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249 Cards in this Set

  • Front
  • Back

A buyer purchases a rental home that is fully furnished. The document used to transfer title to the furniture is?

Bill Of Sale:


Deeds transfter title to real estate; a bill of sale is used to transfer title to personal property.

Of all test to determine if an item is a fixture, the most important test is?

The intention of the party who attatched the item.

A business tenant attatched some personal property items to be leased real estate. These items probably:

Still belong to the tenant, and can be removed when the lease expires.

A tenant farmer has a havest of crops. The landowner sells to a new tenant. Who gets the first crop.

The former tenant. Through the, "Doctrine of Emblements."

A section of land is equivelant to?

One square mile. Under the goverment survey system. Also can be 640 acres.

A survey has been completed and stakes have been placed marking off the property. The survey can be used to?

Construct fences and driveways.

Meridians and base lines relate to the?

Rectangular survey method, also known as the goverment survey system.

Riparian rights

River,stream

Apporative permit

to have access to a body of water

Which is an example of an emblement?

A field of corn.

Unless otherwise stated a property buyer should receive?

Air rights, surface rights, subsurface rights

Property house keys would be?

Real property; because they are adapted to the real property.

Which of the following is NOT a fixture test?

Size of the item.

Best description of boundary lines for a property located in a subdivison would be?

A plat map.

One side of a section in a goverment survey system would be how many feet long?

5,280 feet long.

A real estate agent takes a listing for a mobile home. He may do this if:

If the listing includes the land on which the mobile home sits.

Fee simpe absolute

When a grantee recives title in fee simple, it is assumed to be fee simple absolute (Unconitional)

Qualified Fee Simple

Is a legal interest in land that is subject to one or more limitations.

An estate is possessory; either now or in the future

Fee simple estates

What can a conventional life tenant do?

Sell, lease or mortagure the life estate

A tenant has an automatic renewal clause in his lease/ He probably has:

Periodic estate

A tenancy at will:

Depends on the consent of the property owner

A corporation takes title through

Joint tenancy

The best description of steering?

Showing buyers of a particular raceonly properties in neighborhoods with many residents of that race

When a math problem occurs and theey want you to find the acreage what is the number you divide by to find acreage?

43,560


Think that 4 chipmunks are going 35mph on I60. That will help you visualize.

Who is responsible for earnest money?

The designated broker

A licensee fails to attend a hearing what happens?

The hearing continues without them.

A mortague lien:

is created by contract between the property owner and a lender.

Fair Housing Act prohibits:

discrimination based on race, color, religion, sex, national origin, disability, or familial status, not just race or color.

A developer lists 20 different properties in a subdivision, with four different licensees. Each licensee gets her own model unit to work from. Which of the following is true?

HUD regulations require the display of a Fair Housing poster with the Equal Housing Opportunity logo in any place of business where the business involves the selling or renting of dwellings.

Real Property

Real property is defined as land, anything attached or affixed to the land, and anything incidental or appurtenant to the land.Real property is also called realty or real estate.

Personal Property

Personal property is everything that is not land or permanently attached or appurtenant to land.It is usually movable.Personal property is also called chattels.

Bundle Of Rights

An owner of real property has a bundle of rights, including the right to possess, use, enjoy, encumber, will, sell, or do nothing at all with the property.

Inverted Prymid

Within the boundaries of her property, a real property owner's ownership rights apply to the surface of the earth.Those rights also apply to everything in an imaginary inverted pyramid, with its tip at the center of the earth, and its base in the upper regions of the sky.

Appurtance

An appurtenance is something that goes with or pertains to ownership of a piece of real property, but isn't necessarily a physical part of the property.Air rights, water rights, mineral rights, and support rights are all examples of appurtenances.

Air rights

A real property owner has the right to use the airspace above the property.Air rights are limited by federal aviation law, and may also be affected by zoning and other restrictions.Air rights may be sold separately from the surface property.

Water Rights

Water rights concern the right to use water in connection with real property.Water rights may be governed by the riparian rights system or the prior appropriation system.

Riparian Rights

Under the riparian rights system, a property owner has the right to take water for domestic purposes from a source that touches his land.The water may not be used on a location other than the riparian property.

Littoral Rights

Littoral water is standing water, such as a lake or an ocean, as distinguished from riparian water, such as a river.However, under the riparian rights system, an owner of littoral land has essentially the same water rights as an owner of riparian land.

Prior Appropriation

The prior appropriation system has largely replaced the riparian rights system in Washington.Under the prior appropriation system, someone who wants to take water from a water source must obtain a permit from the state, even if she owns land beside the water source.

Mineral Rights

Solid minerals are part of the real property until they are extracted.A landowner has the right to extract the solid minerals that lie within his property's inverted pyramid.Mineral rights may be sold separately from the land.

