• Shuffle
    Toggle On
    Toggle Off
  • Alphabetize
    Toggle On
    Toggle Off
  • Front First
    Toggle On
    Toggle Off
  • Both Sides
    Toggle On
    Toggle Off
  • Read
    Toggle On
    Toggle Off
Reading...
Front

Card Range To Study

through

image

Play button

image

Play button

image

Progress

1/100

Click to flip

Use LEFT and RIGHT arrow keys to navigate between flashcards;

Use UP and DOWN arrow keys to flip the card;

H to show hint;

A reads text to speech;

100 Cards in this Set

  • Front
  • Back
The earth's surface extending downward to the center of the earth and upward into space, including all things permanently attached, is known as:
A) Real property
B) Real estate
C) Land
D) A bundle of legal rights
The correct answer is "B - Real estate " The correct answer to this is real estate, but the terms real property and land are often confused with the term "real estate." However, "land" is a more specific definition, since it includes the earth's surface and all things attached by nature; while "real property" actually is the "bundle of legal rights of ownership" (or option D of the preceding answers).
Movable objects, which are not considered real estate, are known as:
A) Real property
B) Personal property
C) Fixtures
D) Emblements
The correct answer is "B - Personal property " Personal property is something that belongs to a PERSON, and that a PERSON could take with him when moving. Don't confuse this with real property, which is permanently affixed (and could be considered the opposite of personal property). Remember that a fixture is an article of personal property that has become permanently attached to land or a building, and then becomes a part of the real estate. While emblements are generally considered personal property, this term refers specifically to annual crops on a property.
The permanent right to use another's land for the benefit of a neighboring parcel is known as:
A) An easement in gross
B) An appurtenant easement
C) An easement by necessity
D) A license
The correct answer is "B - An appurtenant easement " Appurtenant easements are those for adjacent properties or neighbors, which run with the land. (Think of the A's -- Appurtenant = Adjacent (property) of Another.) An easement in gross is the opposite of an appurtenant easement. A license isn't an easement at all, and an easement by necessity is, as the name states, NECESSARY (for another person to enter his own land by going through another's property).
The ownership of property by one person only is known as:
A) severalty
B) joint tenancy
C) tenancy in common
D) tenancy by entirety
The correct answer is "A - severalty " Severalty is the correct answer -- think of its root word, "sever." Ownership is severed or separated from any form of co-ownership, while tenancy in common, joint tenancy and tenancy by the entirety are ALL forms of co-ownership.
A condensed history of a title to a particular piece of real estate, including a summary of the original grant, and all subsequent conveyances and encumbrances affecting the property, is known as the:
A) abstract of title
B) evidence of title
C) certificate of title
D) chain of title
The correct answer is "A - abstract of title " Again, you can remember this by remembering ANOTHER three As - An Abstract of title is a history of All recorded instruments Affecting the title to a piece of land. This can be sometimes confused with the chain of title, which only shows a record of ownership of the property. Evidence of title is the documentary proof of a good title to the property, while the certificate of title does not involve an abstract at all.
The illegal practice of inducing homeowners to sell their properties by making representations about the prospective entry of persons of a certain race/national origin into the neighborhood is also called:
A) redlining
B) blockbusting
C) commingling
D) steering
The correct answer is "B - blockbusting " It is easy to get the three Fair Housing violations of redlining, steering, and blockbusting confused, but think of "blockbusting" as "busting up a block" by trying in induce or force people to move out of their neighborhood (or block). (Commingling isn't a Fair Housing violation at all, but a violation involving finances.)
The term for something that grants the right to use another's land for a specific purpose, and is considered an incorporeal interest in land is:
A) an encumbrance
B) an easement
C) an encroachment
D) an equitable lien
The correct answer is "B - an easement " An easement grants the right to use another's land for a specific purpose. Remember that an EASEMENT is one type of encumbrance, and liens are another type of encumbrance. It is easy to confuse the three terms, but try to remember that EncUMbrance has the other two rights UNder it. Licenses are not classified within these categories because licenses are not permanent rights.
The clauses in a deed that limit the future uses of a property are known as:
A) acknowledgements
B) granting clauses
C) words of conveyance
D) deed restrictions
The correct answer is "D - deed restrictions " Deed restrictions can impose various limitations and conditions - in other words, they RESTRICT the types of structures that may be built on the property, or the uses for which a property can be utilized. On the other hand, an acknowledgement is proof of identification (for the grantor's signature). The granting clause and words of conveyance are the same thing - they grant the intention to transfer or convey the property's ownership.
The loss of value in any property, regardless of the specific cause, in an appraisal, is known as:
A) descent
B) functional obsolescence
C) physical deterioration
D) depreciation
The correct answer is "D - depreciation " Depreciation refers to a GENERAL loss in value, as opposed to "functional obsolescence" or "physical deterioration," which refer to specific types of depreciation, or losses in value. "Descent" is a term used in conjunction with inheritances, and is not related to the other terms at all.
A person who has complete control over a parcel of real estate is said to own a:
A) leasehold estate.
B) fee simple estate.
C) defeasible fee estate.
D) life estate.
The correct answer is "B - fee simple estate. " Fee Simple, also known as fee simple absolute is known as the highest degree of ownership. The other "estate" terms are all much more limited forms of ownership - a life estate expires over time, a leasehold estate has a definite term, and a defeasible estate is limited by a certain event happening.
The law that requires real estate contracts to be in writing to be enforceable is the
A) statute of frauds.
B) statute of limitations.
C) law of descent and distribution.
D) parole evidence rule.
The correct answer is "A - statute of frauds. " Under the Statute of Frauds, contracts for sale of real property must be in writing to be enforceable -- this is to prevent FRAUD from occurring. Don't confuse this with the statute of limitations, which sets limits on the time in which actions may be brought against a person; constitutional law, which is the law arising from the federal and state constitutions; or descent, a term used in conjunction with inheritances.
