Pa Real Estate Study Guide (Chapters 22-24)

Front 1

Property manager's 3 principal responsibilities

Back 1

1. Fiscal Management
2. Physical Management
3. Administrative Management

Front 2

Why must documents be recorded in the correct order?

Back 2

To avoid defect in title

Front 3

CLO (computerized loan origination) services are subject to regulation by:

Back 3

RESPA

Front 4

2 characteristics of a property manager

Back 4

-Maintains owners investment
-Ensures the property produces income

Front 5

Lender not permitted to collect tax/insurance escrow payments of more than...

Back 5

Two months

Front 6

Title Expenses

Back 6

Usually paid by buyer - rate set by Pennsylvania Title Insurance Rating Bureau

Front 7

Type of agent the property manager usually is....

Back 7

General Agent (as opposed to special agent)

Front 8

T or F? In PA, a property manager serving the public for a fee must be a licensed real estate broker.

Back 8

True

Front 9

2 types of proration calculations

Back 9

360 day year "banking year" or 365 day (or 366 for leap yr.) known as "actual year

Front 10

prorated

Back 10

divided

Front 11

Deed preperation fee paid by

Back 11

Seller

Front 12

In CLO (computerized loan origination) systems what can brokers charge for providing mortgage loan accessing service?

Back 12

A "fair fee" - Must be paid by borrower (not lender or broker)

Front 13

Consumation of real estate transaction

Back 13

Closing or Settlement

Front 14

How buyer determines he is taking good title to the property

Back 14

Obtains abstract of title or title commitment from title insurance (Buyer's responsible)

Front 15

Seller assures that there has been no judgments since the date of title examination with this....

Back 15

Affidavit of title

Front 16

Title Expenses

Back 16

Usually paid by buyer - rate set by Pennsylvania Title Insurance Rating Bureau

Front 17

Interrelated companies that offer real estate-related services are called:

Back 17

Controlled business arrangements (CBA's - One stop shopping)

Front 18

Accrued items

Back 18

Buyer credits (prorated expenses that are owed by seller, later will be paid by the buyer)

Front 19

Point at which ownership is transferred in exchange for selling price

Back 19

Closing

Front 20

For settlement, special assessments are usually paid when?

Back 20

Seller normally pays current installment, buyer assumes future installments

Front 21

Two things a buyer should check before closing

Back 21

Physical condition of property - Condition of title

Front 22

On PA Licensing exam, for prorations, what are the lengths of months a& years (in days?)

Back 22

30 days to a month. - 360 days in a year. (In practice however, prorations are based on 365 day year)

Front 23

For a licensee to represent a party at closing, licensee must be....

Back 23

authorized to act as principal's agent under power of attorney

Front 24

RESPA permits CBAS as long as...

Back 24

consumer is informed of relationships - Fees may not be exchanged for simply referrals

Front 25

Amount to be paid by seller or buyer

Back 25

Debit (or charge)

Front 26

Last day seller owns property:

Back 26

Prorations are usually made to and including the day of closing

Front 27

This creates an agency relationship between property owner and property manager.

Back 27

Management Agreement

Front 28

Main concerns of closing

Back 28

Buyer receives marketable title, seller recieves purchase price

Front 29

Like any agent in real estate, the management agreement should be...

Back 29

in writing.

Front 30

Management Agreements should include:

Back 30

Description of property; time period; definition of responsibilities; statement of owners purpose; extent of authority; reporting; compensation; allocation of costs; equal opportunity statement

Front 31

Who is responsible for calculating the official settlement statement?

Back 31

Closing officer

Front 32

Budget based on anticipated revenues and expenses

Back 32

Operating budget

Front 33

A property manager might be an employee of:

Back 33

Owner of real estate (might not be licensed if residential multifamily dwellings)

Front 34

Expenditures charged against the property's income for modernization or renovation

Back 34

Capital expenditure

Front 35

Agency that administers RESPA

Back 35

HUD

Front 36

Measurment of initial and operating cost of equipment over its entire useful life.

Back 36

Life cycle costing

Front 37

Buildings that provide internal communications infrastructure are:

Back 37

dark wired

Front 38

Disclosure Obligations for settlement

Back 38

Special Settlement info booklet from HUD - Good faith estimate of settlement costs (No later than 3 days after acceptance of loan application)- Uniform Settlement Statement (HUD-1 form)

Front 39

What primarily influences rental rates?

Back 39

Supply and demand

Front 40

Amount payable to buyer or seller

Back 40

Credit (amount entered in person's favor)

Front 41

In establishing rental rates, property manager has 4 long-term considerations:

Back 41

1. Rent income must be sufficient to cover operations
2. Income must provide fair return on investment
3. Rents should be in line with comparables.
4. Vacancy rates should be monitored for rent increases.

Front 42

Prepaid items

Back 42

Seller credits (expenses to be prorated that have been prepaid by the seller, but not fully used up - i.e. taxes)

Front 43

Serious consideration to raising rents should be given when occupancy levels exceed:

Back 43

95%

Front 44

Why do some commercial leases bar the introduction of similar businesses?

Back 44

Helps diversify owner's investment and makes profitability more likely.

Front 45

One page notice signed on or before closing explaining difference between appraisal and home inspections

Back 45

Consumer Notice form

Front 46

3 provisions should be in lease agreements regarding rental payment

Back 46

1. time & place of payment
2. penalties for late payments
3. provisiions for cancellations and damages in case of nonpayment

Front 47

A property manager's primary maintenance objective:

Back 47

Protect the physical integrity of the property over the long term.

Front 48

Abstract may not be accurate as of the date of settlement so a second search is done known as:

Back 48

Bring Down

Front 49

4 types of maintenance required to keep property in good condition:

Back 49

1. Preventive maintenance
2. Repair or corrective maintenance
3. Routine maintenance
4. Construction

Front 50

Regularly scheduled maintenance activities such as painting, seasonal service, appliances.

Back 50

Preventive maintenance

Front 51

Computations for prorations are carried how many decimal points?

Back 51

3, then rounded off to cents after final proration.

Front 52

T or F? Buyer's assumption of sellers existing loan is covered by RESPA?

Back 52

False

Front 53

Alterations to the interior of building to meet a tenant's particular needs (especially commercial)

Back 53

Tenant improvements

Front 54

Obligates employers and property managers to adopt nondiscriminatory employment practices

Back 54

Title I of ADA and the Pennsylvania Human Relations Act (PHRA)

Front 55

Borrower has the right to inspect HUD-1 statement when?

Back 55

1 business day before closing - Lender must retain statement for 2 years after closing date.

Front 56

Prohibits discrimination against people with disabilites by ensuring access and enjoyment of services.

Back 56

Title III of ADA

Front 57

Fee usually paid by seller as a filing fee

Back 57

Recording expenses - Buyer pays recording charges in connection w/ actual transfer of title.

Front 58

Four alternative risk management techniques (acronym)

Back 58

Control it
Avoid it
Retain it
Transfer it
CART

Front 59

An insurance package that might include standard types of commercial coverage PLUS special coverage for natural disasters

Back 59

Multiperil policies