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Real Estate Law Test 2
12-Installment Contracts for the Sale of Real Estate 13-Fraud and Misrepresentation in Real Estate Transactions
18
Real Estate & Planning
Undergraduate 4
10/10/2009

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Cards

Term
Installment Contract, Contact for Deed, Land Contract
Definition
down payment with balance paid over time
Term
subpurchase
Definition
signing an installment contract to sell his or her interest
Term
Why would prepayment not be allowed on an installment sale?
Definition
The seller wants to avoid income tax
Term
agreed remedy
Definition
if buyer fails to make its payments, this clause gives the seller the right to terminate the contract and to retain the payments the buyer has been made
Term
recission
Definition
the seller may terminate the contract if the buyer fails to make its payments, but should restore the status quo
Term
If the buyer finds a defect in the property after closing, what are the options?
Definition

  • File suit in law court for money damages
  • File in chancery, or equity court which would seek rescission 

Term

In chancery court for the deal to be rescission, there must have been a deliberate lie.

T/F

Definition
False
Term
Who has the equitable title?
Definition
Buyer during the gap
Term
Who has the legal title?
Definition
Seller during the gap
Term
In a land contact the buyer should seek...
Definition

  1. Title Search
  2. Record K
  3. Signed deed in escrow
  4. Right to assign
  5. No property penalty
  6. Provision for seller to sign deed

Term
In a land contract the Seller should seek......
Definition

  1. Downpayment(substantial but not excessive)
  2. Credit Check
  3. Shift taxes, repairs, insurance etc to buyer
  4. Cant waste the property
  5. Acceleration

Term

Neither the seller nor the buyer can sell or mortgage their interest.

T/F

Definition
False...unless it is prohibited
Term

If the buyer fails to make its payments, the seller has the right to terminate the contract and to retain the payments the buyer has made.

T/F

Definition
True-Forfeiture clause
Term
In a land contact...the seller forecloses on the buyer..and a bidder can pay off the seller. What happens to the titles?
Definition
Winning bidder gets the legal title and the equitable is extinguished
Term
What are the advantages of the land contract?
Definition

Buyers: low downpayments

Sellers: marketing and possible tax advantages

Term
Sceinter
Definition
intention
Term
Fraud
Definition
False statement of a material fact
Term
Misrepresentation
Definition
no scienter 
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