The effort that brings about the desired result in a real estate sale is known as:
A) procuring cause
B) principal
C) procuring broker
D) REALTOR
The correct answer is "A - procuring cause " Procuring cause of sale is the effort that brings about the desired result - in this instance, a ready, willing, and able buyer. The other terms refer to people - a principal is the person for whom the broker works, while a REALTOR is a member of the National Association of REALTORS. The term "procuring broker" isn't a term used in real estate at all.
A naturally occurring gas that is suspected of causing lung cancer is known as:
A) lead based paint
B) asbestos
C) radon
D) Polychlorinated biphenyls (PCBs)
The correct answer is "C - radon " While each of these items are environmental hazards, radon is the radioactive, odorless, tasteless gas produced by the natural decay of other radioactive substances. The rest of the items are not gas hazards, but solid ones - asbestos is a mineral, lead-based paint is paint (as the name states), and PCBs involve electrical equipment.
A claim or liability attached to a property is called:
A) a lien
B) an encumbrance
C) an easement
D) a buyer's claim
The correct answer is "B - an encumbrance " Remember that an encumbrance is any claim against a property. Restrictions, liens, and buyer's claims (also known as a vendee's lien) are all FORMS of encumbrances.
In an appurtenant easement, the party that benefits is known as the:
A) lessee
B) leaser
C) servient tenement
D) dominant tenement
The correct answer is "D - dominant tenement " The person whose land is benefited by the easement, and therefore is the DOMINATING PARTY, is considered the dominant tenement. The servient tenement is the opposite of this. Leaser and leasee involve lease agreements, and have nothing to do with easements.
An encumbrance that affects the title, usually related to money, is known as:
A) a lien
B) an easement in gross
C) an easement by necessity
D) an easement by prescription
The correct answer is "A - a lien " A lien is a charge against a property -- a financial encumbrance. The other easements listed here do not deal with finances, but are considered usage encumbrances and affect the way in which the land may be USED.
A recorded legal document that gives constructive notice that an action affecting a certain property has been filed in court is called:
A) habendum clause
B) general warranty deed
C) estoppel certificate
D) lis pendens
The correct answer is "D - lis pendens " Lis pendens is Latin for "litigation pending," which will help you to remember that while a lis pendens isn't a lien, it is notice that litigation (a possible lien) is pending. The other terms listed deal with deeds (habendum clause and general warranty deed), or mortgages (estoppel certificate).
This document that defines the relationship between the real estate firm and the seller is the:
A) listing agreement
B) exclusive agency contract
C) purchase contract
D) disclosure statement
The correct answer is "A - listing agreement " While disclosure statements, purchase contracts, and even exclusive agency contracts are also legal documents that the broker or salesperson enters into with the clients, but it is the listing agreement that clearly defines the relationships and agreements between the broker and principal.
The rights of a landowner to use waters of an adjacent stream or river are known as:
A) riparian rights
B) zoning rights
C) littoral rights
D) livery of seisin
The correct answer is "A - riparian rights " While both riparian and littoral rights have to do with water, remember that riparian rights have to do with FLOWING bodies of water, such as rivers. (You might keep in mind that River and Riparian both begin the same way.) Zoning and seisin both deal with land control.
The rights of a landowner to use waters of an adjacent lake or ocean are known as:
A) riparian rights
B) zoning rights
C) littoral rights
D) livery of seisin
The correct answer is "C - littoral rights " Again, while both riparian and littoral rights concern water, littoral rights specifically apply to nonmoving bodies of water, like lakes and oceans. Zoning and seisin both deal with land control.
A claim or interest revealed by a title search is called a:
A) cloud on title
B) lien
C) judgment
D) lis pendens
The correct answer is "A - cloud on title " It's easy to remember a cloud on a title as something marring the clear title, like a cloud in the sky marring an otherwise clear sky. These terms are all related, however, since lis pendens is the notification that a lien might be placed on a title, or, in other words, that there is a CLOUD on the title. (A judgment is another type of lien against a property, issued by a court.)
When the amortized payment of a mortgage remains constant over the period of the loan but leaves an outstanding balance to be paid at the end, this payment is called:
A) An alienation payment
B) An escalation payment
C) A balloon payment
D) An acceleration payment
The correct answer is "C - A balloon payment " In a balloon loan, the interest and principal are paid on an equal basis, until the final payment (the balloon). This differs from the other payments - an acceleration payment, which makes the whole debt due if the borrower defaults; a satisfaction, in which the debt is paid in full on a mortgage; or an alienation, which provides that the lender can make the debt due, or allow the buyer to assume the loan on the sale of a property.
The process in which boundaries are measured and land areas determined is called:
A) an appraisal
B) an assessment
C) a survey
D) an involuntary lien
The correct answer is "C - a survey " A survey is the process that measures boundaries and land areas. This is often confused with appraisal, which APPRAISES the value of something (often a property) or assessment, which imposes TAX on something. A lien is a financial encumbrance.
An estimate of the value of something, usually a property, is known as:
A) an appraisal
B) an assessment
C) a survey
D) a lien
The correct answer is "A - an appraisal " An appraisal is the process that APPRAISES the value of a property. Don't confuse this with a survey, which measures boundaries and land areas; or an assessment, which imposes TAX on something. A lien is a financial encumbrance.
A lien placed on the property without the consent of the owner is known as a(n):
A) involuntary lien
B) deed of trust lien
C) voluntary lien
D) mortgage lien
The correct answer is "A - involuntary lien " An involuntary lien is created by law without any action on the owner's part. A voluntary lien, just the opposite, is created by the owner -- this includes a mortgage lien or deed of trust lien.
This type of lien is created by law. It is known as:
A) a statutory lien
B) a voluntary lien
C) an equitable lien
