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386 Cards in this Set

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  • Back
Property
-Rights or interests in the things owned.
Real Property
-Immovable.
-Bearing Wall.
-Not leasehold estate.
Fixture
-Incorporated into land.
-Not Cost.
-Time of attachment.
Trade Fixtures
-Business Office
Run with the land
-Appurtant.
-Easement, water company stock, covenant, minerals.
-No seperate conveyance.
Personal Property
-Hypothecated, alienated, becomes real property.
Fee Simple Estate
-Estate in Fee
-Indefinate Duration.
-Freehold
-Most Interest
-Not free of encumbrance
-Inheritance
Fee Simple Defeasible
-No Alcolhol
Life Estate - Property is Leased
Owner dies, lease terminates.
Less-Than-Freehold Estates
-Lessees
-Not neccessary to sign.
-6 months, estate for years.
-personal property - chattel real
Sublease
-Transfers possession.
-Can sublease or assign of not mentioned.
Quiet Enjoyment
Paramount
Abandonment
Tenenat leaves volutarily
Percentage Lease
Based on gross receitps.
Security Deposit
furnished or not
Estate for years
fixed period
License
personal, revokable
Title Vesting
Tenency = Method
Severalty
Individual
Joint Tenancy
-Cannot Will
-Free of unsecured debt.
T - Time
T - Title
I - Interest
P - Possession
Tenancy in Common
-Can Convey seperately
-Unity of possession
Community Property
Husband and wife
Agreement to sell
unenforceable
Cloud on title
Single woman married
Quiet Title Action
remove a cloud
Alienation
convey
opposite of acquisition
Eminment Domain
For public use taken by the government.
-Individuals do not have.
-owner must be paid just compensation.
Police Power
Zoning
Escheat
Individuals cannot use.
Accretion
Natural Causes
Avulsion
Dam breaks
Probate Sale- Commission
set by court
Intestate Succession
no will
Deeds - Purpose
Transfer Interest
Grant Deed
-Executed when signed.
-not neccessary to record
Quitclaim Deed
-convey rights of grantor
-no covenants
Deed Essentials
-granting clause
-legal compentance of grantor
-not acknowledged
-delivered and accepted
Constructive Notice
-given by recording
Acknowledgment
-employee without interest
Encumbrances
limit title
Easements
encumbrance
Prescriptive Easements
-no confrontation with owner
-can easily be terminated for non use.
termination of easement
dominent tenement records quitclaim deed
appurtenant easement
buyer has same rights
confirmed by
quiet title suit (court action)
privated restictions
-15,000 square feet
-grantor or developer
condition
penalties are more severe
public restrictions
-public health, safety, moral and general welfare.
-one lot = variance
zoning changes initiated by
owner, subdivider, government
commercial to residencial
down zoning
multi-family zone
R-3
encroachments
sue neighbor for trespass
Liens
-a charge imposed
-a trust deed or mortgage
Specific Lien
trust deed
General Lien
all property (everything you owe)
Promissory note
evidence of debt
amortization
liquidation
level payment
payment applied to principal increases
negative amortization
payments do not cover interest
GPAM Loan
difers some principal payments
Interest Rates Affected by
not unemployment
Simple Interest
home loans
Variable interest
rate can increase or decrease
Effective interest rate nominal interest rate
-rate paid
-rate specified in note
Negotiable instrument
not a mortgage
Straight Note
No principal payments made
Balloon Loan
-partially amortized
-entire balance due
Holder in Due Course
Now knowledge of defects
Discounting
selling for less
Default
foreclose for $15,000 (full amount)
More than once borrower
jointly and severally
Trustor
signs the deed
Beneficiary
-loans money
-consent for consolidation and new restrictions
Right to Sell
trustor to trustee
Terminated
reconveyance deed
Court Sale
-One year redemption period
-trustor possesses property
Trustee's Sale
-3 months before publishing
-right of reinstatement
-most expedient
Deed in Lieu of Foreclosure
Lender assumes junior liens
Request for notice protect
beneficiary of second loan
Lender's Basic Protection
borrowers equity
Priority
recorded first
Release Clause
Releases portions of the property
Assume
Relieves seller
Subject to
seller liable, buyer not liable
subordination Clause
