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146 Cards in this Set

  • Front
  • Back
Freedom to own land
Allodial System
No two parcels are identical
Nonhomogeneity
Improvements on land
Structures
Economic Characteristics
Scarcity (Limited Supply)
Situs (Location/Site)
Durability (Permanence of Improvements)
3 Hereditaments
Land, Tenemants & Incorporeal Rights
Rights of Government
You own the land, but the government determines how you use it
Eminent Domain
Government can condemn property and offer fair value to owners and using for public purposes
Escheat
If someone dies, and there are no heirs or wills left behind - then the property reverts back to the state
Police Powers
Regulation of use of land (NOT the taking of it)
Personal Property
Chattel: Property that is movable in nature, such as a chair or table. Is not Real Property
Fixtures
Items of personal property that become real once they're affixed to real estate. Ex: Cabinets, Light Fixtures, bookcases, etc.
Codicil
A written amendment to an existing will
Voluntary Alienation
When an owner voluntarily sells.
Devise
Will states who is to inherit the real property
Descent
When someone dies inestate (without a will), the home passes through probate and to the next heir.
Adverse Possession
NOT squatter's rights. Rightful owner loses land to occupant who has taken possession in hostile, distinct, and actual way for the statutory period.
Foreclosure
Bank takes home as collateral for defaulted loan
Meridians
North & South (36 in all)
Parallels
East & West (32 in all) 66 miles, or 1 degree apart.
Correction Lines
Every 24 miles on the meridians to correct curvature of earth
Check
24 square miles = 16 townships
Townships
Contains 36 sections. Every section is 6 square miles or 640 acres.
Freehold
Indefinite duration of ownership. (Fee Simple Absolute)
Fee Simple Absolute
A freehold estate. Allowed to sell, will or giveaway property. Subject to gov't. regulation/restriction & OWNER has MOST power.
Fee Simple Defeasible
(Conditional) Limits estate holder to terms set by grantor. If conditions aren't met, land reverts to grantor, heirs or reversioner.
Fee Simple to a Condition Subsequent
Gives same rights as Fee Simple Defeasible, but grantor must step in if conditions are broken or estate holder can proceed with plans.
Life Estate
Granted through will or deed by the law w/o owner's consent.
Nonfreehold Estates
"Leasehold Interests" Give possessory rights for some specific amount of time. No ownership - LEASING
Title
Evidence of ownership (intangible)
Deed
Document that conveys grantor's interest in property to the grantee (transfers ownership).
Remainderman
Named by original grantor for provisions upon life tenant's death.
Reversionary
Estate reverts back to grantor or grantor's heirs at some point.
Acknowledged
Sworn under oath.
Consideration
Price paid for property (can be, "for love & affection," etc)
Livery of Siezin
Act of transferring deed
Notarized signatures on deed
Validity of signatures, NOT contract
Constructive Notice
Newspaper/Recorder's office give, "Notice to the world." "Any claimaints against John Doe, notify..." then one can place a lien.
What is on a deed?
Consideration, Words of conveyance, Description, Restrictions, Quality & Quantity and Signatures
Restrictions to the deed
"Subject to assessments, taxes or easements." Ex: If a property has restricted building laws, etc.
Specialty Warranty Deed
Only warrants the deed/title was clear during grantor's ownership
Quitclaim Deed
Grantor may not have clear title. Biggest risk is taken by buyer, grantor takes no liability. Ex: Liens, judgements, etc may still be owed.
Sheriff's Deed
Repossessed homes
In Joint Tenancy, ALL tenants must have the same:
Timeframe, title, interest & possession.
Unilateral Contract
"If I sell your house, you pay me commission." Does not bind agent to perform. ONE PARTY COMPLETES ACT.
Implied Contract
Not enforceable
Expressed Contract
Written or oral
Bilateral Contract
Lease: Promises of both parties
Executory Contract
Also a lease contract, has not yet been completed. Will be completed after a promise is completed.
5 Elements of a Contract
Offer & Acceptance, Consideration, Capacity of Parties, Legality of Object, and Written/Signed
Statute of Frauds
Requires ALL real estate transfers be in writing.
Parole Evidence Rule
Prohibits PRIOR verbal or written evidence (prior to purchase agreement) to altar purchase agreement.