D) a specific lien
The correct answer is "A - a statutory lien " A statutory lien is created by law - think "statutes" - as opposed to voluntary liens, created by choice, equitable liens, created by agreement, or specific liens, secured by specific property.
The type of lien that is secured by specific property and only affects that property is known as:
A) a statutory lien
B) a voluntary lien
C) an equitable lien
D) a specific lien
The correct answer is "D - a specific lien " A specific lien involves specific property- as opposed to voluntary liens, created by choice, equitable liens, created by agreement, or statutory liens, created by law.
The system established in 1785 by the U.S. government, which describes land with principal meridians and base lines, is called:
A) Point of Beginning
B) lot-and-block system
C) rectangular survey system
D) metes-and-bounds
The correct answer is "C - rectangular survey system " The rectangular survey system is the form of survey that uses principle meridians and base lines -- think of lines forming rectangles. Metes and bounds is another type of legal description, and a "point of beginning" is used within this type of description; the lot-and-block system refers to another description, and involved the lots and block numbers specified on a recorded subdivision plat.
A listing contract under which the broker's commission is contingent upon his producing a ready, willing, and able buyer before the property is sold by the seller or another broker is known as:
A) an exclusive listing
B) a net listing
C) an exclusive right-to-sell listing
D) an open listing
The correct answer is "D - an open listing " In an open listing, the broker only earns a commission if he provides a ready, willing, and able buyer before anyone else does. It allows the listing to be OPEN to many brokers, whereas with both exclusive listings and exclusive-agency listings, only one broker is involved. Net listings, which are illegal in many states, also involve only one broker.
A portion of a township under the rectangular survey system, which is a square with mile-long sides, is called a:
A) plat
B) blocks
C) section
D) township
The correct answer is "C - section " While both sections and townships are used in the rectangular survey system, a SECTION is the portion under the system that is a square with mile-long sides. A township is divided into 36 sections. Remember that the lot-and-block system refers to another description, and involves the lots and block numbers specified on a plat.
The type of easement that is necessary for another person to enter his own land by going through another's property is known as:
A) an easement in gross
B) an easement by necessity
C) a license
D) an appurtenant easement
The correct answer is "B - an easement by necessity " An easement by necessity is, as the name states, NECESSARY for another person to enter his own land by going through another's property. Appurtenant easements are those for adjacent properties or neighbors, which run with the land; an easement in gross is the opposite of an appurtenant easement; and a license isn't an easement at all.
A contract in which all the parties have fulfilled all their promises and performed the contract is known as:
A) an executory contract
B) an executed contract
C) an express contract
D) a unilateral contract
The correct answer is "B - an executed contract " If a contract is EXECUTED, that means all parties have done what they agreed to do. Don't confuse this with an executory contract, in which something remains to be done by one (or more) of the parties of the contract; or an express contract, in which the contract terms are VERBALLY expressed to one another. A unilateral contract is a one-sided contract.
An oral contract in which the parties state the contract's terms and express their intentions in words is known as:
A) an executory contract
B) an executed contract
C) an express contract
D) unilateral contract
The correct answer is "C - an express contract " Think of EXPRESSING yourself with an express contract, in which the contract terms are expressed to one another in words. This differs from an executed contract, in which the parties have done what they agreed to do; an executory contract, in which something remains to be done by one (or more) of the parties of the contract, or a unilateral contract, which is a one-sided contract.
The type of depreciation caused by outside factors, which are external to the property, is known as:
A) curable depreciation
B) external obsolescence
C) functional obsolescence
D) physical depreciation
The correct answer is "B - external obsolescence " External obsolescence is usually related to conditions outside of - or EXTERNAL TO - the property itself. Each of the other types of depreciation mentioned involve the property ITSELF.
The benefit, interest or value that induces a promise, and the glue that binds a contract, is known as:
A) an option
B) consideration
C) earnest money
D) novation
The correct answer is "B - consideration " Consideration is the thing of value which induces a party to enter a contract. Don't confuse this with earnest money, which can be considered consideration -- but isn't the ONLY kind of consideration. The other terms are novation, which is about substituting parties or duties in an obligation, and option, which is an agreement to keep an offer to sell open for a set period.
The illegal act of a real estate broker who places his client's or customer's funds with his own funds is known as:
A) panic selling
B) redlining
C) commingling
D) blockbusting
The correct answer is "C - commingling " Commingling, or mixing funds, is ILLEGAL and brokers who commingle funds can be prosecuted. Each of the other terms listed here fall under the realm of Fair Housing violations.
The failure to perform provisions of a contract without a legal excuse is known as a(n):
A) termination of contract
B) exclusions
C) option
D) breach of contract
The correct answer is "D - breach of contract " A violation of any terms of the contract without a legal excuse is a breach of contract - think of BREACHING as BREAKING the terms of the contract. Termination of contract is simply the ending of the contract (but not necessarily because of any wrongdoing); exclusions, which actually deal with insurance policies; or an option, which is an agreement to keep an offer to sell open for a set period.
A refusal to make reasonable accommodations in rules, policies, practices, or services when such accommodations may be necessary to afford such person equal opportunity to use and enjoy a dwelling is one definition of:
A) Fair Housing
B) redlining
C) blockbusting
D) discrimination
The correct answer is "D - discrimination " Discrimination is the correct term in this case, the broad term to describe all types of discriminatory acts. Remember that these people are usually protected under the Fair Housing laws. Keep in mind that both redlining and blockbusting are specific discriminatory acts.
