After the contract is executed, the buyer discovers that the seller misrepresented the property's square footage—the actual size is 200 square feet less than stated. The buyer wants to renegotiate the price. The buyer's agent should:
Correct Answer
B) Propose a TREC Amendment reducing the purchase price and cite the square footage discrepancy
The buyer's agent should propose a TREC Amendment to reduce the purchase price based on the square footage discrepancy. This is a negotiation between the parties, and the amendment documents the agreed-upon change.
Why This Is the Correct Answer
Why the Other Options Are Wrong
Deep Analysis of This Promulgated Contract Forms Question
Background Knowledge for Promulgated Contract Forms
Real World Application in Promulgated Contract Forms
Common Mistakes to Avoid on Promulgated Contract Forms Questions
Related Topics & Key Terms
Key Terms:
Related Concepts
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
More Promulgated Contract Forms Questions
In Texas, title insurance rates are:
A Texas license holder is asked to prepare a lease-purchase agreement for a residential property. TREC has a promulgated Residential Lease form and a promulgated One to Four Family Residential Contract, but no promulgated lease-purchase form. What should the license holder do?
A relocation company purchases homes from transferred employees and then resells them. The company's attorney has drafted a standard purchase contract for all such transactions. A Texas license holder listing one of these properties receives an offer using the company's attorney-drafted contract. Should the license holder accept this contract?
Under the TREC contract, a TREC Amendment is effective when:
Sales agent Torres uses the current version of the TREC One to Four Family Residential Contract but does not realize that TREC recently updated the form. The transaction closes using the outdated version. What is the potential consequence?
- → License holder Kim is helping a buyer purchase a residential property that is currently a foreclosure being sold by a bank (REO property). The bank provides its own lengthy purchase agreement drafted by its corporate attorneys. Kim should:
- → A Texas license holder prepares a TREC promulgated contract for a residential sale. Before the buyer signs, the license holder strikes through the paragraph regarding the survey requirement and writes 'N/A - Survey Waived' in the margin. What is the potential consequence for this license holder?
- → TREC categorizes its forms into different classifications. Which of the following is NOT a category of TREC forms?
- → A Texas license holder may properly insert language into the Special Provisions paragraph (Paragraph 11) of the TREC promulgated contract in all of the following situations EXCEPT:
- → Under TREC rules, a Texas license holder is permitted to use a non-promulgated contract form in all of the following situations EXCEPT:
- → A government entity is selling surplus property (a single-family home) at a public auction. A Texas license holder representing a buyer at the auction is asked to sign the government's standard contract form. The form was not drafted by an attorney but is the government's standard form used for all surplus property sales. What should the license holder do?
- → Which of the following transactions does NOT require the use of a TREC promulgated contract form by a Texas license holder?
- → A license holder in Texas assists a client with a for-sale-by-owner (FSBO) transaction where the license holder is only providing limited services (filling out paperwork). The client wants to use a contract downloaded from the internet. The license holder should:
- → All of the following are valid exceptions to the mandatory use of TREC promulgated contract forms EXCEPT:
- → A Texas license holder receives a purchase offer from a buyer's agent. The offer uses the correct TREC promulgated form, but the buyer's agent has typed additional paragraphs on a separate page labeled 'Additional Contract Terms' and attached it to the form. These terms were not drafted by an attorney. What should the listing agent advise?