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99 Cards in this Set
- Front
- Back
- 3rd side (hint)
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Fiduciary Duties C.O.L.D.A.C. |
Care Obedience Loyalty Disclosure Accountability Confidentiality |
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Steering |
Showing only properties in areas you feel is dominated by their ethnicity. |
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Blockbusting |
Create panic selling by inducing owners to sell before the neighborhood changes or homes lose value. |
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Redlining |
A lender refuses to lend in a certain area because it is populates with a member of a certain class. |
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Civil Rights Act 1866 "Reconstruction Act" |
All persons born in the US despite RACE & COLOR have the right to enter into contracts, sue, inherit, aquire & dispose of property. |
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Fair Housing Act 1968 Amended 1988 |
Race 1866 Color 1866 Religion 1968 National Origin 1968 Gender 1974 Family Status 1988 Disability 1988 |
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Equal Credit Opportunity Act (ECOA) |
Prohibits Creditors from discriminating against Race Color Religion National Origin Sex Marital Status Age Receives income from public assistance |
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Americans w/ Disabilities Act (ADA) |
● Physical Workplace Accommodatio ●Handicap Accessible Facilities ●Accessibility & Public Buildings ●Disabilities Protection Are: -Vision Impaired -Limited Mobility -Wheelchair or Similar bound -Hearing Impaired -Alcoholism if person is in AA -Drug Addiction if person is in MA -HIV/AIDS |
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Housing for older Persons Act (1995) |
Over 55 Can market as age restricted 80% occupied units are 55 and older Age minimum is usually 19 Underage persons may visit on a limited bases. |
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Anti-Trust Laws |
Assures free & fair flow of goods & services in a competitive market. No monopolies No conspiracies No price fixing No group boycotting No allocation of Market Place No tie in agreements |
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Sherman Anti-Trust Act |
Conspiracy to Fix Prices Imbalanced Commission Splits Conspiracy to Boycott |
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Uniform Residential Landlord Tenant Act (URLTA) |
Limits on deposits
Reasonable rules on tenants use
Tenant may not deny the landlord access for repairs and inspection
Landlord to give the tenant notice prior to access
Landlord cannot retain the tenants property for unpaid rent |
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4 Influences on value D.U.S.T |
Demand: Purchasing Power Utility: Is it useful to the market? Scarcity: Little inventory means high demands Transferabilty: Can it be sold? |
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Uses of Appraisal |
Verify value for lenders (greatest use) Verify value for insurance companies IRS "Means Testing" Federal Institutions Reform Recovery and Enforcement. Aka. "The Bailout Act" |
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Broker |
"Special Agent" |
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Real Estate Agent |
"Sub Agent" ... agent of the agent. |
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OWNER'S Bundle of Rights |
Possession (renter) Control Enjoyment (renter) Exclusion Disposition (sell) |
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Gross Lease (Most Common) |
Tenant pays fixed monthly rent and owner pays operating expenses of the property. |
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Net Lease |
Tenant pays fixed monthly rent AND operating expenses (some or all) |
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Indexed Lease |
Rent based on inflation. |
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Escalation Lease |
Rent is tied to operating expenses |
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Appoaches to Value (Appraisal) |
Cost Approach Market Data Approach Income Approach |
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Cost Approach |
Cost Approach:●The property is re-built on paper.●This can only be used when the property doesn't produce income. ●Subtract the accumulated depreciation from the replacement cost, and add in the value of the land. |
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Market Data Approach |
Market Data Approach: ●Using Substitution ●Compares similar properties in close proximity ●Adjustments for small differences |
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Income Approach |
Value of an income producing property is a reflection of the investors required rate of return and the income the property produces. |
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Usury |
Caps amount of interest (not all states) |
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Discount Points |
1 point equals 1% of the loan amount paid upfront instead of being applied to the loan. |
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Hypothecation |
Giving property as security, but retaining use; most common for a secured lending arrangement. |
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Mortgager |
Giver of the mortgage (Borrower) |
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Mortgagee |
Receiver of the mortgage (Lender) |
