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59 Cards in this Set

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Property manager's 3 principal responsibilities
1. Fiscal Management
2. Physical Management
3. Administrative Management
Why must documents be recorded in the correct order?
To avoid defect in title
CLO (computerized loan origination) services are subject to regulation by:
RESPA
2 characteristics of a property manager
-Maintains owners investment
-Ensures the property produces income
Lender not permitted to collect tax/insurance escrow payments of more than...
Two months
Title Expenses
Usually paid by buyer - rate set by Pennsylvania Title Insurance Rating Bureau
Type of agent the property manager usually is....
General Agent (as opposed to special agent)
T or F? In PA, a property manager serving the public for a fee must be a licensed real estate broker.
True
2 types of proration calculations
360 day year "banking year" or 365 day (or 366 for leap yr.) known as "actual year
prorated
divided
Deed preperation fee paid by
Seller
In CLO (computerized loan origination) systems what can brokers charge for providing mortgage loan accessing service?
A "fair fee" - Must be paid by borrower (not lender or broker)
Consumation of real estate transaction
Closing or Settlement
How buyer determines he is taking good title to the property
Obtains abstract of title or title commitment from title insurance (Buyer's responsible)
Seller assures that there has been no judgments since the date of title examination with this....
Affidavit of title
Title Expenses
Usually paid by buyer - rate set by Pennsylvania Title Insurance Rating Bureau
Interrelated companies that offer real estate-related services are called:
Controlled business arrangements (CBA's - One stop shopping)
Accrued items
Buyer credits (prorated expenses that are owed by seller, later will be paid by the buyer)
Point at which ownership is transferred in exchange for selling price
Closing
For settlement, special assessments are usually paid when?
Seller normally pays current installment, buyer assumes future installments
Two things a buyer should check before closing
Physical condition of property - Condition of title
On PA Licensing exam, for prorations, what are the lengths of months a& years (in days?)
30 days to a month. - 360 days in a year. (In practice however, prorations are based on 365 day year)
For a licensee to represent a party at closing, licensee must be....
authorized to act as principal's agent under power of attorney
RESPA permits CBAS as long as...
consumer is informed of relationships - Fees may not be exchanged for simply referrals
Amount to be paid by seller or buyer
Debit (or charge)
Last day seller owns property:
Prorations are usually made to and including the day of closing
This creates an agency relationship between property owner and property manager.
Management Agreement
Main concerns of closing
Buyer receives marketable title, seller recieves purchase price
Like any agent in real estate, the management agreement should be...
in writing.
Management Agreements should include:
Description of property; time period; definition of responsibilities; statement of owners purpose; extent of authority; reporting; compensation; allocation of costs; equal opportunity statement
Who is responsible for calculating the official settlement statement?
Closing officer
Budget based on anticipated revenues and expenses
Operating budget
A property manager might be an employee of:
Owner of real estate (might not be licensed if residential multifamily dwellings)
Expenditures charged against the property's income for modernization or renovation
Capital expenditure
Agency that administers RESPA
HUD
Measurment of initial and operating cost of equipment over its entire useful life.
Life cycle costing
Buildings that provide internal communications infrastructure are:
dark wired
Disclosure Obligations for settlement
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)
What primarily influences rental rates?
Supply and demand
Amount payable to buyer or seller
Credit (amount entered in person's favor)
In establishing rental rates, property manager has 4 long-term considerations:
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.
Prepaid items
Seller credits (expenses to be prorated that have been prepaid by the seller, but not fully used up - i.e. taxes)
Serious consideration to raising rents should be given when occupancy levels exceed:
95%
Why do some commercial leases bar the introduction of similar businesses?
Helps diversify owner's investment and makes profitability more likely.
One page notice signed on or before closing explaining difference between appraisal and home inspections
Consumer Notice form
3 provisions should be in lease agreements regarding rental payment
1. time & place of payment
2. penalties for late payments
3. provisiions for cancellations and damages in case of nonpayment
A property manager's primary maintenance objective:
Protect the physical integrity of the property over the long term.
Abstract may not be accurate as of the date of settlement so a second search is done known as:
Bring Down
4 types of maintenance required to keep property in good condition:
1. Preventive maintenance
2. Repair or corrective maintenance
3. Routine maintenance
4. Construction
Regularly scheduled maintenance activities such as painting, seasonal service, appliances.
Preventive maintenance
Computations for prorations are carried how many decimal points?
3, then rounded off to cents after final proration.
T or F? Buyer's assumption of sellers existing loan is covered by RESPA?
False
Alterations to the interior of building to meet a tenant's particular needs (especially commercial)
Tenant improvements
Obligates employers and property managers to adopt nondiscriminatory employment practices
Title I of ADA and the Pennsylvania Human Relations Act (PHRA)
Borrower has the right to inspect HUD-1 statement when?
1 business day before closing - Lender must retain statement for 2 years after closing date.
Prohibits discrimination against people with disabilites by ensuring access and enjoyment of services.
Title III of ADA
Fee usually paid by seller as a filing fee
Recording expenses - Buyer pays recording charges in connection w/ actual transfer of title.
Four alternative risk management techniques (acronym)
Control it
Avoid it
Retain it
Transfer it
CART
An insurance package that might include standard types of commercial coverage PLUS special coverage for natural disasters
Multiperil policies