The easement that is not created for the benefit of the land owned by the owner of the easement, but that attaches personally to the easement owner is known as an:
A) easement in gross
B) easement by condemnation
C) easement by necessity
D) easement by prescription
The correct answer is "A - easement in gross " An easement in gross is not created for the benefit of the land owned by the owner of the easement, but that attaches personally to the easement owner. Don't confuse this with the other types of easements - easement by condemnation, in which the property is acquired for PUBLIC purpose; an easement by prescription, which is acquired by continuous, open and hostile use of another's property over a period of years; or an easement by necessity, which is necessary for another to enter and exit his own property.
A lease that goes from month to month is known as:
A) a life estate
B) an estate at will
C) an estate from period to period
D) a fee simple estate
The correct answer is "C - an estate from period to period " An estate from period to period is an interest in a leased property that goes from period to period, be it week to week, month to month, or year to year. Don't confuse this with fee simple, which is the highest degree of ownership; a life estate, which expires over time; or an estate at will, which is indefinite in length.
A lease that goes from month to month is known as:
A) a life estate
B) an estate at will
C) an estate from period to period
D) a fee simple estate
The correct answer is "C - an estate from period to period " An estate from period to period is an interest in a leased property that goes from period to period, be it week to week, month to month, or year to year. Don't confuse this with fee simple, which is the highest degree of ownership; a life estate, which expires over time; or an estate at will, which is indefinite in length.
A situation in which the tenant's lease has expired and the tenant is no longer paying rent, but is living on the property is known as:
A) an estate for years
B) estate at will
C) estate from period to period
D) estate at sufferance
The correct answer is "D - estate at sufferance " In an estate at sufferance, the tenancy is by a lessee who lawfully occupies the landlord's property, but then continues to occupy the property improperly after his rights have expired. Think of it this way: the landlord and the estate are SUFFERING because rent is not being paid. The other types of estates mentioned here are actual lease agreements, but this is a situation of one party being unwilling to abide by the terms of any agreements previously reached.
A mortgage clause which states that, should the borrower sell the property, the entire balance of her mortgage would be due immediately, is known as:
A) the due-on-sale clause
B) the acceleration clause
C) the satisfaction clause
D) estoppel certificate
The correct answer is "A - the due-on-sale clause " The due-on-sale clause is also known as an alienation clause or resale clause, and says that the balance must be paid in full if the property is sold. Don't confuse this term with an acceleration clause, which makes the whole debt due if the borrower defaults; a satisfaction, in which the debt is paid in full on a mortgage, or an estoppel certificate, which is not a clause at all but a document in a mortgage.
The legal procedure in which property is pledged as security is sold to satisfy the debt is known as:
A) foreclosure
B) actual eviction
C) constructive eviction
D) deficiency judgment
The correct answer is "A - foreclosure " Foreclosure brings the rights of the parties and all junior lienholders to an end. Don't confuse this with the forms of evictions, which are in regard to leased properties, or deficiency judgment, which is a personal judgment levied against a borrower when a foreclosure sale doesn't bring enough money to satisfy a debt.
A mineral that was once used as insulation, and is now considered harmful if disturbed or exposed, is:
A) radon
B) asbestos
C) lead-based paint
D) PCBs
The correct answer is "B - asbestos " Asbestos insulation can create airborne contaminants that may result in respiratory diseases. Don't confuse this with other environmental hazards listed here -- radon, the radioactive, odorless, tasteless gas; PCBs, which involve electrical equipment, and lead-based paint, which, as the name states, is paint.
The sealing off of disintegrating asbestos is one method of asbestos control. This is known as:
A) irradiation
B) encapsulation
C) capping
D) removal of tanks
The correct answer is "B - encapsulation " Encapsulation is one method of asbestos control that is usually preferable to removal. Don't confuse this with the other means of controlling environmental hazards - removal of tanks, for USTs; capping, for landfills; and irradiation, for radon.
The environmental hazard found mostly in electrical equipment is known as:
A) radon
B) asbestos
C) lead-based paint
D) PCBs
The correct answer is "D - PCBs " PCBs, or polychlorinated biphenyls involve electrical equipment. Don't confuse this with other environmental hazards listed here -- radon, the radioactive, odorless, tasteless gas; lead-based paint, which, as the name states, is paint, or asbestos, which involves insulation and can cause respiratory diseases.
The clause in a mortgage that can be enforced to make the entire debt due immediately if the mortgagor defaults on the loan is the:
A) alienation clause
B) acceleration clause
C) due-on-sale clause
D) a satisfaction
The correct answer is "B - acceleration clause " The acceleration clause allows the lender to move up the date when the entire sum is due. Don't confuse this with the due-on-sale clause (which is the same as an alienation clause), which says that the balance must be paid in full if the property is sold; or a satisfaction, in which the debt is paid in full on a mortgage.
A person who is authorized to represent another is the:
A) agent
B) client
C) principal
D) customer
The correct answer is "A - agent " An agent is a person who represents another -- in most cases of real estate, the represented person is known as the client or principal. The customer is the third party with whom the broker and his principal interact, but who is NOT represented by the broker.
The remnant of an estate that has been conveyed to take effect and be enjoyed after the termination of a prior estate, as when an owner conveys a life estate to one party and the remainder to another, is called:
A) the right of survivorship
B) the remainder estate
C) the reversionary right
D) the reversionary interest
The correct answer is "B - the remainder estate " The remainder estate is that which is left from a life estate. Don't confuse this with reversionary interest, which is the future interest that reverts to a grantor or his heirs, or reversionary right, which is the return of the rights of possession of the property to the lessor at the end of a lease. Right of survivorship doesn't involve leases at all, but joint ownership.
