FINC 3250 Exam 2 Questions and Answers 2024 Solutions

FINC 3250 Exam 2 Questions and Answers 2024 

1. accept partial performance: the wronged party does not believe it would be waccept partial performance the wronged party does not believe it would be worth the hassle of pursuing the matter any further, so he/she accepts what has been done so far on the contract and moves on

2. What are the five things to know about property taxes? *(short definition)*:   -

1. Market Value (probable selling price that a property should bring in a competitive and open market)

2. Assessment Ratio (used to determine one's property tax liability)

3. Assessed Value (value assigned for property tax purposes)

4. Exemptions (churches)

5. Millage Rate (the amount per $1,000 used to calculate taxes on property)

3. Forfeiture: title may change due to one party's failure to uphold a restriction in a qualified fee.

4. Title Insurance: insurance that protects the holder from financial loss sustained from defects in a title to a property.

5. Marketable Title: title that is free from all reasonable doubt as to who the true owner is.

6. Quiet Title Suit: a lawsuit aimed at cutting off all claims of ownership except that of the rightful owner.

7. Chain of Title: a listing of the owners of a property from the time it was originally obtained from the government.

8. What is the difference btwn express contracts and implied contracts?: ex- press: when the parties to the contract either write or say their

intentions

implied: when the actions of the parties serve to form the contract.

9. Alienation: this is a catch-all term that simply refers to any transfer of title. The old owner is said to have alienated their ownership.

10. What are the three kinds of notices?: 1. Constructive

2. Inquiry

3. Actual

11. What are the three types of Public Records Organization: 1. Tract Index

2. Grantor/Grantee Index

3. Torrens System

12. What is a Deed?: a legal, written document (usually) used to transfer ownership from one party to another

13. What are the four things that determine the validity of a contract?: 1. Valid

2. Voidable

3. a Void

4. Unenforceble

14. Valid: a contract that meets all requirements of law. It is binding on both parties and enforceable in court

15. 6 Essentials of Valid Contracts: 1. Mutual Agreement (Both parties agree to the terms of the contract.)

2. Competent Parties (over 18, not drunk, etc.)

3. No diress (ex: gun to head)

4. Lawful Objective

5. Consideration

6. Must be in writing

16. What are the two types of consideration? What are their definitions?: 1. Valuable (money, anything worth money)

2. Good Consideration (a gift based on love and affection felt for another)

17. what are the 6 ways to have a Discharge of Contracts?: 1. full performance

2. Assignment (one party can assign his/her rights or obligations under the contract to another party)

3. Novation (substitution of a new contract between the existing or new parties or the substitution of a new party into an existing contract.)

4. Mutual Rescission (if both parties agree to cancel the contract before it is over)

5. Unlawful Objective (if the purpose of the contract becomes illegal)

6. Death (if the deceased party was the only one that could fulfill the contract obligations.)

18. what are the 6 Remedies for Breach of Contract: 1. Accept Partial Perfor- mance

2. Unilateral Rescission

3. Mutual Rescission

4. Lawsuit for Money

5. Lawsuit for Specific Performance

6. Liquidated Damages

19. Real Estate Sales Contracts Purpose: to bind each party to the sale while the buyer makes sure the seller is actually the owner and arranges financing.

20. Binder: some states use a binder to hold the deal together until the parties can meet with an attorney to draw up an official purchase contract.

21. Letter of Intent: two or more parties express an intent to pursue a particular real estate project, including an outline of the proposed project and a statement that the parties will move toward its completion. *This is not a legally binding contract.*

22. Naked Title: when either a real estate sales contract or an installment contract (as they exist today) is signed, the seller still technically retains title, but they are obligated to sell to the buyer. The title that the seller has is referred to as "naked" title, because they *no longer have all of their property rights but hold the title*

23. What are the three Options and their definitions?: 1. Option Contracts-An option to buy gives the owner of the option the right, but not the obligation, to buy the property.

2. Lease with Option to Buy-A lease is signed on a property that also includes a completed purchase contract.

3. Right of First Refusal-Often included in rental agreements, this gives the lessee the right to match any valid

offer to purchase received by the owner.

24. What are the seven elements of a deed? (exam question): 1. In writing

2. Name the grantor (seller) and grantee (buyer) 3. State the consideration

4. Granting clause

5. Property description

6. Signature of grantor (and,in some states, also the grantee)

7. Delivery and acceptance

25. What is the point of an exchange?: It is a way to defer capital gains taxes

26. Title Closing: Final step in real estate transaction, money changes hands

27. What are the two Typical Buyer Responsibilities before Closing: 1. EXERE- CISE DUE DILIGENCE

2. Obtain property insurance