Rule Of Capture

Oil and gas rights are governed by the rule of capture.Under this rule, a landowner has the right to any oil or natural gas captured by wells on her property.Like other mineral rights, oil and gas rights may be sold separately from the land.

Support Rights

A landowner has the right to lateral and subjacent support, which is the natural support that his land receives from the land on each side and the land underneath.

Attatchemnets

Things attached or affixed to the land are called attachments, and they are part of the real property unless otherwise agreed.Attachments are classified as natural or man-made.Man-made attachments are called fixtures.

Natural Attatchments

Things attached or affixed to the land are called attachments, and they are part of the real property unless otherwise agreed.Attachments are classified as natural or man-made.Man-made attachments are called fixtures.

Doctrine of Emblements

Under certain circumstances, the doctrine of emblements gives a tenant farmer the right to harvest crops after the lease has expired.

Fixtures

Man-made items of personal property become realty if they are attached to or otherwise closely connected to the land or improvements.Man-made items that have become realty are called fixtures.

Fixture Tests

In the absence of a written agreement between the buyer and seller, four tests are used in deciding whether a disputed item is a fixture.These are the method of attachment test, the adaptation test, the intention test, and the relationship test.

Severance

Some types of appurtenances and attachments to real property may be severed from the land and transformed into personal property.


Legal Description

A property's legal description enables the location and boundaries of the property to be precisely identified.The three main methods of legal description are metes and bounds, government survey, and lot and block.

Metes and bounds method

In a metes and bounds description, monuments, courses, and distances are used to define the property's boundaries.The description must start at and return to a point of beginning.

Goverment survey system

A government survey, or rectangular survey, description identifies the property by its position within a particular section, township, and range.The description must also include the name of the principal meridian.

Lot & Block

Property on subdivided land is identified by its lot and block numbers as shown on the plat map that the developer recorded.Nearly all properties in developed areas can be described with the lot and block method.

Freehold Estate

Freehold estates include fee simple estates and life estates.In contrast to someone with a leasehold estate, someone with a freehold estate has title to the property.The two main categories of freehold estates are fee simple estates and life estates.

Fee Simple

A fee simple estate is the highest and most complete form of real property ownership.It is perpetual, transferable, and inheritable.A fee simple is classified either as a fee simple absolute or as a fee simple qualified.

Fee simple absolute

Fee simple absolute is fee title without conditions or qualifications of any kind.Title is presumed to be conveyed in fee simple absolute unless the grantor makes it clear that she intends otherwise.

Fee simple qualified

A fee simple qualified estate includes all of the same rights of ownership as a fee simple absolute, but it may terminate if a condition or event specified in the deed occurs.At that point, title reverts to the original grantor or his heirs.A fee simple qualified is either a fee simple determinable or a fee simple subject to condition subsequent.

Determinable

A fee simple determinable is one of the two types of qualified fee estates.With a fee simple determinable, title may be forfeited automatically.

condition subsequent

A fee simple subject to a condition subsequent is one of the two types of qualified fee estates.If the condition stated in the deed is not met, title is not forfeited automatically, but the grantor or his heirs may take legal action to regain title.

Life Estate

A life estate is an ownership interest that lasts only as long as a specified person, the measuring life, lives.When that person dies, the property reverts to the reversioners or passes to the remainderman.

Measuring Life

The measuring life is the person upon whose death the life estate will terminate.It's usually the person who owns the life estate, but not always.

Estate in reversion

An estate in reversion is held by the grantor's heirs, who receive the estate after the end of the measuring life.The heirs are known as reversioners.

Estate In Remainder

An estate in remainder is held by a designated third party who receives the estate after the end of the measuring life.The third party is known as a remainderman.

Leasehole Estate

A leasehold estate gives a tenant exclusive possession and use of the property for a limited period.The tenant does not have title.

Estate For Years

An estate for years is a lease for a fixed term, which ends automatically when the term is over.The parties may mutually agree to end the tenancy sooner by surrender.An estate for years is assignable to a third party.

Periodic Estate

A periodic estate is not limited to a specific term, but automatically continues from period to period until one party gives the other proper notice of termination.

Estate At Will

An estate at will has no specific term or rental interval.Rent is not paid on a regular basis, or else it takes some form other than money.A landlord has to give notice to terminate an estate at will.

Estate At Sufferance

An estate at sufferance arises when a tenant who lawfully took possession of the property stays on after the lease ends, without the permission of the landlord.

Severalty

Ownership in severalty is ownership by one individual (either one natural person or one artificial person).

Concurent Ownership

Property is owned concurrently (co-owned) when two or more persons have undivided interests in it.The forms of concurrent ownership recognized in Washington are tenancy in common, joint tenancy, and community property.

Tenancy In Common

In a tenancy in common, the co-tenants' undivided interests may be equal or unequal.There is no right of survivorship, so a tenant in common's interest may be willed.