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The Net Effect |
Creates a lien against the property, and allows the sale of property for the lender to be paid off. |
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Impound Account |
An impound account is an account maintained by the mortgage company to collect insurance and tax payments that are necessary for you to keep your home, but are not technically part of the mortgage. |
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Title Theory vs. Lien Theory |
W/ "Title Theory" the borrower gives the lender legal title and retains equitable title. W/ "Lien Theory" the borrower retains legal & equitable title. |
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Naked Title |
Holder didn't own, but has the right to sell. |
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Contract for Deed |
A form of seller financing |
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Amortization |
The pattern in which the principal of a loan is paid. |
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Level payment, fully amortizing loan |
Payment remains the same over the life of the loan. |
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Balloon Loan |
Requires an early payout in the end. |
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Straight Loan |
Aka "Term Loan" or "Interest only Loan". Borrower pays only interest during the life of the loan, and then principal in full. |
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Due on sale Clause |
Borrower can't transfer mortgage. |
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Assumption Clause |
Whether or not the lender will allow someone else to take over the mortgage, and with what penalties if any... |
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Blanket Mortgage |
Buying multiple parcels |
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Package Mortgage |
Provides financing for appliances, furniture, etc... |
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Wrap Around Mortgage |
Seller still owes the original mortgage, but the new buyer takes out a junior mortgage. |
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ARM |
Adjustable Rate Mortgage. Interest rates fluctuate w/ the lenders cost of funds. 6 month - 1 year intervals There are caps |
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RAM |
Reverse Annuity Mortgage. Reverse mortgage. |
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The Loan Process |
●Pre-Qualification = Credit Report ●Pre-Approval = How much you can borrow ●Loan Application = After you find a home you'll need w2's, paystubs, etc... ●Processing = Verify All Info ●Closing = Borrower signs, Escrow sends docs. |
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RESPA |
Real Estate Settlement Procedures Act. ●Inform parties about closing cost. ●Provide "Shopping for you home loan" booklet. ●Must provide good faith estimate of closing costs w/ in 3 business days. ●HUD1 must be read before closing. ●Prevents kickbacks.
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Consumer Protection Act. |
"Truth in lending Act" "Regulation Z" The purpose is to provide consumers w/ complete & understandable credit info, so the consumer can make an informed decision. ● Finance Charges ● APR ● Advertising Restrictions ● 3 day right of rescission (except consumer personal residence) -loans to individual consumers. Not businesses. |
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Riperian Rights |
Rights to owners along a river or stream. |
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Littoral Rights |
Rights of owners whose property borders a lake. |
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Trees & Crops |
Trees, Rocks, Bushes, etc... that do not require cultivation are REAL PROPERTY. Fruits, Veggies, Nuts, etc... are PERSONAL PROPERTY. |
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Changes in Border |
Accretion = Property becomes a little larger when the action of water has added to the land. Erosion = Wind, rain, or flowing water decreases land Avulsion = Sudden removal of soil by an act of nature. |
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Lis Pendens (Encumbrance) |
Gives notice that litigation is pending concerning the property. |
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Writ of Attachment (Encumbrance) |
Prevents transfer of asset until lawsuit is concluded |
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Writ of Execution (Encumbrance) |
Court directs sheriff to seize all property of the defendant in the jurisdiction. |
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Tenant in Severalty |
Only ONE owner. "Title has been severed from all others" A Corp would take Severalty as a sole owner. |
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Unity of Title |
Condition of ownership which is common to all who hold title. |
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Undivided Interest |
No owner can claim a specific physical portion. |
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Partition |
To divide out interest when there are multiple owners. ACTUALLY physically splitting the house. |
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Judicial Partition |
Selling the property and splitting the proceeds. |
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Tenants in Common |
●May be natural or non-natural. ●May own UN-EQUAL shares. ●May have aquire their interests at different times, and in different documents. ●IS Inheritable.