future loans have priority
Acceleration Clause
unpaid sum due
open-end
borrow additional money
beneficiary statement
gives current balance
prepayment penalty
trustor makes advance payments
Mechanics Liens
verified and recorded
Priority
-beginning of construction
-earlier than recording
-could impare trust deed
Notices
completion, cessation, non-responsibility
Lis Pendens
May affect title
Lis Pendens is Effective Until
judgement rendered or lawsuit dismissed
Writ of Execution
court order to sell
Injunction
court order to stop
chain of title
important when deciding to issue title insurance
abstract of title
written summary of documents
preliminary report
-seller is trustor
-need to remove mechanic liens
Standard Policy of Title Insurance
-most buyers obtain
-no survey or onsite inspection
Protects Against
-forgery
-improper delivery
Extended Policy
covers improvements on adjoining land
ALTA Policy
Includes a survey
Exclusions
zoning
Search
county clerk, recorder, federal land office.
Illegal Acts
District attorney prosecutes
Misrepresentations
-obvious, knowledge, caused
-no expenses on income property
Commission to Buyer
must inform seller
Blind Ad
no brokers name
Misleading Ad
-misleading map
-move right in-major repairs
secret profit by non-licensee
no cause for action
referral fees
both broker and salesperson
gifts
-microwaves are ok - reveal to all
-450 is ok
commingling
funds from brokers own property
not a member
not a REALTOR
salesperson as independent contractor
broker still liable for conduct
unlicensed assistant
-broker must read advertising
-must be supervised on internet
-both guilty if solicits buyers or sellers
Manage Property
broker
Loan Broker Laws
disclosure given to borrower when signed
Advertisement
not 1-800-FOR-A-LOAN
Desk cost
total expenses / number of salespersons
company dollar
income - only commission
trust fund account
-seperate trust funds
-any employee (can draw funds)
ethical practices
honestly and fairness
recovery account
only pay recovery account plus interest
selling trust deeds
advertising must include interest rate and discount
Can sell
only if registered
must remove signs
within 48 hours
notice of transfer
within 10 calendar days
Expired License
can be renewed within 2 years of expiration
temporary (150 day) license
deliquent in child support
advanced fee contract
no guarantee of sale or lease
Fair Housing
-1968
-Provide fair housing
-steering
-unenforceable-no effect
-refuse to show when out of town
-blockbusting, panic peddling, not duress
-no descrimination-rejected offeres
-no descrimination against singles
-department of fair employment and housing
-different prices-money damanges
-show same homes
-no gender or ethical quotas
-can refuse to answer (gener, marriage status)
Economic Theory
lost interest on equity is a cost of ownership
Leverage
-$300,000
-Borrow the maximum
Appreciation
trustor
Prices Decrease
value of money increases
Sellers Market
prices rise
Impact Real Estate market
comsumerisn, land use controls
GNP & Employment Rise
income rises, home sales increase
Lenders
-Portfolio risk management concerned with all.
-individual savings
-pay any rate of interest
-"ALWAYS select 'D'"
Insurance Companies
- Large Loans
- Work through mortgage companies
Savings & Loan Assns
-most funds in real estate
-primary source
Mortgage Companies
sell in secondary market
Private Lenders
Juinior loans
Secondary Mortgage Market
resale market place
FHLMC
maintains secondary market
Increase Reserves
decrease loan activity
Tight money
-more second trust deeds
-sellers carry back a second
FNMA
-not a demand source for money
Loan-to-Value
lower ratio, higher equity
Loan Commitment
results of income, borrower and property
Construction Loan
interim
Take out loan
long term
debit-income ratio
loan qualifying tool
mortgage loan
collaterlized by real property
mortgage yield
investors interest return
lender minimize
-substandard loan
-degree of risk most important
late payment
more than 10 days
100% loan
protected by appreciation
amortization table
monthly payment
warehousing
colling loans
FICo score
credit history of borrower
security interest
credits interest in debitors property
discount points
percent of loan amount
preperation charges
loan origination fee.
