2016 kaplan inc may be reproduced for educational

©2016 Kaplan, Inc.
May be reproduced for educational uses only.

Texas Promulgated Forms, Second Edition Update
66. b. The answer is interest rate. 3A is down payment, 3B is sum of financing, and 3C is
sales price. Learning Objective 3.1.
67. a. The answer is Seller Financing Addendum and Loan Assumption Addendum. Both the
Seller Financing Addendum and Loan Assumption Addendum give the seller the option
to terminate the contract under a couple of circumstances related to approval of the
buyer’s credit. Failure to timely terminate may subject the seller to accepting the buyer’s
creditworthiness. Learning Objective 3.4.
68. d. The answer is if the buyer fails to provide credit documentation within the negotiated
time period. The only time the seller may receive the earnest money under the Seller
Financing Addendum is if the buyer fails to timely provide credit documentation within
the negotiated time period. While the seller may terminate based on the buyer’s credit,
the earnest money is refunded to the buyer. The buyer may not terminate if the seller fails
to timely provide notice of approval or non approval of the buyer’s credit. If seller fails to
timely provide notice, the buyer’s creditworthiness is deemed to be approved by the
seller. Learning Objective 3.4.
69. d. The answer is the legal description of the property. The marital status of the parties is
addressed in paragraph 1; the name of the parties is addressed in paragraph 1. The
property price is addressed in paragraph 3. Learning Objective 3.1.
70. d. The answer is paragraph 6. Paragraph 6 addresses the title policy, survey, and HOA
information, among other things. Paragraph 5 addresses earnest money, paragraph 7
addresses the property condition, and paragraph 4 addresses a licensee disclosure.
Learning Objective 3.1.
71. b. The answer is the contract terminates if the buyer timely notifies the seller that the
buyer was unable to get buyer approval. Under this provision, the contract terminates and
the buyer receives the earnest money. If the buyer fails to timely notify the seller, the
contract is still binding but no longer subject to a buyer approval contingency. Learning
Objective 3.4.
72. a. The answer is buyer required repairs. Repairs are addressed in paragraph 7. Paragraph
23 is the paragraph that addresses information related to the termination option. Learning
Objective 3.1.
73. b. The answer is TREC approved and promulgated the form. Learning Objective 3.2.
74. d. The answer is Third Party Financing Addendum. The Third Party Financing Addendum
details the requirements for a USDA guaranteed loan. There is no such form as the USDA
Financing Addendum. Learning Objective 3.4.
75. a. The answer is because Texas is a community property state. Although Texas is a
community property state, a married person can buy or sell separate property in Texas.