A deed that contains no warranties, but in which the grantor does give up his own rights or claims, is known as:
A) a quitclaim deed
B) words of conveyance
C) a deed restriction
D) the granting clause
The correct answer is "A - a quitclaim deed " A quitclaim deed is one in which NO guarantees are offered about past claims to the property, with the exception of those held by the grantor. Deed restrictions can impose various limitations and conditions on the uses for which a property can be utilized; and the granting clause and words of conveyance are the same thing - this grants the intention to transfer or convey the property's ownership.
If one creditor is substituted for another, with the substituted person succeeding to the legal rights of the original creditor, this is known as:
A) a judgment
B) subordinate agreement
C) subrogation
D) the granting clause
The correct answer is "C - subrogation " Subrogation is often used by title insurers to acquire rights to sue from the injured party (to recover claims they've paid). Don't confuse this with a judgment, which is a court decree ordering money to be paid; a subordinate agreement, which changes the priority of the liens to be paid under certain conditions, and granting clauses, which have to do with transferring property ownership.
The joint ownership that is recognized in some states, of property acquired by husband and wife during marriage, is known as:
A) severalty
B) joint tenancy
C) tenancy by the entirety
D) tenancy in common
The correct answer is "C - tenancy by the entirety " With tenancy by the entirety, when one spouse dies, the surviving spouse then owns the property. Don't confuse this with tenancy in common, which means the person owns an undivided interest in the property; severalty, which is ownership by one person only, or joint tenancy, which is a more general term describing the ownership of property by two or more people.
A type of value estimate approach, in which value equals the estimated land value plus reproduction costs of any improvements, after the depreciation costs have been subtracted, is called the:
A) market approach
B) cost approach
C) substitution approach
D) income approach
The correct answer is "B - cost approach " The cost approach is what is described here - it estimates the amount needed to reproduce or replace the property. Don't confuse this with the income approach, used for investment properties, the comparative market analysis, which compares recently sold, similar homes, or substitution, which isn't an appraisal approach, but is an economic principle comparing two similar homes.
This appraisal approach estimates the value of the present worth of the future rights to the income the property generates by converting the net income of the property into a value. This is known as:
A) comparative market analysis
B) substitution
C) cost approach
D) income approach
The correct answer is "D - income approach " The income approach, also called capitalization, is used to appraise investment or income-producing properties. Don't confuse this with the cost approach, which estimates the amount needed to reproduce or replace the property; the comparative market analysis, which compares recently sold, similar homes; or substitution, which isn't an appraisal approach, but is an economic principle comparing two similar homes.
An estimate based on an analysis of comparable sales and other pertinent market data is known as:
A) income approach
B) market value
C) market price
D) cost approach
The correct answer is "B - market value " Market value is the estimate based on the analysis of comparable sales. Don't confuse this with market PRICE, which is the amount for which the property actually is sold for. Remember that cost approach is used to assess the reproduction price of a property, while the income approach is used to appraise income-producing properties.
If a landlord breaches a lease by allowing the property to fall into severe disrepair, which causes her tenant to leave the property because it is uninhabitable, this is known as:
A) actual eviction
B) breach of lease
C) termination of lease
D) constructive eviction
The correct answer is "D - constructive eviction " In a constructive eviction, it is the LANDLORD breaching the lease, rather than the tenant. In an actual eviction, it is the tenant breaking the lease. Neither termination of lease (which is simply the expiration of the lease), or breach of lease (the tenant's failure to follow any lease provision) is a form of eviction.
The type of lease that allows for the rent to be increased or decreased periodically based on changes in the government cost-of-living index is known as a:
A) percentage lease
B) graduated lease
C) index lease
D) assignment lease
The correct answer is "C - index lease " An index lease allows for increases OR decreases in the rent dependent on the cost-of-living index. Don't confuse this with a graduated lease, which only allows for INCREASES in rents; assignment leases, which is subleasing; or a percentage lease, which provides for a minimum fixed rental fee plus a percentage of the tenant's business income.
The type of lease that allows for the step-up of rent payments and is used to attract tenants to difficult-to-rent properties is called a:
A) percentage lease
B) graduated lease
C) index lease
D) assignment lease
The correct answer is "B - graduated lease " A graduated lease allows for a periodic increase in payments. Don't confuse this with an assignment lease, which is subleasing; a percentage lease, which provides for a minimum fixed rental fee plus a percentage of the tenant's business income; or an index lease, which allows for both increases AND decreases in rent based on the cost-of-living index.
In a lease, the lessor's interest is known as the:
A) leased fee interest
B) leasehold interest
C) subleasing
D) assignment
The correct answer is "A - leased fee interest " The leased fee interest is the lessor's interest, while the leasehold interest is the LESSEE'S interest. Remember that both subleasing and assignment are the same thing - simply the option to transfer all or a portion of a lease to another person.
A court order that authorizes and directs the proper officer of the court to sell the property of a defendant as required by the judgment or decree of the court is known as:
A) a writ of attachment
B) a writ of execution
C) constructive eviction
D) actual eviction
The correct answer is "B - a writ of execution " A writ of execution authorizes the sale of the property. Don't confuse this with writ of attachment, which is an action taken by a creditor in which the court simply retains custody of the property while a lawsuit is being decided. Remember that both constructive and actual evictions deal with LEASED, not owned properties.
An action taken by a creditor in which the court simply retains custody of the property while a lawsuit is being decided is known as:
A) a writ of attachment
B) a writ of execution
C) constructive eviction
D) actual eviction