trusth-in-lending
not agricultural
purpose
meaningful disclosure by lender
annual percentage rate advertising
-cost of credit
-other disclosures not required
right to cancel
residence is collateral
Conditional installment sales contract
-legal title vendor
-security device
- transfers equitable title
default, quitclaim deed
signed by buyer (vendee)
loan insured by
FHA or private insurer
FHA
protects lender against default
VA
-no down payment
-cannot be rental property
Cal-Vet
-land contract
-department of veterans affairs
Insurance
promise of reimburstment for damages
Fire Insurance
neither gain or lose
escrow
financial code
instructions executed by
buyer, seller, third parties
purpose
ters are met
buyer debit
purchase price
credit seller
prepaid taxes
prorations
not unsecured loan
impounds
recurring costs
two termite reports
get instructions from buyer and seller
escrow can
call for funding of loan
report to irs
escrow
move in early
sellers written permission
release disputed funds
instructions from all parties or court order
1-4 family residential dwellings
required
uniform settlement statement
no charge
buyer can require
specific lender
good faith estimate
must be furnished
DISCLOSURES
- Given by
Transferor, even if sold 'as is'
DISCLOSURES
-Must reveal
-all known defects
-not repairs
amended statement
buyer can rescind
licesnsee can never
fill out seller portion
defective statement
buyer can due within two years
Alquist-Priolo
-Requires Disclosure
nearby earthquake fault zones
Alquist-Priolo
-Zone extends
1/4 mile wide along fault lines.
Types of Contracts
-Bilateral
Diligence
Types of Contracts
-Executed
Complete Performed
Types of Contracts
-Voidable
-Binding until rescinded
-duress
-menace or threat
-not illegal purpose
Legal Essentials of a valid contract
not money, performance nor writing
offer & acceptance
must have for real estate contracts
capable parties
minors can acquire
consideration
valuable, good, sufficient, adequate
statute of frauds
if not to be performed within one year, must be in writting.
BREACH
-Specific Performance
not by broker
listings
bilateral employment contract
Agency Creation
-Reveal as soon as possible
-For any period of time
-employment contract
-find purchaser, accept deposit
-payment of consideration not required
-not voluntary offer
-terminated by completion
oral agreement
-commission permissible
-broker would sue broker
lease on duplex
broker is agent
subagent of listing broker
duty to seller only
fiduciary obligations
-licensee
-integrity, loyalty, honesty, confendentiality
present all written offers
-at same time
-unless frivolous or express instructions
listings
bilateral employment contract
seller fires broker
liable for damages
broker owes buyer
fair and honest deal
Agency Creation
-Reveal as soon as possible
-For any period of time
-employment contract
-find purchaser, accept deposit
-payment of consideration not required
-not voluntary offer
-terminated by completion
broker as agent of buyer (offeror)
-can present offers to seller and sellers agent.
-accepting unauthorized deposits
-owes fiducuary duty to buyer only
oral agreement
-commission permissible
-broker would sue broker
lease on duplex
broker is agent
material facts
-must reveal
-leaky roof
-septic tank-rescind
subagent of listing broker
duty to seller only
puffing
exaggerated features or benefits
fiduciary obligations
-licensee
-integrity, loyalty, honesty, confendentiality
broker promises seller to find house
civil suit for damages
present all written offers
-at same time
-unless frivolous or express instructions
agent promises to advertise and does not
actual fraud
seller fires broker
liable for damages
protect confidential information
after listing expires
listings
bilateral employment contract
broker owes buyer
fair and honest deal
Agency Creation
-Reveal as soon as possible
-For any period of time
-employment contract
-find purchaser, accept deposit
-payment of consideration not required
-not voluntary offer
-terminated by completion
oral agreement
-commission permissible
-broker would sue broker
broker as agent of buyer (offeror)
-can present offers to seller and sellers agent.