Joint Tenancy

Joint tenants have equal undivided interests in the property.The key characteristic of a joint tenancy is the right of survivorship.When a joint tenant dies, her interest automatically passes to the surviving joint tenants.

Four Unities

To establish or maintain a joint tenancy, there must be unity of interest, time, title, and possession.

Unity Of Possestion

Both joint tenancy and tenancy in common involve unity of possession.This means that all of the co-tenants have a right to possess the entire property.

Community Property

Community property is a form of co-ownership that exists only between two married people.Everything that a married person owns in Washington is either community property or his or her separate property.Each spouse has a 50% undivided interest in the community property.

Seperate Property

To be classified as a spouse's separate property, property acquired during marriage must be one of the following: (1) acquired by gift or inheritance, (2) purchased with separate funds, or (3) profits or proceeds from separate property.

Joinder

The signatures of both spouses are necessary to list, sell, encumber, or purchase community real property.

General Partnership

In a general partnership, all of the partners have a say in managing the company, and they are personally liable for the partnership's debts.

Partnership Property

If property is acquired in a partnership's name, or if the deed refers to the partnership, then the property is partnership property.Partners may possess the property for partnership purposes.But an individual partner isn't a co-owner of the partnership property, and has no transferable interest in it.

Limited Partnership

A limited partnership has one or more general partners who manage the business and have unlimited liability.It also has limited partners, who may participate in management but usually are passive investors, and who have limited liability.

Limited Liability

Investors who have limited liability are not legally responsible for the debts, the obligations, or the actions of the entity in which they have invested.

Corporation

A corporation is an artificial person that is separate from its stockholders.The stockholders have limited liability.The stockholders elect a board of directors to oversee the business.The board appoints the officers.The officers manage the business.

LLC

In a limited liability company, all of the members have limited liability.Unlike general partners, the managing members of an LLC are not personally liable for the company's debts and obligations.And in contrast to most corporations, LLCs are not subject to double taxation.

Joint Venture

In a joint venture, two or more legal entities join together to accomplish a particular project.A joint venture is not an ongoing business.

REIT

In a real estate investment trust, there are at least one hundred investors, and they have limited liability.To avoid double taxation, the REIT must distribute most of its income to its investors.

Securities

Securities are investment instruments that represent a financial interest in an enterprise without direct managerial control over it, such as shares in a corporation.Securities are subject to regulation by the Securities and Exchange Commission at the federal level and to blue sky laws at the state level.

Condominium

In a condominium, an owner has title to his dwelling unit.But he shares ownership of the condominium's common elements with the other unit owners as tenants in common.For most purposes, including financing and taxation, each unit is treated as a separate property.

Common Elements

The common elements are parts of the condominium property that may be used by all of the residents.Ownership of a specific undivided interest in the common elements is assigned to each unit in the condominium.

Limited Common Elements

Certain features in a condominium, such as assigned parking spaces or balconies, may be designated as limited common elements.Ownership of a limited common element is shared by all of the unit owners.However, the use of a limited common element is reserved for the owner of one unit.

Cooperative

In a cooperative, the units are not separately owned.A corporation has title to the whole property.A tenant owns shares in the corporation and has a proprietary lease for a particular unit.The entire cooperative is taxed and financed as a single property.

Patent

A patent transfers real property from government ownership to private ownership.

Genral Warranty Deed

The covenants in a general warranty deed cover title defects arising before and during the grantor's period of ownership.A general warranty deed offers the grantee the most protection, and gives the grantor the most liability.

Special Warranty Deed

A special warranty deed limits its warranties to the period the grantor owned the property.

After acquired title

Warranty deeds convey after-acquired title.If the grantor did not own the property when the deed was executed, but acquires title later, then title passes to the grantee.

Quitclaim Deed

A quitclaim deed offers no warranties, conveys no after-acquired title, and creates no liability for the grantor.It is typically used to clear away clouds on title.

Habendum Clause

The habendum clause in a deed defines or limits the type of estate that is being transferred to the grantee.If there is no habendum clause, the deed is presumed to convey a fee simple absolute.

Words of conveyance

The words of conveyance state that the grantor is transferring the property to the grantee.The words of conveyance are also called the granting clause.

Will

An owner uses a will to transfer property after her death.In Washington, a will can only transfer real property if it is in writing and signed by the testator in the presence of at least two witnesses.

Devise

A transfer of real property by will is called a devise.A testator devises real property to devisees.

Probate

Probate is the legal procedure for establishing the validity of a will and distributing property according to the terms of the will.

Voluntary Dedication

Voluntary dedication is a gift of private property to the public.

Escheat

If a person dies intestate and the probate court can't locate any heirs, then the intestate person's property passes to the state under the law of escheat.The state may also take ownership of abandoned property through escheat.