The correct answer is "A - a writ of attachment " Remember, a writ of attachment is an action taken by a creditor in which the court simply retains custody of the property while a lawsuit is being decided. This is easily confused with a writ of execution, which authorizes the sale of the property. Remember that both constructive and actual evictions deal with LEASED, not owned properties
The buyer or purchaser under a land contract is also known as the:
A) vendee
B) vendor
C) leasee
D) leaser
The correct answer is "A - vendee " A vendee is a buyer in a land contract; the vendor is the seller. Neither a leaser nor a leasee has anything to do with land contracts.
A type of junior mortgage in which the existing mortgage amount, plus any additional purchase funds, is loaned to a buyer by the seller is known as:
A) a writ of attachment
B) a writ of execution
C) a voluntary lien
D) wraparound mortgage
The correct answer is "D - wraparound mortgage " Remember that a wraparound mortgage "wraps around" -- in other words, another lender, usually the seller, finances a borrower by lending an amount over and above the existing first mortgage amount without disturbing the first mortgage. Remember that a voluntary lien refers to ALL liens undertaken voluntarily by the owner (mortgages are only ONE type of such lien), while a writ of attachment and writ of execution are legal actions taken by the courts regarding a particular property.
The seller under a land contract is also known as:
A) the vendee
B) leasee
C) the vendor
D) leaser
The correct answer is "C - the vendor " A vendor is a seller under a land contract, while a vendee is a buyer. Neither a leaser nor a leasee has anything to do with land contracts.
A written document that provides for the transfer of title of property owned by the deceased is a(n):
A) testate
B) testator
C) intestate
D) will
The correct answer is "D - will " A will transfers the title to property owned by the testator, or the deceased. Remember that testate and intestate simply refer to the fact of whether a person died WITH a will (testate) or without one (intestate). A testator is the PERSON who makes the will.
An exercise of police power by a municipality to regulate and control the character and use of the property is called a(n):
A) zoning ordinance
B) littoral rights
C) riparian rights
D) subrogation
The correct answer is "A - zoning ordinance " A zoning ordinance is an exercise of police power. Remember that both littoral and riparian rights concern water; while surrender is the cancellation of a lease.
A one-sided contract is known as a:
A) unilateral contract
B) bilateral contract
C) involuntary lien
D) voluntary lien
The correct answer is "A - unilateral contract " Remember that a unilateral contract is ONE-sided (think uni- as the prefix meaning "one"), while a bilateral contract involves TWO (or more) persons. Liens are not contracts, so neither voluntary nor involuntary liens apply in this case.
The absolute ownership of a unit in a multi-unit building, based on a legal description of the airspace the unit actually occupies, is a:
A) condominium
B) cooperative
C) time sharing
D) community property
The correct answer is "A - condominium " A condominium means the person actually OWNS the unit. This is not to be confused with a cooperative, or co-op, in which the person is actually a tenant with stock in the company. Community property is a system of property ownership only valid in certain states, while time sharing is the undivided ownership of real estate for only a portion of a year.
If a person lives in an apartment, and owns stock in the corporation possessing the proprietary lease, this is known as a:
A) condominium
B) cooperative
C) time sharing
D) community property
The correct answer is "B - cooperative " Remember that with a cooperative, or co-op, the person is actually a tenant with stock in the company - not to be confused with a condominium, in which the person actually OWNS the unit. Community property is a system of property ownership only valid in certain states, while time sharing is the undivided ownership of real estate for only a portion of a year
With this type of contract, two or more parties are bound to act as described in the contract.This is called a:
A) unilateral contract
B) bilateral contract
C) voluntary lien
D) involuntary lien
The correct answer is "B - bilateral contract " A bilateral contract is TWO- (or more) sided, as the prefix indicates. Remember that a unilateral contract is ONE-sided (think uni- as the prefix meaning "one"). Liens are not contracts, so neither voluntary nor involuntary liens apply in this case.
A term used to refer to any document that transfers title to real property is known as:
A) conveyance
B) conversion
C) consideration
D) counteroffer
The correct answer is "A - conveyance " Conveyance describes any act of transferring. Don't confuse this with conversion, which is simply changing the status of a property; consideration, which is something of value given to induce a party into a contract; or counteroffer, which happens BEFORE the purchase agreement is completed.
A new offer made in response to an offer received is a(n):
A) conveyance
B) consideration
C) contingency
D) counteroffer
The correct answer is "D - counteroffer " A counteroffer actually rejects the original offer, and takes its place. Don't confuse this with conversion, which is simply changing the status of a property; consideration, which is something of value given to induce a party into a contract, or conveyance, which is the act of transferring property.
The parts of the property that are necessary or convenient to the existence, maintenance and safety of a condominium and are normally in common use by all of the condo residents are known as:
A) community property
B) common elements
C) conveyance
D) covenant
The correct answer is "B - common elements " Each condo owner has an undivided ownership interest in the common elements. Examples are: the pools, tennis courts, game rooms, parking areas and exterior of the building.
The appraisal principle that states that the value of any component of a property is what it gives to the value of the whole or what its absence detracts from the whole is called:
A) conformity
B) anticipation
C) competition
D) contribution
The correct answer is "D - contribution " Contribution says that the value of any component of a property is what its addition contributes to the value of the whole. Don't confuse this with the other principles of value - conformity, which says that the maximum value is realized if the use of the land conforms to existing neighborhood standards; anticipation, which says that the value can increase or decrease in anticipation of some future benefit/problem affecting the property; or competition, which says that excess profits will attract competition.
The process of changing a property's status from rental to condominium is known as:
A) conversion
B) anticipation
C) competition
D) contribution
