (NBP) form.

Which of the following is NOT true about the date for Closing of Escrow?
A. The parties can choose a specific date for the close of escrow.
B. Close of escrow is limited to 30 days.
C. If agreed to, escrow may close based on a certain number of days after the offer is accepted.
D. All of these answers are correct.

B. Close of escrow is limited to 30 days.

If the appraisal does NOT match the purchase price the lender will demand the down payment and loan amount:
A. Will be based on the MLS asking price.
B. Will be based on the appraisal value.
C. Will be disregarded.
D. Will be based on the purchase price.

B. Will be based on the appraisal value.

According to the Time Period (14.A) Section of the RPA, the seller has seven days to provide the buyer with:
A. Natural hazard zone disclosures.
B. Lead-based paint disclosures.
C. Mandatory government reports.
D. All of these answers are correct.

D. All of these answers are correct.

After the inspection of the property, preferably by a professional the buyer may do all of the following, EXCEPT:
A. Cancel the agreement.
B. Sue the broker for wasting his or her time.
C. Request the seller to make repairs.
D. All of these answers are correct

B. Sue the broker for wasting his or her time.

When purchasing a property in "As-Is" condition all of the following are true EXCEPT:
A. The seller is not obligated to repair defects that exist as of the date of acceptance.
B. The buyer is purchasing the property in its existing condition on the date of acceptance
C. The seller is responsible for maintaining the property in the condition it was in at the time of acceptance.
D. The seller does not have to disclose known material facts.

D. The seller does not have to disclose known material facts.

The seller must disclose to the buyer if any insurance claims affecting the property have been filed within the past:
A. Ten (10) years
B. One (1) year.
C. Three (3) years.
D. Five (5) years.

D. Five (5) years.

The default time period in the RPA to remove an appraisal contingency is:
A. Before the time to remove the loan contingency.
B. After the time the remove the loan contingency.
C. The date of close of escrow.
D. On the same date as the loan contingency.

A. Before the time to remove the loan contingency.

For a" liquidated damages" clause to be included as an obligation in the RPA, if only the seller or the buyer initials it:
A. The contract is still valid, if witnessed by a notary public.
B. A counter offer is required until buyer and seller agree.
C. None of these answers are correct.
D. The mediation clause kicks in.

B. A counter offer is required until buyer and seller agree.

Paying for wood destroying pest (termite) inspection:
A. Is always the responsibility of the seller.
B. None of the above.
C. Is negotiable.
D. Is always the responsibility of the buyer.

C. Is negotiable.

Regarding Condition of the Property, the RPA specifies:
A. The seller warrants the plumbing, heating and roof.
B. The property is sold in it's "AS-IS" present condition.
C. The property is free of Lead, Asbestos and Mold.
D. A Pest Control Clearance must be provided.

B. The property is sold in it's "AS-IS" present condition.

Item 14 of the RPA designates time periods for :
Correct Answer
A. All of these answers are correct.
B. Notice to buyer or seller to perform
C. Cancelation Rights
D. Removal of Contingencies

A. All of these answers are correct.

The "Liquidated Damages" clause in the RPA:
A. May Limit the buyer's losses if they breach.
B. Applies to all residential transactions C. Refers to the buyer's liquid assets.
D. Pays the seller at least 3% if the buyer breaches.

A. May Limit the buyer's losses if they breach.

To be enforceable, a contract must be:
A. Accepted by all parties in its entirety.
B. Accepted by the seller only.
C. Accepted by the buyer only
D. Accepted by all parties if at least partially correct.

A. Accepted by all parties in its entirety.

In the RLA "Scope of Duty" clause broker and seller acknowledge and agree that the broker:
A. Does not decide what price buyer should pay or seller should accept.
B. Does not guarantee the performance, adequacy or completeness of inspections, services, products or repairs provided or made by the seller or others.
C. All of these answers are correct.
D. Does not guarantee the condition of the property.

C. All of these answers are correct.

Termite clearance is not mandated by law - but it may be required by:
A. The buyer.
B. The seller.
C. The escrow officer.
D. The lender.

D. The lender.

The seller must indicate in the RLA if the premises are occupied by tenants.
If the tenants have a valid lease:
A. The buyer need not be notified until after the sale.
B. They may remain in possession after the sale (correct box must be checked).
C. Their security deposits are kept by the seller.
D. They may be vacated after the sale.

B. They may remain in possession after the sale (correct box must be checked).

In the RPA, "Days After" means the number of calendar days after the occurrence of a specified event:
A. Applies only to Close of Escrow
Correct!
B. Not including the day of the event.
C. But must be a least 3 days.
D. Including the day of the event.

B. Not including the day of the event.

As stated in the RPA, the effect of buyer's removal of contingencies:
A. Eliminates stated contingencies.
B. Deems that buyer unable to complete the purchase.
C. Is not binding.
D. Entitles the buyer to a refund of their deposit funds.

A. Eliminates stated contingencies.

Arbitration is:
A. None of these answers are correct.
B. A. binding decision with no right to appeal.
C. More complicated than a conventional court proceeding.
D. Not binding.

B. A. binding decision with no right to appeal.

As an agent, when a buyer asks you how he or she should take title, you:
A. Should first get a signature on the purchase offer.
B. Should charge a fee for title advice.
C. Should never advise how to take title.
D. Are obligated to give your expert advice as to how to take title.

C. Should never advise how to take title.