Condemtion

Eminent domain is the government's power to take private property for a public use.Condemnation is the legal procedure used to force an unwilling property owner to sell.The government must pay just compensation to the owner.

Suit for parition

In a partition suit, the court divides property owned by two or more people among the co-owners.If the property itself can't be divided, then it will be sold and the sale proceeds will be divided up

Foreclosure

In a foreclosure, a creditor with a lien against property asks the court to have the property sold. The lien will be paid off out of the foreclosure sale proceeds.

AdversePossesion

Under Washington law, an adverse possessor generally acquires title after ten years of possession that has been actual, open and notorious, hostile, exclusive, and continuous.

Avulsion

Avulsion occurs when flowing water or wave action violently tears away land and deposits it elsewhere, or when a sudden change in a watercourse exposes land.Unlike accretion and reliction, avulsion does not necessarily result in involuntary alienation of the land that has been moved or exposed.

Accretion

When waterborne silt is gradually deposited on the shore, it's called accretion.The landowner acquires title to the newly deposited soil.

Recording Procedures

Documents affecting title to real property are recorded in the county where the property is located.Recording procedures are established by state law.

Title Search

Using ownership records maintained by the county clerk, the validity of a seller's title can be established by tracing the chain of title back through the previous owners.

Recorded Documents

Deeds, mortgages, deeds of trust, land contracts, and documents creating or removing encumbrances should always be recorded.Purchase and sale agreements are not recorded.

Lis Pendens

A lis pendens is recorded to provide constructive notice that a lawsuit has been filed that may affect title to specified property.

Constructive Notice

When a person has constructive notice of a fact, he is legally held to know it, even if he does not have actual notice.Recording a deed provides constructive notice of the interest conveyed.Possession of property provides constructive notice of the possessor's interest.

Actual Notice

SummaryThe Recording SystemClick a button below for a summaryRecording proceduresTitle searchActual noticeConstructive noticeRecorded documentsLis pendensA person has actual notice of a fact if she is actually aware of it, whether by direct observation or some other source of information.

Title Insurance Policy

In a title insurance policy, the title company agrees to reimburse the policyholder for losses resulting from title problems covered by the policy.

Owners Policy

An owner's policy provides title insurance coverage for the buyer, the new owner of the property.

Title Report

Based on its title search, the title company issues a title report, listing the defects and encumbrances of record.These will be excluded from coverage when the policy is issued.

Goverment Action

Neither standard nor extended coverage title insurance covers problems resulting from government action, such as zoning changes.

Encumbrance

An encumbrance is a nonpossessory interest in real property, held by someone other than the property owner.It is either a financial burden or a nonfinancial burden on the property owner's title.

Lien

A lien is a financial encumbrance. It is a security interest that gives the lienholder the power to foreclose, forcing the sale of the property so that the debt can be paid.A lien is either voluntary or involuntary, and either specific or general.

Mortague

A mortgage is a voluntary, specific lien.It is created by contract between the property owner and a lender when the property is offered as security for a loan.

Deed Of Trust

Like a mortgage, a deed of trust is a voluntary, specific lien that makes the property security for a loan.The key difference between a mortgage and a deed of trust concerns the method of foreclosure.

Judgement Lien

A judgment lien is an involuntary, general lien held by someone who was awarded a judgment in a lawsuit.It attaches to all of the judgment debtor's property in the county where the judgment was entered, or where an abstract of judgment is recorded.

Tax Lien

Taxation results in various types of involuntary liens. Property tax liens and special assessment liens are specific liens against the taxed property.IRS liens are general liens against all of the delinquent taxpayer's property.

Lien Priority

The rules of lien priority determine how the proceeds of a foreclosure sale will be applied if they are insufficient to pay off all the liens against the property.The lien priority of mortgages and deeds of trust is generally established by recording date. 'First in time is first in right.'

Tax Liens

Property tax liens and special assessment liens are exceptions to the 'First in time' rule. They are superior to all other liens.

Easement Appurtenant

An easement appurtenant burdens one property for the benefit of another.It's appurtenant to, and increases the value of, the benefited property.

Running With The Land

An easement appurtenant runs with the land.This means that its burden and its benefit are passed along to the subsequent owners of the servient and dominant properties.

Easement In Gross

An easement in gross benefits only a person, not a parcel of property.As a general rule, an easement in gross is not assignable, and it is extinguished when the easement holder dies.

Commercial easement in gross

A commercial easement in gross is one that is granted to a utility or other business for business purposes.Unlike a personal easement in gross, a commercial easement in gross typically is assignable.

Implication

An easement by implication arises when part of a larger property is sold and the seller fails to grant or reserve an express easement.The easement by implication must be reasonably necessary, and there must have been apparent prior use at the time of sale.

