What is the purpose of a state's statute of frauds?

• A. regulates appraisal practice
• B. defines property boundaries
• C. requires certain documents to be in writing
• D. sets appraisal fees

Answer: (C)

The main idea being tested is why certain agreements must be in writing to be enforceable. The statute of frauds exists to prevent fraud and misunderstandings in important transactions by requiring a written document that records the essential terms of the agreement and is signed. This is especially important in property matters, where a deed, mortgage, or long-term contract provides a concrete, verifiable record of what was agreed, who is obligated, and the price or terms.

The purpose is not to regulate appraisal practice, define property boundaries, or set appraisal fees. Those functions involve different areas of law and practice, whereas the statute of frauds focuses on ensuring there is a written contract for certain significant transactions.