Dearborn Modern Real Estate

Front 1

Truth in Lending Act

Back 1

Consumer protection act intended to force lenders to be truthful in their advertising; implemented by Regulation Z

Front 2

Physical Characteristics of real estate

Back 2

Immobility, Indestructibility, Uniqueness (non homogeneity)

Front 3

Negligent Representation

Back 3

Misrepresentation occurring when the broker should have known that the statement about a material fact was false.

Front 4

Bundle of Legal Rights

Back 4

Ownership of legal rights: control, possession, use, disposition, enjoyment

Front 5

Replacement Cost

Back 5

Current cost to reconstruct a building to serve the same function but not an exact duplicate of the original.

Front 6

Real Property

Back 6

Interests, benefits, and rights inherent in real estate ownership.

Hint 6

Land plus property plus bundle of rights

Front 7

Condominiums

Back 7

Ownership of the airspace of a unit, plus undivided interest in common elements.

Front 8

Cooperatives

Back 8

Multi-tenant building owned by trust or corporation; tenants own share of stock and proprietary lease.

Front 9

Economic Characteristics of Real Estate

Back 9

Scarcity, Improvements, Permanence of Investment, Area Preference (location)

Front 10

Planned Unit Development (PUD)

Back 10

Planned combination of diverse uses, such as housing, recreation, and shopping in one planned subdivision or development.

Front 11

Annexation

Back 11

Change personal property to real property, such as mixing sand, stone, and cement to make a sidewalk.

Hint 11

Not like the Mashantuckets

Front 12

Price Fixing

Back 12

Brokers conspiring to set fixed compensation rates

Front 13

Indemnification

Back 13

In a listing, a clause that states that the seller and broker will not sue each other for any incorrect information supplied by one to the other

Front 14

Market

Back 14

Place where goods are bought and sold, price is established

Front 15

Capital Gain

Back 15

Profit earned from the sale of an asset

Front 16

Improvement

Back 16

Man-made attachment to the land, such as building, streets, utilities

Front 17

Brokerage

Back 17

Bringing together parties interested in a real estate transaction

Front 18

Lien

Back 18

Right given by law to certain creditors to have their debts paid out of the property of a defaulting debtor, usually by court sale

Front 19

Affidavit of Title

Back 19

Written statement made under oath, that grantor identifies himself and marital status, certifies that there are no new defects on title

Front 20

Fraud

Back 20

Intentional misrepresentation of a material fact in order to harm or take advantage of another person

Front 21

Multiple Listing Service (MLS)

Back 21

Marketing organization in which brokers share information and commission with other brokers; Sellers gain because of greater exposure to larger market

Front 22

Rules and Regulations

Back 22

Licensing authority to provide for administering the law and set operating guidelines for licensees. Have the same force and effect as any law.

Front 23

Marketable Title

Back 23

Good or clear title, reasonably free from risk of litigation over possible defects

Front 24

Good Faith Estimate (GFE)

Back 24

Settlement costs that borrower is likely to incur; must be given within three business days after loan application; should be pretty accurate.

Front 25

Principal

Back 25

One who hires; broker (principal) hires salespeople, seller (principal) hires the broker/agent, or buyer (principal) hires broker/agent

Front 26

Usury

Back 26

Charging interest in excess of the maximum rate; often residential first mortgage loans are exempt from such laws

Front 27

Acknowledgment

Back 27

Formal declaration (by someone like a notary public) that a signature is both voluntary (no force) and genuine (no forgery)

Front 28

Adverse Possession

Back 28

Possession of another's land, as if the owner, for a statutory period which may lead to acquiring title

Front 29

Bilateral vs Unilateral Contract

Back 29

Bilateral: both parties are legally bound to act as promised (lease, purchase agreement)

Unilateral: only one party is bound to act (option, promissory note)

Front 30

Assignment

Back 30

Transfer in writing of interest in a bond, mortgage, or lease

Front 31

Ginnie Mae

Back 31

HUD division, corporation without stock; administers special assistance programs and works in tandem with Fannie Mae by guaranteeing payments

Front 32

Discount Point

Back 32

Unit of measurement used for various loan charges; one point equals one percent of the loan amount

Front 33

Standard Homeowner's Insurance

Back 33

Insurance package that covers residential property owner against financial loss from fire, theft, public liability, etc

Front 34

Property Management

Back 34

Management of another's property for compensation

Front 35

National Flood Insurance Act

Back 35

Requires flood insurance when financing with federally related loans on properties located in flood-prone areas

Front 36

Severance

Back 36

Changing of real to personal property, such as cutting down a tree or removing a stained glass window

Front 37

Intestate

Back 37

Person dies without a valid will; his or her property will pass to heirs as provided in the state law of descent

Front 38

Subdivision

Back 38

Splitting a single property into smaller parcels

Front 39

Abstract of Title

Back 39

Certification by abstractor that condensed history of title to a particular parcel of real estate, including conveyances and encumbrances, is correct

Front 40

Adjustable Rate Mortgage (ARM)

Back 40

Loan that has a fluctuating interest rate, usually one tied to a cost of funds index; the cost of doing business is the margin that stays fixed and is added to the base rate

Front 41

Acceleration Clause

Back 41

Clause in mortgage or deed of trust that can be enforced to make the entire debt immediately if borrower defaults

Front 42

Statute of Frauds

Back 42

State law requires certain instruments, such as deeds, real estate contracts, and certain leases to be in writing to be legally enforceable

Front 43

Quiet Enjoyment Covenant

Back 43

Clause in deed guaranteeing that the grantee's title will be good against third parties who might bring court action.