Condemnation

An easement by implication arises when part of a larger property is sold and the seller fails to grant or reserve an express easement.The easement by implication must be reasonably necessary, and there must have been apparent prior use at the time of sale.

Dedication

An easement is created by dedication if a private owner donates easement rights to the government. Long-term public use can result in implied dedication, and the government won't be required to compensate the private owner.

Abandoment

If the dominant tenant engages in actions that indicate an intention to stop using the easement forever, the easement may terminate by abandonment.

Encroachment

An encroachment occurs when something that is a part of one parcel of real property intrudes onto the neighboring parcel.The neighbor can sue to have the encroachment removed.

Nuisance

A nuisance is a use of property that is offensive or annoying to neighboring landowners or to the community.

CC&Rs

Most subdivisions have a declaration of restrictions imposed by the original developer.These subdivision restrictions are also called CC&Rs, which stands for covenants, conditions, and restrictions.The CC&Rs may be enforced by a homeowners association, or else by homeowners within the subdivision.

Covenants

Private restrictions are ordinarily interpreted as covenants, which are contractual promises.If a property owner violates a covenant, a judge may issue a court order directing the owner to stop the violation or pay money damages, or both.But title to the property can't be forfeited.

Variance

A variance is permission from the local zoning authority to use property or build a structure in a way that violates the strict terms of the zoning ordinance.

Rezone

A rezone is an amendment to a zoning ordinance, usually changing the uses allowed in a particular zone. It is also called a zoning amendment.

Police Power

The police power is the power of state and local governments to enact and enforce laws for the protection of the public's health, safety, morals, and general welfare.

Nonconforming Use

A nonconforming use is a property use that does not conform to current zoning requirements.The use is allowed to continue because it was already in place before the present zoning ordinance was enacted.

Building Codes

Building codes are state and local regulations that set minimum standards for construction methods and materials.

Building Permits

Building codes are enforced through the building permit system.A property owner must submit plans and obtain a permit from the city or county before constructing a new building or repairing, improving, or altering an existing building.

Certificate Of Occupancy

Once a completed building has been inspected and found satisfactory, a certificate of occupancy is issued.

ILSA

The Interstate Land Sales Full Disclosure Act is a federal consumer protection law that applies to subdivisions offered for sale or lease in interstate commerce.

Ad Valorem Tax

General property taxes are based on the value of the property.The more valuable the property, the higher the taxes.

Special Assessment

A special assessment is a tax levied only against the properties that have benefited from a public improvement, such as sewers or streetlights.The assessment is intended to cover the cost of the improvement.

Tax Exemptions

All real property in Washington is taxed unless it is exempt.Exemptions include publicly owned property, property used for religious purposes, and property owned by some nonprofit organizations.

Excise Tax

An excise tax is levied on each sale of real property in Washington.The tax is based on the property's selling price.

Express or Implied

An express contract is one that is put into words, either spoken or written.An implied contract is one that is not put into words, but implied by the actions of the parties.

Unilateral or Bilateral

In a unilateral contract, only one of the parties is legally obligated to perform.If a contract is bilateral, both parties are legally obligated to perform.

Mental Compentance

A contract signed by someone who has been declared incompetent by a court is void, so that neither party can enforce it.

Guardian

A legal guardian can enter into a binding contract on behalf of a minor or an incompetent person.

Void

A contract is void if there was a mentally incompetent party, an unlawful objective, a forged signature, or no consideration.A void contract has no legal effect.Both parties can disregard it.

Voidable

A contract is voidable if signed by a minor, or if signed as a result of fraud or other negative factors.If a contract is voidable by one party, it is unenforceable by the other party.

Valid

A contract is valid if it meets all legal requirements.It is binding and enforceable in a court of law.

Rescisson

When the parties agree to rescind their contract, each returns anything the other had already given in performance of the contract.

Novation

In a novation, a new party takes the place of one of the original parties, and the withdrawing party is released from liability.Substitution of a new agreement for an old agreement between the same parties is also referred to as novation.

Liquidated Damages

Liquidated damages is money one party agrees in advance to accept as her remedy if the other party breaches.An earnest money deposit is often treated as liquidated damages.

Listing Agreement

A listing agreement is an employment contract between a seller and a firm.The firm is hired to find a buyer for the property, and the seller agrees to pay a commission under specified conditions.

Land Contract

A land contract is a financing agreement between a buyer and a seller.The seller agrees to accept payment for the property in installments.The seller transfers legal title only when the buyer makes the final contract payment.

Option

An option to purchase gives the optionee the right to buy the property for a specified price during the option period, without creating any obligation to do so.If the optionee exercises the option before it expires, the optionor is required to convey the property on the agreed terms.An option agreement must be in writing and may be recorded.

