A person acquires an option to purchase a parcel of another person's land. Which of the following statements is correct?
Answer(s): B
Comprehensive and Detailed Explanation (150250 words):An option contract is a unilateral contract in which the seller (optionor) grants the buyer (optionee) the exclusive right to purchase property at a specified price within a set time. For the option to be valid, the terms and conditions of the future sale must be clearly stated (price, property description, and time period). Consideration (option money) must also be given.A: Incorrect because only the optionor (seller) is obligated; the optionee (buyer) is not required to purchase.C: Option consideration is not automatically applied unless the contract specifically states it.D: Reverses the roles; the seller is the optionor, the buyer is the optionee.Thus, the correct answer is B.
Massachusetts Real Estate Salesperson Candidate Handbook Contracts; Options in Real Estate.
A rectangular lot contains 16,500 square feet. It has a depth of 150 feet. Each of two adjacent rectangular lots contains 4,950 square feet with a depth of 150 feet. What is the total street frontage of the three lots in linear feet?
Answer(s): C
But notice the answer choices do not include 176 except as D. This matches our calculation.Therefore, the correct frontage is 176 feet (D).(Note: The original problem text contained a typo listing 15 ft depth for the smaller lots, which is mathematically inconsistent. With the corrected 150 ft depth, the frontage answer is 176.)
Massachusetts Real Estate Salesperson Candidate Handbook Math (Area, Frontage, Lot Dimensions).
A building was purchased for $350,000 with a 20% down payment. If the lender charged the buyer three discount points, how much will the buyer need to close?
A buyer and a seller have a purchase agreement that contains a home inspection contingency. The buyer has applied for a VA mortgage. After the home inspection is completed, the buyer writes an addendum requesting that the seller pay to repair several items found by the home inspector. The seller counters the addendum by requiring that the buyer agree that the repairs will be made, but that no further expenses will be incurred by the seller. The VA appraisal inspection has not been conducted. Under these circumstances, which of the following is correct?
Comprehensive and Detailed Explanation (150250 words):In this scenario, the parties have entered into a binding purchase agreement with a home inspection contingency. The buyer submitted an addendum requesting seller repairs, but the seller countered. Since the buyer has not yet accepted, the counter is not binding -- therefore, the original contract remains in effect until both parties agree to a modification.Additionally, because the financing is a VA loan, the VA still requires a VA appraisal (separate from the buyer's home inspection) to determine value and minimum property requirements. The VA inspection cannot be waived by substituting the home inspector's report.Thus, the correct answer is B: the original contract is still in effect.
Massachusetts Real Estate Salesperson Candidate Handbook Contracts; VA Loan Program Guidelines.
In a jurisdiction where the common law of agency applies, a broker has listed a home and then presented to the seller an offer from another client of the broker. The offer has been accepted. The broker has what type of agency relationship with the parties?
Answer(s): D
Comprehensive and Detailed Explanation (150250 words):Under the common law of agency, an agent owes fiduciary duties to the party they represent. If a broker represents a seller under a listing agreement but also brings a buyer who is their client, the broker now represents both parties in the same transaction. This creates a dual agency relationship.Dual agency is lawful in Massachusetts only if there is full disclosure and written informed consent from both parties. Without disclosure, it would be an undisclosed dual agency, which is illegal.A: Incorrect -- the broker does represent the buyer.B: Facilitation is a non-agency relationship, but that's not the case here.C: Buyer is not a sub-agent of the seller; they are a client.Correct answer: D: dual agency.
Massachusetts Real Estate Salesperson Candidate Handbook Agency Law; 254 CMR 3.00.
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