Discharging of a Contract (4)
Damage to Property, Death, Recession by Mutual Agreement, Partial Performance
Latent Defects
Hidden (Plumbing, Electrical, etc)
Patent Defects
Obvious Defects (Cracks, etc)
Principal
Client
Customer
3rd Party (Hasn't yet signed agreement with agent)
Limited Time Special Agency
Contracts w/ both buyer & seller are for a limited time.
Limited Purpose Special Agency
Representing for a specific purpose (EX: 2 BR, 2 Ba)
Limited Authority Special Agency
Agent hired to sell or lease as directed by contract. Power of Attornery to Agent (EX: while client is out of country)
General Agency
Can literally "speak" for principal when a principal places preset conditions (Ex: Every time a farm in SW Iowa comes up for sale).
Seller Agency
Agent works for seller
Buyer Agency
Seller pays all commissions in Nebraska
Sub-Agency
Must represent just like agent, keep principal's interest in mind. Must be licensed unless not talking numbers.
Comparable Market Analysis
Compares similar properties, square footage, valuations, etc.
Exclusive Right-to-Sell
Contract that gives real estate firm the sole right to act as agent for the seller.
Listing Contract Must have (4)
Legal Description, Expiration Date, Amount of Commission & when its paid, Signatures
Exclusive Agency
When the agent is paid commission if the house sells, but if the owner sells themselves, they DO NOT have to pay agent.
Flat Fee Listing
DISCOUNT BROKERS - Always exclusions.
Discount Broker
Charges fee at less than prevailing/going rate.
Agent Compensation
No set commission rate, fee is negotiable and is set in contract.
Terminate a Listing
Until listing expires or sale of house unless BOTH mutually agree to cancel contract.
Anti-Trust Laws
Commission payable is negotiable - not mandated or regulated by an agency.
Net Listing
A property listed at an agreed upon net price and the broker receives anything over and above the net listing as earned commission.
Earnest Deposit
Purchaser gives to the broker at the time of written contract to is offered. It binds contract and demonstrates buyers intent.
Lease Option
Leasing with the option to buy within a certain timeframe.
Mutual Savings Bank
Primarily in Northeast, all state chartered. Favor long-term, low-risk investments. No stockholders.
Truth-In-Lending Law
Federal Reserve used "REGULATION Z" to enforce all 'finance' specifics on loans be disclosed. IE: true APR, date charges commence, pay-off penalties, etc.
FHA Loan Maximum, Percentage and who its intended for
Usually first-time home buyers with less-than-perfect credit. Maximum loan is $271K or 97.75% of sale price.
Truth-in-Lending Act & what enforces it
States the consumer must know exactly how much it's costing them to borrow... enforced by Regulation Z
What, exactly, does Regulation Z do?
Regulates how APR and other loan specifics are advertised. Banks have especially stringent guidelines.
RESPA (Real Estate Settlement Procedures Act)
Illegalizes kickbacks and any exchange of "perks" for business. IE: Agent & Loan Officer. ALSO: limits amt of escrow lender can require.
HUD Statement
Let's everyone know exactly how much the transaction costs
VA Loans
At 2.25% for first-time, doubles with second mortgage
National Flood Insurance
Every house must be evaluated to see if it qualifies for a flood plain - if so, must carry flood insurance.
CRA - Community Reinvestment Act
Requires lenders INCLUDE all neighbors and not redline based on race, culture, religion, etc.
FHA-Insured Loan
Insures the loan in event of foreclosure.
FHA 203B Loan
For 1-4 Family Housing, Requires Minimum Down Payment, Excludes any Investor Financing, First or (rarely) 2nd homes, Seller can pay closing if buyer has 3% down, Can accept gift for down payment
FHA Loan Assumptions (4)
1) Must pass credit check 2) Can only be assumed by a buyer occupying property 3)No Investors 4) Mortgage payment must not equal more than 29% of their gross monthly income
FHA ARM (Adjustable Rate Mortgage)
Typically adjusts once per year.
VA Loan Assumption
Don't have to be a vet to assume a VA loan.
VA/FHA Inspections
Required on any home that wishes to use a VA/FHA Loan. Not all appraisers are certified and it is additional (typically $100+)
RECD (Rural Economic Community Development)
Federal Lender w/ US Dept of Agriculture, Offers Low Interest Rates in areas of <20K people, buyer must have limited income.