Escrow Instructions

Escrow instructions are a buyer and seller's instructions to their escrow agent.The instructions set forth the conditions that each party must fulfill in order for the transaction to close.

Vicarious Liability

Under general agency law, a principal may be held liable for torts committed by his agent.This is called vicarious liability.Under Washington's real estate agency statute, vicarious liability has been severely restricted in real estate transactions.

Termination By Parties

Under general agency law, an agency relationship may be terminated by mutual consent, or the principal may revoke the agency, or the agent may renounce the agency.Unilateral termination may be a breach of contract.

Seller Agency

A seller agency relationship is ordinarily created with a written listing agreement.The listing brokerage is the seller's agent, and the named affiliated licensee is the seller's subagent

Working With Buyers

A seller's agent may prepare an offer to purchase for a buyer and help the buyer apply for financing, without violating his duty of loyalty to the seller.

Dual Agnecy

A dual agent represents both the seller and the buyer in the same transaction.The agent must do nothing that would harm the interests of either party, and may not reveal either one's confidential information to the other.

Agency Disclosure

Before a party signs an offer to purchase, a licensee must disclose to that party which party the licensee is representing.The disclosure must be in writing and signed by the party to whom it is made.

Non Agency

A licensee may choose to act as a non-agent in a transaction, owing no special agency duties to either party.The licensee's general duties to any party still apply.

Ready Willing and Able Buyer

A seller is generally required to pay the listing brokerage a commission only if a ready, willing, and able buyer is found during the listing period.A ready, willing, and able buyer is one who makes an offer that meets the seller's stated terms and who has the financial ability to complete the purchase.

Compensation

To be legally entitled to a commission, a listing brokerage must meet three requirements:the firm must have had a written listing agreement with the seller,the firm and its agents must have been licensed before services were offered or a promise of compensation was procured, andthe requirements of the agreement must have been fulfilled.

Open Listing

A seller can give an open listing to more than one brokerage at the same time.Only the firm that is the procuring cause of the sale will be entitled to a commission.

Exclusive Listing

An exclusive agency listing or an exclusive right to sell listing can only be given to one firm at a time.To claim a commission under an exclusive listing, the firm may be required to show that it exercised due diligence in trying to find a buyer for the property.

Exclusive Agency

Under an exclusive agency listing, the seller must pay the brokerage's commission if anyone other than the seller finds a buyer during the listing period.

Exclusive Right To Sell

Under an exclusive right to sell listing, the brokerage gets the commission if the property sells during the listing period.This is true no matter who found the buyer, even if it was the seller.

Net Lisitng

A net listing is a listing agreement in which the seller sets a net amount she is willing to accept for the property.If the sales price is more than that set amount, the brokerage is entitled to keep the excess.

Commision Rate

The commission rate cannot be pre-printed on the listing agreement form, because it must be negotiable for each transaction.

Disstressed Home Conveyance

A conveyance in which a buyer purchases property from a distressed homeowner (that is, one facing foreclosure), and allows the homeowner to occupy the property for more than 20 days past closing, and/or promises to convey the property back or convey an interest of the proceeds.The Washington Distressed Property Law strictly regulates these transactions.

Counteroffer

A seller's counteroffer may be written up as a modification to the purchase and sale agreement form.The counteroffer becomes a new offer, and there is no contract unless the buyer signs the counteroffer.

Earnest Money

The purchase and sale agreement will have a place to indicate the amount of the buyer's earnest money deposit, what form the deposit takes, and how the deposit will be held while the transaction is pending.

Bump Clause

A bump clause provides that the seller can keep the property on the market pending fulfillment of a condition.The seller can accept another offer, and terminate the first agreement if the buyer doesn't waive the condition on demand.

Promise Note

A promissory note is a written promise to repay a debt.The parties are the maker and the payee.A promissory note is typically a negotiable instrument, which means that the payee can endorse it over to a third party.

Acceleration Clause

An acceleration clause allows the lender to demand immediate payment of the entire debt if the borrower defaults on any part of the loan agreement.

Alienation Clause

An alienation clause gives the lender the right to demand immediate payment in full if the borrower sells the property or otherwise alienates an interest in it without the lender's approval.

Subordination Clause

A subordination clause is a provision in a mortgage that allows a subsequent mortgage to take a higher lien priority.

Short Sale

A short sale is another alternative to a foreclosure proceeding. A short sale requires all lienholders to consent to the sale of the house for a price that is something "short" of (less than) the amount owed, due to a decline in market value.

Blanket Mortague

A blanket mortgage uses several pieces of property to secure one loan.This arrangement is most commonly used by developers, since it allows individual lots to be released from the mortgage as the loan is repaid.

Wraparound Mortague

A wraparound mortgage secures a loan made by a property seller to a buyer. The buyer takes title subject to the seller's existing mortgage, but does not assume it. The seller uses part of the buyer's payments on the wraparound loan to make the payments on the existing loan.