The correct answer is "A - conversion " Remember, conversion is "CONVERTING" a property's status from rental to condominium. Contribution, anticipation, and competition are all principles of value, and not related to conversion.
A person who has made and left a valid will is known as being:
A) testate
B) intestate
C) reversionary right
D) reversionary interest
The correct answer is "A - testate " Testate is WITH a will; intestate is without a will. Don't confuse this with reversionary interest, which is the future interest that reverts to a grantor or his heirs, or reversionary right is the return of the rights of possession of the property to the lessor at the end of a lease.
A person who dies without leaving a will is known as having died:
A) testate
B) intestate
C) reversionary right
D) reversionary interest
The correct answer is "B - intestate " Remember that INTESTATE is WITHOUT a will, while testate is with a will. Don't confuse these terms with reversionary interest, which is the future interest that reverts to a grantor or his heirs, or reversionary right is the return of the rights of possession of the property to the lessor at the end of a lease.
The appraisal principle that follows the interrelationship of the supply of and demand for real estate is called:
A) conformity
B) anticipation
C) competition
D) supply and demand
The correct answer is "D - supply and demand " The principle of supply and demand is based on economic concepts, and says that real property is subject to the influences of the marketplace. Don't confuse this with the other principles of value - conformity, which says that the maximum value is realized if the use of the land conforms to existing neighborhood standards; anticipation, which says that the value can increase or decrease in anticipation of some future benefit/problem affecting the property; or competition, which says that excess profits will attract competition.
The return of the rights of the possession and quiet enjoyment to the lessor at the expiration of a lease is known as:
A) reversionary interest
B) reversionary right
C) reversion
D) remainder estate
The correct answer is "B - reversionary right " Reversionary rights REVERT back to the lessor at the end of the lease. Don't confuse this with reversion, which is the PROCESS by which the remnant reverts to the grantor; reversionary interest, which is the future interest that reverts to a grantor or his heirs; or remainder estate, which is that which is left from a life estate.
The remnant of an estate that the grantor holds after he's granted a life estate to another person, if the estate will return to the grantor, is called:
A) reversionary interest
B) reversionary right
C) reversion
D) remainder estate
The correct answer is "C - reversion " Try to remember reversion is in regard to the remnant reverting to the grantor, or reverter. Don't confuse this with reversionary interest, which is the future interest that reverts to a grantor or his heirs; reversionary right, which is the return of the rights of possession of the property to the lessor at the end of a lease; or remainder estate is that which is left from a life estate.
A payment by a tenant, held by a landlord during the lease term, is called:
A) earnest money
B) security deposit
C) consideration
D) lien
The correct answer is "B - security deposit " A security deposit is what a renter gives as a "down payment," while a buyer pays earnest money. Earnest money is a form of "consideration," given to induce a party to enter into a sales contract. A lien is a financial encumbrance AGAINST a property.
The possession of land by one who claims to own at least an estate for life is known as:
A) seisin
B) statutory lien
C) special use permit
D) covenant against encumbrances
The correct answer is "A - seisin " Seisin is also known as the covenant of seisin, in which the grantor warrants that he is the owner of a property and has the right to convey it. Don't confuse that with other "covenants" covered in these courses - the covenant of quiet enjoyment, which means the grantee has the right to enjoy his property; the covenant of further assurance, which tells the grantee he has what he needs to make the title good, or the covenant against encumbrances, which offers protection against encumbrances.
The grantor guarantees that the grantee's title is good against anyone who challenges the grantee's ownership is called:
A) covenant of seisin
B) covenant of further assurance
C) covenant of quiet enjoyment
D) covenant against encumbrances
The correct answer is "C - covenant of quiet enjoyment " Covenant of quiet enjoyment basically means that the grantee has the right to enjoy his property without being challenged. Don't confuse that with other "covenants" covered in these courses - the covenant of seisin, in which the grantor warrants that he is the owner of a property and has the right to convey it ; the covenant of further assurance, which tells the grantee he has what he needs to make the title good, or the covenant against encumbrances, which offers protection against encumbrances.
In this situation, the grantor promises to obtain and deliver any instrument needed to make the title good is the:
A) covenant of seisin
B) covenant against encumbrances
C) covenant of quiet enjoyment
D) covenant of further assurance
The correct answer is "D - covenant of further assurance " To remember this, keep in mind that this covenant ASSURES the grantee that he has what he needs to make the title good. Don't confuse that with other "covenants" covered in these courses - the covenant of seisin, in which the grantor warrants that he is the owner of a property and has the right to convey it; the covenant of quiet enjoyment, which says the grantee has the right to enjoy his property without being challenged; or the covenant against encumbrances, which offers protection against encumbrances.
A situation in which the grantor warrants that the property is free from liens and encumbrances is:
A) covenant of seisin
B) covenant of further assurance
C) covenant of quiet enjoyment
D) covenant against encumbrances
The correct answer is "D - covenant against encumbrances " This covenant is easy to remember, since the title is the same as what it protects against - encumbrances. Don't confuse that with other "covenants" covered in these courses - the covenant of seisin, in which the grantor warrants that he is the owner of a property and has the right to convey it; the covenant of further assurance, which tells the grantee he has what he needs to make the title good, or the covenant of quiet enjoyment, which says the grantee has the right to enjoy his property without being challenged.
The situation in which a grantor promises that if at any time in the future the title fails, he will be liable, is known as:
A) covenant of seisin
B) covenant of warranty forever
C) covenant of quiet enjoyment
D) covenant of further assurance