Land Contracts
No Lender; Seller if financer. Many times for bare land (as there are no mortgages for structureless property), seller has ownership until terms are fulfilled.
FICA Scores of less tha 680
Result in difficulty getting conventional loans.
Discount Point
1 discount point = 1% of the loan amount. EX: If a lender charges 2 points on a $30,000 loan, the lender will receive 2 percent of $30K, or $600.
Loan-to-Value (LTV)
Buyer can only get a loan for the sale price or appraised price - whichever is less.
Mortgage
Pledges property for collateral debt.
Alienation Clause
Allows lender to call balance due & payable upon sale of property. AKA: Due-on-sale Clause... BASICALLY SAYS a property will be foreclosed on if buyer does not pay mortgage.
Hypothecation
Pledging property without giving up possession (having a mortgage)
Mortgagee
Creditor
Mortgager
Buyer
Who gives the acknowledgement on a deed?
Notary
Which deed carries the least liability for the seller?
Quitclaim deed
What term is defined as the government or local government can take land if they think it can be used better in another manner?
Eminent Domain
Does the grantor (owner) or grantee (buyer) sign the deed?
The Grantor MUST sign, the grantee is optional.
What sets covenance and/or guidelines for how property may be used?
Restriction
Title is transferred once______.
It's been delivered and accepted.
What is the term when an owner leaves no will or heirs, and as such, the property reverts back to the state?
Escheat
Freehold Estate
NON-LEASEHOLDING, ownership is free & clear.
What term says the government can control/restrict the use of property?
Police Power
This is sold by means of a bill-of-sale and refers to personal property.
Chattel
Why is a deed recorded?
To give notice to the world (and make notice for any potential lienholders)
Reversion of property to the state...
Escheat
What is the initial buyer payment called?
An earnest deposit
Most options (w/o consideration) are...
Unenforceable
Optioner is also called ______
Owner
Listing Contract Must Have (4)
Consideration, Signatures, Expiration Date & Legal Description
Optionee is also known as______
Buyer
An implied agency, usually unenforceable is a _________ agency
Estoppel
An earnest deposit is returned to the buyer if _________
The offer was never presented to the seller.
Money is NEVER disbursed ______ closing.
BEFORE
When does a title transfer in a leasehold?
Never
Reverse Mortgage
Allows owners to receive payments for equity in property. The balance is settled upon the sale of the deceased's estate.
2 Loans that are secured by 1 loan
Blanket Mortgage
Term Mortgage
For a certain period of time.
A Mortgage plan where payments increase every year to reduce the # of years it takes to pay off.
GEM - Growing Equity Mortgage
The legal right to delay the meeting of financial obligation.
Moratorium
True or False: FHA Loans are assumable.
FALSE
Parole Evidence Role
Does not allow verbal or written changes made before the closing to change the purchase agreement.
Unilateral Contract
Example: Option Contract. When one party must fulfil an obligation/promise.
Broker's Trust Account
Where agents/brokers can deposit money belonging to others (interest free).
Net Listing
When a broker agrees to sell the house for a set commission plus anything over the asking price that the house sells for.
Listing Contract can be terminated when...
the seller/agent mutually rescind.
Fiduciary Responsibilities
A person entrusted to exercise skill & knowledge in a client's transaction and keeps the best interest of the client at the forefront.
3 Discount points =
3% of the loan amount
VA Eligibility
Must secure CERTIFICATE OF ELIGIBILITY saying they will occupy home, no prepayment penalty, by 4 tiers of loans.
What are the 4 tiers of VA Loans?
Veteran, National Guard, Reservist, 2nd Use of Benefit
FHA & VA loans both include an ______ clause.
Escape
FHA-insured loans insure the ________.
Mortgagee (creditor)
True or False: Deeds have to be recorded.
False.
Devisee
A person that inherits property due to a will.
Life estates can be created by ______ or a __________.
A deed or will.
What's the difference between client and principle?
Nothing, they are interchangeable.
What are the conditions of a SPECIAL AGENCY?
Limited time, limited purpose and Limited autority.
Dual Agency occurs when ______
The agent represents both parties in the contract. (Buyer & Seller agent)
Exclusive Agency
When an agent is hired to sell the property, but the seller also retains the right to sell himself w/o paying commission.