Package Mortague

A package mortgage finances the purchase of personal property together with real property, all with one loan.

Budget Mortague

With a budget mortgage, prorated shares of the property taxes and insurance premiums are added to the monthly mortgage payment.

Construction Loan

A construction loan is a temporary loan to finance construction on the borrower's property.The loan funds are released to the borrower as construction progresses, often according to a fixed disbursement plan.When construction is complete, the construction financing is replaced with permanent financing.

Open-End Mortague

An open-end mortgage allows a borrower who has paid off part of the loan to re-borrow some of the money.

Swing Loan

A swing loan can be used to provide funds for the purchase of a new home, when the sale of the buyer's current home hasn't yet closed.

Reverse Equity Loan

A reverse equity mortgage enables an elderly homeowner to draw on his equity for additional income, without having to sell the home.The property usually must be sold to repay the debt when the borrower dies.

Discount Points

Discount points are paid to the lender at closing in exchange for a lower interest rate.One point is 1% of the loan amount.Discount points are sometimes paid by the seller, to help the buyer qualify for the loan.

Truth In Lending

The Truth in Lending Act is a federal law that helps borrowers compare loan costs. It applies to consumer loans.Loans made for business, commercial, or agricultural purposes are exempt.The act requires lenders to give loan applicants a disclosure statement, and it also places restrictions on consumer loan advertising.

APR

The Truth in Lending Act requires lenders to calculate and disclose the loan's annual percentage rate.The APR is the complete cost of the loan stated as an annual percentage.

Orgintation Fee

A loan origination fee is used to cover the lender's administrative expenses.It is often stated as a percentage of the loan amount.The fee is paid at closing, ordinarily by the buyer.

Preapproval

If a home buyer is approved for a loan by a lender, before finding a particular property, it's called preapproval.As long as the buyer chooses a home that's under the lender's price limit and meets the lender's standards, the loan will usually be approved.

Networth

A loan applicant's net worth is determined by subtracting her debts and other liabilities from her assets.The applicant must have enough money to cover the cost of the purchase and still have reserves left over.

Subprime Lending

Subprime lending refers to making riskier loans than prime lenders are willing to make. Subprime loans usually have higher interest rates and fees to cover the added risk to the lender.

Loan Application

The loan application for residential mortgage loans requires applicants to supply information about their finances, including housing expenses, employment, income, and assets and liabilities.

Amortization

With an amortized loan, part of each payment is applied to reduce the principal balance, and the rest is interest.Most institutional loans are fully amortized, so that the regular payments are sufficient to pay off the entire debt by the end of the loan term.

LTV

A loan-to-value ratio expresses the relationship between the loan amount and the property's appraised value or sales price (whichever is less).A loan with a low loan-to-value ratio represents less risk for the lender than a high loan-to-value ratio loan.

Loan Term

The loan term or repayment period is the length of time allowed to the borrower in which to repay the loan.The standard term for home loans is 30 years.

FHA

The Federal Housing Administration, or FHA, is a federal agency that insures mortgage loans made by institutional lenders.The FHA loan program is intended to benefit low- and middle-income home buyers.

FHA Qualifying Standards

The FHA allows a borrower to have higher income ratios than conventional lenders permit.Along with other less stringent qualifying rules and the low downpayment requirements, that makes it easier to qualify for an FHA loan than a conventional loan.

VA

VA-guaranteed home purchase loans are available to eligible veterans of the armed forces.The loans are guaranteed by the federal government, so that if the borrower defaults, the VA will reimburse the lender for its losses.

VA Eligibility

To be eligible for a VA loan, a veteran must have served at least a minimum amount of time on active duty.The amount of active duty required is less for service during wartime.An eligible veteran is issued a Certificate of Eligibility by the VA.

Appraisal

An appraisal is an estimate or opinion of a property's value.

General Data

General data is information concerning matters outside the subject property that have an impact on its value, such as the economic situation in the community.An appraiser performs a neighborhood analysis to evaluate how the neighborhood affects the subject property's value.

Specific Datat

Specific data is information about the subject property itself.The appraiser gathers specific data in a site analysis and a building analysis.

Sales Comparison Approach

The sales comparison approach relies on the recent sales prices of comparable properties to estimate the market value of a property.It is also called the market data approach because it uses information gathered about recent transactions in the local real estate market.

Arms Length Transaction

A transaction in which the buyer and the seller are unrelated by close personal, family, or business ties, making it more likely that the purchase price reflects the true market value of the property.Unrelated parties are one component of normal market conditions.

Cost Approach

Using the cost approach, the appraiser estimates the replacement cost of the building, deducts depreciation, and adds the value of the site.