The correct answer is "B - covenant of warranty forever " Think of the covenant of warranty forever as what it literally is - a warranty that lasts forever. Don't confuse that with other "covenants" covered in these courses - the covenant of seisin, in which the grantor warrants that he is the owner of a property and has the right to convey it; the covenant of further assurance, which tells the grantee he has what he needs to make the title good, or the covenant of quiet enjoyment, which says the grantee has the right to enjoy his property without being challenged
A point, line, or surface from which elevations are measured is known as the:
A) point of beginning
B) datum
C) township
D) section
The correct answer is "B - datum " The datum is a measurement that applies to elevations. While "points of beginning" also deal with measurements, these concern surface measurements. Both townships and sections involve property surveys, too, but do not concern elevations.
The type of description uses the boundaries and measurements of the land in question is known as what type of system?
A) metes-and-bounds
B) government survey
C) lot-and-block system
D) substitution
The correct answer is "A - metes-and-bounds " Metes-and-bounds descriptions describe BOUNDARIES and measurements of the land. Don't confuse this with the government survey system, or rectangular survey system, which uses principle meridians and base lines, or the lot-and-block system, which involves the lots and block numbers specified on a recorded subdivision plat. Remember that substitution is an APPRAISAL principle, not a survey method.
The type of survey system that is based on sets of intersecting lines, which are principal meridians and base lines, is known as:
A) metes-and-bounds
B) government survey
C) lot-and-block system
D) anticipation
The correct answer is "B - government survey " The government survey system, or rectangular survey system, is the form of survey that uses principle meridians and base lines -- think of lines forming rectangles. Don't confuse this with the metes-and-bounds survey system, which describes boundaries and measurements, or the lot-and-block system, which involves the lots and block numbers specified on a recorded subdivision plat. Remember that anticipation is an APPRAISAL principle, not a survey method.
The illegal activity that occurs when competing brokers get together to set commission rates is called:
A) price-fixing
B) group boycotts
C) redlining
D) blockbusting
The correct answer is "A - price-fixing " Price-fixing is the situation of competing brokers getting together to set commission rates. Don't confuse this with another violation of the Sherman Antitrust Act, group boycotting (conspiring to drive a company out of business by boycotting it). Neither redlining nor blockbusting are antitrust violations - they are Fair Housing violations.
This illegal activity is a conspiracy to boycott a firm and drive it out of business. This is known as:
A) price-fixing
B) redlining
C) blockbusting
D) group boycotts
The correct answer is "D - group boycotts " Group boycotts happen when a group conspires to drive a company out of business by boycotting it. Don't confuse this with another violation of the Sherman Antitrust Act, price-fixing, in which competing brokers get together to set commission rates. Neither redlining nor blockbusting are antitrust violations - they are Fair Housing violations
The type of loan that allows, at the end of the term, that the entire debt is paid off, is known as a:
A) straight loan
B) adjustable rate mortgage
C) fully amortized loan
D) partially amortized loan
The correct answer is "C - fully amortized loan " A fully amortized loan is FULLY paid off at the end of the loan term. Don't confuse this with a partially amortized loan, which is a combination of a fully amortized loan and a term or straight loan; a straight loan, which contains a straight payment plan; or an adjustable rate mortgage.
The type of plan for a loan calls for payments of interest only, with the principal to be paid in full at the end of the loan term is called a(n):
A) straight loan
B) adjustable rate mortgage
C) fully amortized loan
D) partially amortized loan
The correct answer is "A - straight loan " A straight loan contains a STRAIGHT payment plan. Don't confuse this with a partially amortized loan, which is a combination of a fully amortized loan and a term or straight loan; an adjustable rate mortgage; or a fully amortized loan, which is FULLY paid off at the end of the loan term.
The type of mortgage that shifts the risk or reward of changing interest rates from the lender to the borrower is called:
A) an adjustable-rate mortgage
B) straight loan
C) fully amortized loan
D) partially amortized loan
The correct answer is "A - an adjustable-rate mortgage " An adjustable rate mortgage is one in which the risk or reward of changing interest rates is shifted from the lender to the borrower. Don't confuse this with a straight loan, which has a straight payment plan; a partially amortized loan, which is a combination of straight loan and fully amortized loan; or a fully amortized loan, which is fully paid off at the end of the loan term.
The originally scheduled number of years for a loan is also called the:
A) lien
B) encumbrance
C) term
D) period
The correct answer is "C - term " A term is the original time period of the loan. Liens and encumbrances have to do with the property itself.
One of the two types of encumbrances, under which restrictions and easements fall, is known as:
A) usage encumbrances
B) liens
C) a voluntary lien
D) an involuntary lien
The correct answer is "A - usage encumbrances " Usage encumbrances is one of the two types of encumbrances. The other type is liens of all types, including those listed here.
A lien placed against a specific property by workers or suppliers who have not been paid for labor or materials used in construction or improvements to the property is known as:
A) a statutory lien
B) a voluntary lien
C) an equitable lien
D) a mechanic's lien
The correct answer is "D - a mechanic's lien " A mechanic's lien, as the name states, is placed by mechanics, other workers, or suppliers of materials. Don't confuse this with voluntary liens, created by choice, equitable liens, created by agreement, or statutory liens, created by law.
The type of lien which takes priority over all other liens, and has the first claim against a property is called:
A) a tax lien
B) a judgment lien
C) a mechanic's lien
D) a mortgage lien
The correct answer is "A - a tax lien " Real estate tax liens generally take priority over all other liens. Once tax liens are satisfied, other liens would be handled in the following order: mortgage liens, then judgment liens, and then mechanics' liens.
Addition to the land through natural causes, usually by a change in water flow.
A) accession
B) acquisition
C) accretion
D) annexation
The correct answer is "C - accretion " Remember, accretion always has to do with natural causes, like a river or creek (think “accreektion”), while accession is the acquisition of title as a result of annexation of fixtures or accretion.