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189 Cards in this Set
- Front
- Back
4 powers the gov't has over us regarding our land
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P-police power
E-eminent domain T-taxation E-eschet |
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deals with zoning laws, health and safety
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Police power
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sue the governement for land taxation that is really high, so much so that you cannot affor the land or it is unusable
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Inverse condemnation
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formula for CA porperty taxes
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Assess value of property X tax rate = TAX
AV X TR = T |
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Types of zoning
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R1, R2, R3, A, M
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chaning the use of alot of tracts or real estate as is relates to the master plan
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rezoning
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chaning the use of 1 parcel of land. ie mom and pop shop in residential neighborhood
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spot zoning
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going from commercial to residential and vice versa
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downzoning and upzoning
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says you can do something different with your land than what it's zoned for but it can' be permanent. ie a daycare in a residential area
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conditional use
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says that if the gov't changes the zoining, you can keep doing what you were doing before it changed
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Preexisting Nonconformity
aka legal nonconformity or nonconforming use |
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lets you do someting other than what the area was zoned for, usually a hardship is required. ie build closer to the back fence b/c your lot is smaller than the others.
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variance
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these setminimum standards but not max. standards.
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building codes
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who enforces the building code
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building inspector
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using a product different from what is required but equally as safe and functional
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exception
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states that in CA, 1 to4 unit buildings don't have caveat emptor, seller is obligated to disclose any defects they're aware of
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Disclosure law
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it chips and was banned for use after 1978
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lead based paint
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ordorless, colorless, exists in nature, slightly heavier than air, can sink into the basement and build up
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Radon Gas
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machine used to detect radon gas
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Alpha Tract Detector or
Eclectret Ion Chamber Detector |
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could be in the insulation or the linoleum glue
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aesbestos
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this type of insulation contained aesbestos
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urea foam insulation
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says that if contamination is found on th eproperty, the now or prior owners or posessors of the land (tenant) is responsible for the cleanup
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superfund law
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states that a subdivision is 20 or more parcels and gives local gov't control over physical aspects of the land, ie size and shape
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subdivision map act
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states that 5 or more parcels, the state gov't has control over physical aspects of the land, deals with financial aspects
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subdivided lands law
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state says most of the parcels can be used for what they're intended. with this, developer can accept deposit money but not enter into contract. money is put in escrow with a refund option if they change their mind.
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preliminary public report
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allows developer to enter into a purchase agreement but can't complete contract and close escrow untl final PR
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condtional Preliminary Report
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states you can now close
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Final Preliminary Report
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statement showing what the porposed project will do to the area
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environmental impact rpeort
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preort stating that hte development won't have a negative impact on environment
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negative declaration
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one of the two of these is needed for every project
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environmental impact rpeort
negative declaration |
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with regard to water rights, anything that doesn't disturb the use
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Reasonable use
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these rights pertain to land that adjoins rivers and streams
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Riparean Rights
(r=river and riparean) |
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these rights pertain to land that adjoins the seashore or lake
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Litoral rights
(l=lake and litoral) |
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the buildup of land from erosion
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Accretion
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the sudden tearing away of land, usually from water
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evulsion
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an agreement between two or more people to do or not do a certain thing, the breach of which the law provides a remedy, and the performance of which the law imposes a duty.
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contract
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a contract the contains all of the 4 elements required by law
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valid
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a contract that has missing any of the 4 elements required by law
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void
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a contract that looks good at start but may not be
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voidable
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this contract is enforcable in court
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valid, unless it has gone beyond the statute of limitations
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4 elements of a valid contract
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CO-consent
CA-capacity CO-consideration LA-Lawful object coca cola |
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ist step in any contract, an invitation to enter into a contract
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offer
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giver in a contract
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offeror
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recipiant in a contract
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offeree
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only 2 things an offeree can do with a contract
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accept or reject
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once an offer has been rejected, can it be brought back?
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no, a counteroffer is considered a rejection of the first offer.thus making the offeree now the offeror
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an offer can only be rejected by the
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offeree
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an offer can only be rescinded by the
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offeror
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3 ways to kill an offer
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time lapses
rejection either party dies (this terminates an offer but NOT a contract) |
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when is a contract officially formed?
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upon COMMUNICATION of acceptance of the offer
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who is considered "master of the offer"?
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the offeror, they can set the rules of the contract
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states that if the manner of acceptance hasn't been stated, the minute the offer goes in the mail, it becomes a contract, even if the offeror dies before it gets there
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mailbox rule
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offer and acceptance is the process, mutual consent is the result
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consent
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legal ability of a person to perform certain civil acts
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capacity
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ways to become an emancipated minor
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lawfully married or unmarried
court order active duty |
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anything of value that induces or intices you to enter into the contract; the promise given for a promise in a bilateral contract
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consideration
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something that the law will stand by
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lawful object
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this is a promise for an act, binding when the act is performed and accepted by performance
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unilateral contract
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this is a promise for a promise, binding at the time of agreement and accepted by promise
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bilateral contract
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what type of contract is a real estate purchase agreement?