External Obsolescence

External obsolescence is also called economic obsolescence.It is depreciation caused by forces outside the property, such as neighborhood decline or proximity to a nuisance. External obsolescence is always incurable.

Functional Obsolesecence

Functional obsolescence is depreciation caused by functional inadequacies or outmoded design.Functional obsolescence may be curable or incurable.

Escrow

Escrow is an arrangement in which money and documents are held by a third party on behalf of both buyer and seller.

Escrow Agent

An escrow agent is a third party who holds money and documents in trust and carries out the closing process.

Settlement Statement

During closing, the escrow officer prepares a statement that sets forth all the financial aspects of a real estate transaction in detail.The statement also indicates how much cash each party will be required to pay or will receive at closing.

Debit

A debit is an amount payable by a party.

Credit

A credit is an amount payable to a party.

Reserve Account

A reserve account contains funds on deposit with a lender to pay property taxes and insurance premiums when due.

Proate

An escrow agent will divide and allocate an expense proportionately, according to time, interest, or benefit, to determine what share of it a particular party is responsible for.This process is called prorating an expense.

Balance due from buyer

The balance due from the buyer is the amount of cash the buyer has to bring to closing.That figure is calculated by adding up the buyer's credits, adding up the buyer's debits, and then subtracting the buyer's total credits from the buyer's total debits.

Balance due to seller

The balance due to the seller is the amount of cash the seller will take away from the transaction at closing.That figure is calculated by adding up the seller's credits, adding up the seller's debits, and then subtracting the seller's total debits from the seller's total credits.

FIRPTA

The Foreign Investment in Real Property Tax Act is a federal law, the purpose of which is to prevent foreign investors from evading their U.S. tax liability.

RESPA

The Real Estate Settlement Procedures Act is a federal law that requires lenders and closing agents to disclose information about closing costs to homebuyers.

Initial Basis

The initial basis is the amount of the taxpayer's original investment in the property.In other words, it's how much it cost to acquire the property.

Adjusted Basis

A taxpayer's adjusted basis in a property equals the initial basis plus capital expenditures, less any depreciation or cost recovery deductions.

Capitol Expenditures

A capital expenditure is money spent on property improvements that add to the property's value or prolong its economic life.

Blockbusting

It's called blockbusting when a real estate agent induces homeowners to sell or list their homes by predicting that members of another race or ethnic group, or people suffering from some disability, will be moving into the neighborhood.Blockbusting is illegal.

Redlining

It is redlining for a lender to refuse to make a loan because of the racial or ethnic composition of the neighborhood in which the property is located.Redlining is illegal.

Rent Roll

A rent roll is a report on rent collections, in the form of a list of the total amount of rent earned, both collected and uncollected.

Sublease

When a tenant transfers only part of his leasehold estate to another, it's a sublease.

Writ

A writ of possession is a court order that orders a defaulting tenant to move out of a property.

Tyoes Of Leases

There are five major types of leases: fixed leases, graduated leases, net leases, percentage leases, and ground leases.

Broker

An individual licensed as a broker may provide real estate services only under the supervision of the firm's designated broker or another managing broker.A broker with less than two years of experience is subject to a heightened level of supervision

Renewal

A real estate license must be renewed every two years.To renew, a licensee must submit proof that she has completed 30 hours of approved real estate courses.A broker renewing her license for the first time must complete 60 additional hours of prescribed coursework.

Cancelation

If a license hasn't been renewed within one year after it expired, it is canceled.Once the license has been canceled, if the former licensee wants to engage in real estate activities again, she will have to apply to have the license reinstated.

Inactive License

An inactive license is one that is in the possession of the Director of the Department of Licensing. An inactive licensee may not perform any activities that require licensure.

Dual Agency

If the seller's agent and the buyer's agent in the same transaction are affiliated with the same brokerage firm, that brokerage firm is a dual agent.Dual agency is unlawful without the written consent of both parties.

Trust Account

A trust account is a specially designated bank account in a brokerage firm's name, for depositing funds that the firm is holding on behalf of its clients or customers.The purpose of a trust account is to keep trust funds segregated from other money, such as the brokerage firm's general business funds.

Commingling

Commingling refers to illegally mixing trust funds together with other funds (such as a licensee's own money, or money in the firm's general business account).

Price Fixing

Price fixing is the cooperative setting of prices by competing firms, in violation of antitrust laws.In the real estate context, examples include agreements between competing brokerage firms to set commission rates, and the establishment of uniform commission rates by a multiple listing service. Both of these would be illegal price fixing.

Group Boycott

A group boycott is an agreement between two or more competing businesses to exclude another business from fair participation in the market.Antitrust laws prohibit group boycotts.

Tie-In Arrangemnet

A tie-in arrangement is an agreement to sell one product only on the condition that the buyer also purchases a different product.Tie-in arrangements violate antitrust laws.