-accepting unauthorized deposits
-owes fiducuary duty to buyer only
lease on duplex
broker is agent
material facts
-must reveal
-leaky roof
-septic tank-rescind
subagent of listing broker
duty to seller only
puffing
exaggerated features or benefits
fiduciary obligations
-licensee
-integrity, loyalty, honesty, confendentiality
present all written offers
-at same time
-unless frivolous or express instructions
broker promises seller to find house
civil suit for damages
seller fires broker
liable for damages
agent promises to advertise and does not
actual fraud
broker owes buyer
fair and honest deal
protect confidential information
after listing expires
broker as agent of buyer (offeror)
-can present offers to seller and sellers agent.
-accepting unauthorized deposits
-owes fiducuary duty to buyer only
material facts
-must reveal
-leaky roof
-septic tank-rescind
puffing
exaggerated features or benefits
broker promises seller to find house
civil suit for damages
agent promises to advertise and does not
actual fraud
protect confidential information
after listing expires
deposits
may be anything
seller
deposit belongs to seller
hold deposit check or accept promissory note
must inform seller
conflict between buyer and seller
interpleader
commissions
-communicate acceptance
-if not shared, civil suit
-cancels-owes both
commission after term of listing
protection period clause (safety clause)
liability
damages if acts in excess
fraudulent misprepresentation
discipline, civil, criminal
TYPES OF LISTINGS
- Exclusive Listing
must contain termination date
TYPES OF LISTINGS
-Exclusive Agency
owner sells, no commission
TYPES OF LISTINGS
-Exclusive Right to sell
-pay commission
-no procuring cause
-between seller and broker
(Offers) Terminated by
-withdrawl, gets refund
-death of buyer
-rejection by offeree
-for any reason
Counteroffer
offeree becomes offeror
DEPOSIT RECEIPTS
-Buyer defaults, deposit is
divided between seller and agent
DEPOSIT RECEIPTS
-time is of the essence
on deposit receipt
OPTIONS
-Agreement
not to revoke an offer
OPTIONS
-Contract
to keep an offer open
OPTIONS
-Optionee
not bound to perform
OPTIONS
-Option and Listing
disclose offer, written consent
TAXES
-Marginal Tax Rate
next dollar earned
TAXES
Unadjusted Basis
cost
TAXES
-adjusted basis
not mortgage payment
TAXES
-tax shelter
income taxes
TAXES
-gain
-profit
-$40,000 sale, $8,000 basis = $32,000 gain
PERSONAL RESIDENCE
-Deductions
-property taxes and interest
-$3672
-interest on common area mortgage
PERSONAL RESIDENCE
-Adjusted Basis
concrete patio
INCOME PROPERTY
-Deductions
not for vacancy
INCOME PROPERTY
-Depreciation
-cost of building, not land
-must be improved
Operational Loss
might offset capital gain
Capital Expenditures
added to cost basis and depreciation
loss upon sale
could deduct if rental property
exchanges
debt relief or cash
boot
may have recognized gain
basis of new property
basis of old
sale-leaseback
-deduct 100% of future rent paid
-not sellers book value
installment sale
mortgage relief is down payment
PROPERTY TAXES
-Tax Bills
no legal description
PROPERTY TAXES
-Ad Valorem
acording to value
Property Reassessed
when sold
over-assessed
assessment appeals board
dates
feb 1, april 10
delinquent tax sale
owner remains in possession and can redeem for 5 years
assessment liens
-for local improvements
-cannot purchase land
mello-roos
seller must disclose
transfer tax
-$22
-$138
SUBDIVISION MAP ACT
city or county governing body
master plan
district, street, seismic safety
planning commission
zoning
SUBDIVIDED LANDS ACT
-Condominimums
5 or more units
SUBDIVIDED LANDS ACT
-Sidewalks
common area
types of property
residential, industrial, commercial
estate in real property
condo and apartment
seller provides buyer
by laws, c.c$r's
land project
14 days (cool off)
real estate commissioner
desist and refrain
PUBLIC REPORT
- Given
anyone, anytime
PUBLIC REPORT
- Receipts
keep 3 years
PUBLIC REPORT
- Excessive Price
not included
GENERAL INFO
-building code
higher standards
GENERAL INFO
-Purpose
minimum standard
GENERAL INFO
-Building Permit
local building department
Developer
responsible for street, etc.
