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Contracts
Types of contracts; essential elements; breach of contract; analysis of listing and sales contract; options; leases; property management.
69
Real Estate & Planning
Professional
05/22/2012

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Cards

Term
Contracts
Definition
Express Agreements between two or more parties who agree to do or not to do some act.
Term
Consideration
Definition
Something of value exchanged that the party receiving it deems sufficient but actual worth is not important.
Term
Valuable Consideration
Definition
Money
Term
Good Consideration
Definition
Love and Affection
Term
Misrepresentation
Definition
an innocent misstatement of fact without intent to deceive
Term
Fraud
Definition
Intentional deception in which injured party has loss
Term
Undue Influence
Definition
A mixture of fraud and force by taking unfair advantage of another because of the relationship of the parties
Term
Duress
Definition
unlawfully forcing someone to do something (sign) againt their will
Term
Valid
Definition
contains all essential elements and by its terms is legally binding on all parties
Term
Void
Definition
Has forms and words of a contract but is not legally binding by its terms; EX: a contract to commit an illegal act
Term
Voidable
Definition
Under 18 yrs, mentally incompetent or intoxicated. Party is not legally competent: lacks capacity and contractual ability. (Fraud or Duress) may seek court order to void contract
Term
Unilateral
Definition
One party promises to do something upon the completed act of another which is not promised absolutely to occur. (Seller promises to pay a commission to broker IF agent manages to sell the property.
Term
Bilateral
Definition
Two parites simultaneously exchange promises, as when seller promises to sell and buyer promises to buy. (Purchase and Sales Agreement)
Term
Executory
Definition
Signed agreement, but not yet closed
Term
Executed
Definition
A contract is closed. When deed is delivered, the provisions of P&S (sales contract) merge into deed.
Term
Assignment of Contract
Definition
A party may transfer his rights to another party. Old party = assignor. New = assignee
Term
Power of Attorney
Definition
written power of attorney creates an attorney-in-fact has authorization to sign a contract of behalf of one of the parties. 
Term
Amendment
Definition
Any changes to the contract. signnitures of initials to changed conditions on sales contract.
Term
Abandonment
Definition
Tenent leaves without permission before lease expires. 
Term
Acceptance
Definition
indication by signiture of offeree that he is willing to be bound by the terms of offer from offerer
Term
Actual Eviction
Definition
Legal action originated by lessor where tenent is ousted by result of court order
Term
Adjustments
Definition
rents, insurance, fuel, taxes ETC. apportioned or prorated between buyer and seller at closing of title
Term
Affidavit
Definition
a sworn statement; written oath such as acknowledgment
Term
Affirmation
Definition
a solemn declaration; non-religious oath (verbal)
Term
Agreement of Sale
Definition
a bilateral contract whereby buyer promises to buy and seller promises to sell by exacution and delivery of deed; also known as Purchase and Sale Agreement. Agreement=Contract
Term
Binder
Definition
Deposit or earnest money given as evidence of good faith by buyer to secure property until sale is consumated; in insurance, it is memorandum of temporary coverage at passing of papers until formal policy is issued later
Term
Bona Fide
Definition
In good faith and without fraud
Term
Breach
Definition
Default or violation of terms of contract
Term
Capital Expenditures
Definition
investments of cash for improvements to remain competitive in a business (roof)
Term
Cash Flow
Definition
profit after principal and interest are deducted from net operating income (NOI)
Term
Collusion
Definition
agreement between parties to defraud another
Term
Conditional Sales Contract
Definition
a contract in which owner retains title until buyer has met all terms and conditions. Also called land contract or installment contract. aquires equitable title and until final payment; delivery of deed, buyer has "legal title"
Term
Damages
Definition
estimated monetary damages for breach of contract
Term
Default
Definition
non-performance of duty under a contract
Term
Demise
Definition
to lease
Term
Earnest Money
Definition
deposit or binder given with Agreement to Buy
Term
Ejectment
Definition
Legal Action to regain possession of realty with damages payable for its unlawful retention.
Term
Eviction
Definition
the depriving of a person's possession of realty
Term
Forcible Entry
Definition
legal action to recover possession of premiese unlawfully held
Term
forfeiture
Definition
loss of money or anything of value due to failure to perform according to terms of contract
Term
fraud
Definition
intentional deception in which injured party has loss
Term
gross lease
Definition
(one big. owner receives rent and pays out expenses such as in apartment leasing. net lease ; owner receives rent and tenant also pays out expenses normally paid by owner such as taxes etc...
Term
injunction
Definition
an order of court to restrain one or more parties to a suit from doing an inequitable or unjust act in regard to the rights of some other party to the suit. ;stop doing something;
Term
instrument
Definition
a formal written document
Term
lease
Definition
contract between lessor [landlord] and lessee [tenant] for exclusive possession of realty for specified period under specific terms after which property reverts to lessor
Term
leaseback
Definition
the purchase of improved property and the leasing it back to seller; creates capital and favored tax treatment for seller
Term
leasehold
Definition
the interest which a lessee has in realty
Term
meeting of minds
Definition
an offer and acceptance; an agreement in contract
Term
net income
Definition
also known as the net operating income [n.o.i]; effective gross income minus operating expenses and property taxes
Term
normal consideration
Definition
something of value bearing no relation to real value $1
Term
novation
Definition
substitution of old obligation for a new one
Term
offer
Definition
statement of intent by offerer; ACCEPTANCE: statement of intent to accept offer by offeree
Term
option
Definition
a contract between owner and potential buyer ot lessee to buy or lease in future at specified terms; optionee gives consideration (no obligation]
Term
parol
Definition
oral; as distinguished from written
Term
percentage lease
Definition
a lease contract in which rental is based on a percentage of gross sales; usually with a fixed income
Term
power of attorney
Definition
written instrument authorizing another to act in his\her place; person given power is attorney-in-fact
Term
prima facie
Definition
on first view; on face of it; an odvious fact
Term
realty of consent
Definition
agreement to a contract must be free from fraud, duress, undue influence, and misrepresentation
Term
rescission of contract
Definition
annulling or abrogation of contract by mutual consent. (agree both parties to cancel contract]
Term
revocation
Definition
a recall or cancellation
Term
security deposit
Definition
money of tenand deposited with landlord to offset damages beyond reasonable wear and tear done by tenant
Term
sinking fund
Definition
money set aside from property income which, with accrued interest, will eventually pay for replacement of improvements
Term
specific performance
Definition
court decision ordering one party to comply with terms of contract
Term
surety
Definition
one who guarantees performance of another
Term
quiet enjoyment
Definition
right of owner or tenant to possession without interference
Term
tenancy at sufferance
Definition
a tenancy arising when tenant remains in possession after lease expires and without owner's permission
Term
tenancy at will
Definition
a tenancy which is subject to termination at will of either landlord or tenant
Term
time is of essence
Definition
exact and punctual performance of contract
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