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bilateral b/c it's the promise to pay money in exchange for the promise of a house
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stated in oral or written words
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express
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stated in the actions of the party
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implied (doesn't exist in real estate)
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any contract that has been completely or fully performed; also means the date it was signed
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executed
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a contract sill in process but not yet been performed
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executory agreement
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transfer of a right to another party
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assignment
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2 ways to change a contract
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change the parties
change the terms |
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what is it called when a change is made to a contract?
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modification or ammendment; written contract needs written modification, aka an addendum
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completely new contract (vs addendum)
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novation
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amount of tim you have to persue a lawsuit;
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statute of limitations
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how long is the statute of limitations?
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written-4 years
oral-2 years ownership of RE-5 years judgements-10 years w/ option to extend |
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this requires that certain contracts be in writing in order to be enforceable
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statute of frauds
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5 types of contracts that must be in writing
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-Real Estate
-Property rental for 1 year -any contract that can't be performed w/in 1 year -assuming of anothers debt |
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the sellers consideration as the promise to deliver clear title, the buyers consideration as the promise to deliver funds at escrow and obtain financing
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deposit reciept (a standard RE contract)
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3 steps in the depoist reciept
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1. offer
2. receipt for earnest money deposit 3. binding RE agreement upon communication of acceptance of offer |
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if a husband and wife have community property? how many parties have to be present to list the property? to sell the property?
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1 to list, 2 to sell
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state that if something happens to the property during the course of the transaction, the butyer may cancel the transaction or require the necessary fixes to be made, as long as neither title or posession have been transferred
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uniform vendor and purchaser rist act
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something you must do for the contract to keep on going
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condition
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something that must occur in or dor the contract to happen (largest is financing)
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contingency
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states that all parties must complete the deal in the necessary time frame, otherwise it could be considered breach of contract
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time is of the essence clause
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a unilateral contract to keep open an offer
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option, found at the end of leases
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if an option is combined with a listing, who becomes the principal?
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the broker
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this is considered a mortgage substitute
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land contract
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these are the benefits of owning real estate, ie the right to use and enjoy the land
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equitable title
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the ability to control the real estate, ie sell, lease, will
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legal title
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in a mortgage, equitalble and legal title are retained by...
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the seller
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in a land contract, the equitable tite goes to...
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the vendee (buyer)
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in a land contract, the legal title goes to
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the vendor (seller)
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states that if something happens to the property, the buyer is responsible
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uniform vendor and purchaser land act
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if asked how to describe a premesis, answer with
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an adequate description
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this creates a relationship between a landlord and an tenant
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lease
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another name for landlord
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lessor
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another name for tenant
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lessee
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a lessee becomes a.....in a transfer of rights
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assignor
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landlord pays the expenses, tenant pays the rent
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gross lease
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fixed amount of rent and the tenant will pay ap portion of the landlors expences (maintenance, taxes, insurance)
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net lease, triple net lease
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type of lease where the base and overage are based on the tenants gross repeipts; only in retail
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percentage lease
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type of lease where the rent increases are built into the lease
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graduated lease aka
step up lease |
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financing arrangement where you sell it and lease it back
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sale lease back
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both parties voluntarily end a lease contract
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mutual recission
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1 side defaults, the other is entitle to a remedy
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breach of contract
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in a suit, buyers demand.....while sellers ask for .......
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equitable remedy-specifi performance
legal remedy-damages |
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a lawsuit to force a seller to continue with sale
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specific performance
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an agreed upon amount that will be given if the contract falls through
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liquidated damages
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a loan is only a loan if there is a...
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promise to pay back, otherwise it's a gift.
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a loan is what type of contract?
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unilateral, a promise for an act
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something that is = or greater than the $ amount
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collateral
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transfer posession of the collateral to the lender
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pledge/pawn
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this is evidence of the debt
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note/promisory note
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on a note, the borrower is the...and the lender is the...
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maker
payee (the person to which the note is made payable) |
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is the note money?
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no, it is accepted in general society a money in lieu of cash, similar to a check
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transfer a right to another (give them the note)
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endorsement (as opposed to assignment which is used in contracts)
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the new holder of a note
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holder in course (payee remains payee)
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can you foreclose on a note?
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no, only on a mortgage
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this is evidence of the debt
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note
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this is a security device
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mortgage
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in a mortage, the lender is the ....