Time share gifts
must reveal required attendance
Franchise
marketing plan
Advance Fee for advertising
deposit in trust account and use for advertising
bill of sale
not real property (only for personal property)
Appraiser Theory
-Appraiser
-disclose interest
-date contract was signed
-the given date
-building of no value-deduct demolition
-unacceptable method=felony
-marketability and acceptability
-not assessed value
-strip mall - poses certified general license
narrative report
not buyers financial condition
types of value
statement of purpose
fee appraiser
self employed
appraisal
analysis of fact
stability of value
conformity
market value
-present worth, ability of one commodity
-not cost.
-D - Demand
-U - Utility
-S - Scarcity
-T - Transferability
Principle of contribution
-swimming pool
-effect on net income
highest and best use
-first step for vacant land
-net return
-site analysis
-if temporary, interm use
Principle of substitution
-no prudent person
-use, design, income
-lowest price preferred
principle of regression
bearby substandard property
unearned increment
population
plottage
common ownership of 2 or more units
highest value
maximum utilaztion of resources
appreciation
increases in value over time
Market Data (Comparison) Approach
-Entire property
-substitution
- subtract features from comparable
- vacant lot
- rent schedules
- real estate licensees (use this method)
Difficulty of market data
-adjusting for differences
-rarely similar concerning everything
least reliable
rapid economic change or inactive market
warehouse
rented by square foot
cost replacement approach
special purpose properties
upper limit of value
-set by replacement cost approach
replacement
same utility
new property
works best with new, not old
cost of construction
quantity survey, unit-in place, square foot
1910 House
cost of reproduction
Capitalization Income Approach
converts income into value
Effective Gross Income
deduct for vacancy
Net Income
do not deduct interest
present worth
of future benefits
capitalization rate
-most difficult part to determine
-summation, comparison, band of investment
-post office = lower rate
capitalization (income) approach
used on restaurant
Gross multipliers
-price divided by rent
-$89,700
-$308, 736
depreciation
Less in value from any cause
effective age
15 years old - 6 years
economic life
sufficient income
obsolescence
not wear and tear
functional obsolescence
-not nearby nusances
-one car garage
same building costs, different valuesz
functional obsolescence
Economic Obsolescence
-economic changes
-extraneous
-difficult to cure
-not heating system
-airplanes
-over supply, zoning change
-expensive houses amoung cheaper ones.
-abandoned gas station - toxic waste report
-are tenents prospering?
Obsolescence
Cause, not method
Bearing Wall
remodeling, stronger, any angle
Joist
parallel beam that supports ceiling or floor
Ridge Board
highest spot
Footing
spreading at foundation base
Structural Pest Control Report
-anyone, obtain from pest control board.
-must give buyer as soon as possible
No infestation or damage
buyer pays
best time to get report
before marketing property
deciduous
not type of soil
roof sloping on four sides
hip
higher EER
unit is more efficient
sheet metal
flashing
insulation
interior, adequate
R-Value
resistance to heat
Turn key project
ready for occupancy
elevation sheet
exterior view of building
information booth
kiosk
backfill
excavation
cracked foundation
soil report
plot plan
placement of improvements
foundation plan
footings, peirs, subflooring
substandard building
not wiring
repairs to buildings equipment
corrective maintenance
commercial acre
area devoted to streets, sidewalks and curbs, etc.
orientation
position on site
HVAC
heating, venting air conditioning