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mortgagEE
vs. the borrower who is the mortgagOR because he has given the lender the right to take the property |
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the 5 promises on a note
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1. pay the note
2. pay the taxes 3. pay insurance 4. don't commit waste 5. don't use the property for illegal activity or purposes |
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if you can't meet a promise on a note, you are considered to be
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in default (as opposed to breach)
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the lien that is created against the property in a mortgage
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specific lien
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this is issued by the mortgagee when all payments have been satisfied
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satisfaction of mortgage
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this is used to get property back in default
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judicial foreclosrue
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paying the debt plus any back taxes, etc. Can take up to one year and the mortgagor gets to stay in posession for that year
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redemption period
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equitable mortgage
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no answer
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power to sell the property in a 3rd party situation
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bare legal title
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trustee give bare legal title to trustor using a trust deed or deed of trust
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living trust
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if a living trust is paid off, the bare legal title reconveys back to the trustor using a
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reconvenyance deed
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sale of a default property by the trustee
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trustees sale
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know timeline for trustees sale
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see notes
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issued to lender for amount of loan
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trustees deed (nonjudicial foreclosure)
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judicial foreclosure, trustees sale, way to get the deed back.
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Deficiency judgement
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the two times you can't get a deficiency judgement
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1. owner occupied 1-4 unit purchase money loan
2. seller carried financing |
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parties on a note
parties on a mortgage parties on a deed of trust |
2
3 3 |
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borrower of deed of trust
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trustor
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borrower on mortgage
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mortgagor
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lendor on deed of trust
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meneficiary
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neutral 3rd party on deed of trust
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trustee
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know that summary of security devices
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in notes
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directionally, how does the note travel?
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maker to payee
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how does the mortgage travel?
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mortgagor to mortgagee
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how does the deed of trust travel?
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trustor to trustee
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how does the land contract travel?
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vendor to vendee
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in CA, someone who deals in deeds of trust
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mortgage broker b/c a mgt can be a deed of trust (ie kleenex or tissue analogy)
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2 types of loans
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straight note
amortized loan |
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loan where the principal is paid at the end
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straight note
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3 types of straight notes
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1. no interest
2. interest only 3, interest at maturity |
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loan where part of principal is paid every month
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amortized loan
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loan is paid in equal installments every month
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fully amortized loan
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somewhere before the length of the term, the lender will ask for the entire principal
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partially amortized loan
aka balloon payment |
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loan where the amount increases
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graduated payment loan (can be fixed or variable) negative amortization
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loan where the interest rate changes based on an index
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adjustable rate mortgage (arm)
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loan where the lender makes payments to the borrower
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reverse annuity mortgage
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commercial mortgage where the lender takes an ownership interest in exchange for a lower interest for the borrower
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shared appreciation mtg.
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mortgage where real and personal property are secured by the same loan (not popular)
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Package Mtg.
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mortgage where more than one property is covered by one mtg.
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blanket mtg (still a specific lien)
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this clause is used to sell different properties at different times in a blanket mtg.
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partial release clause
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mortgage where you can obtain more funds without a new contract (ie credit line)
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Open-ended mortgage
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3 types of governement loans, these are conforming loans
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va
fha cal vet |
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these loans conform to freddie and fannie guides
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conforming loans
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if a loan is not a gov't loan, it is a...
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conventional loan
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know wraparound mtg
aka AITD |
see notes
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what type of financing is construction financing?
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interim financing
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this loan changes from a construction loan to a long term loan
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take out loan
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how do you calculate the loan to value ratio?
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Loan amount/property value
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the difference between property worth and any liens against it
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equity
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fee for processing the loan
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origination fee
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% of the fee in points
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discount fee
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how do you calculate discount fees?
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formula is 1:8
1pt up front will reduce your interest rate1/8%, 2pt reduces 1/4% 4pt reduces 1/2% |
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this clause allows a loan to come later but be treated as if it came earlier
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subordintion clause (ie smud on our refi)
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clause that states you can't pay off a loan early
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lock in clause
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states you can pay early at a premium
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prepayment penalty
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clause that speeds up the due date to be payable now
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acceleration clause
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clause that states you musht pay off a loan rather than transfer the loan to someone else
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due on sale clause
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3 characteristic of money
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1. medium of exchange
2. store of value 3. unit of measurement |
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this is money that has been invested
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capital
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the price of capital is
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interest
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if a commodity is scarce, the prices...
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increase
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if a commodity is abundant, the prices
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decrease
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4 sources of capital
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1. commercial banks
2. Savings and loans 3. life insurance companies 4. mortgage brokers (not mtg banker) |
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who make the most loans?
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commercial banks
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who make loans on 1-4 family properties
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S & L's
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who usually do construction loans and large transactions?
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Life insurance co.
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who lend's other peoples money?
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mtg broker
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who lends thier own money
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mtg banker
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where do mtg bankers get their consumer lending license?
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Dept. of Corps.
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5 things that the FHA does
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1. 30 year amortized loans
2. mtg insurance to protect against deficiency judgement 3 lower interest rates 4 uses mmi to develop underwriting 5. uses mmi to minimize property requirements |
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what is MMI?
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mutual mortgage insurance, used by fha
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characteristics of a VA loan
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free
possible to do with no $ down need a cert of eligibility and cert of reasonable value |
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these two loans require impound accounts
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VA & FHA
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set up where you have to pay taxes and insurance w/ your mtg.
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impoud account
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characteristics of CAL VET loan
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funds using land contract
state hold title pays off home in event of death of the veteran AWESOME DEAL |