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Condominium neighbors. |
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Joint Tenancy |
NATURAL owners EQUAL interest Acquired their title at the SAME time on the SAME document. ISN'T Inheritable w/out JTWROS, but the new owner will now be a "tenant in common". Possesion Interest Title Time |
Owning a home together. |
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Tenancy by the Entireties |
Title for marries couples. Similar to "Joint Tenancy", but seen as ONE unity. |
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Community Property |
Acquired by either husband or wife during marriage. Not automatically inherited by spouse. |
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Separate Property |
●Acquired before marriage ●Acquired thru gift or inheritance. |
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Warranty Deed (Most Common) |
●Warranty of seisin ●Warranty against undisclosed Encumbrance ●Warranty of quiet enjoyment ●Warranty of further assurance ●Warranty forever |
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Special Warranty Deed |
Warranty against undisclosed Encumbrance |
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Quit Claim Deed |
No warranties |
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Bargain & Sale Deed |
Only "Warranty of Seisin" |
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Requirements of a Valid Deed |
●Must be in writing ●Grantor must be valid ●Grantor must be clearly indentifiable. |
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CLTA "Title Insurance" |
"California Land Title Association" Insurance. Protects & defends the title of your home. |
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ALTA "Title Insurance" |
"American Land Title Association" Insurance. ●Protects the lender, and is purchased by the buyer for the lender. ●Provides coverage beyond the CTLA. |
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Dying "Intestate" |
●Dying w/ out a will. ●State law will transfer property to heirs. |
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Dying Testate |
●Dying WITH a will |
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Devise |
When Real Property is given to a devisee by a devisor in a will. |
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Bequest |
When personal property is given away in a will. |
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Legacy |
When money is given away in a will. |
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Escheat |
Owner/Entity dies w/no heirs, so the property will go to the state. |
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Capital Gain |
Equity after you sell. The longer you owned the property the more favorable your taxation will be. |
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Taxation on the gain of a sale from of a PERSONAL RESIDENCE. |
If you owned and lived in the residence for 2 of the last 5 years you may be exempt to taxes. *Rules change from time to time.* |
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FIRPTA |
"Foreign Investor in Real Property Tax Act" Applies to the sale of properties in the U.S. by foreigners. -10% of the gross sale is withheld for IRS -Exclusions for property less than $300k |
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1031 Tax Differed Exchange |
Investors can trade/exchange LIKE properties. |
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Acre Size |
43,560 sqft |
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A Section of Land |
640 acres |
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Special Assessments |
Levied against properties for improvements of... Sidewalks Street Signs Landscaping ●Only properties that are directly affected are charged. |
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Eminent Domain |
Govnmt has the right to take your property. ●Proof that it's useful ●Payment of just compensation ●Private owner must be afforded due process |
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Condemnation |
The actual process of taking the property |
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Non-Conforming Use (NCU) |
When a property is put to a specific use w/ no zoning ordinances, but time passes, and now the use would not be permitted if it were new. It's now grandfathered in until: Use is discontinued Structure is destroyed Use is expanded Ownership changes |
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Variance |
A request for some leeway in using a Parcel which violates the zoning regulations. |
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Conditional Use Permit (CUP) |
Use does not have a specific zone to be put in. If the use does not conflict with the surrounding area, the CUP can be granted. |
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Spot Zoning |
Rezoning a small area within a zone? |
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Set Back |
Required distance between structures |
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Buffer Zone |
Required separation between conflicting uses. |
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Up Zoning Down Zoning |
Uses are added or taken away from a property. |
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Subdivision Regulations |
●Street Widths ●Street Lights ●Sidewalk provisions ●Lot Sizes ●House Sizes & Styles ●Roof types and housing elevations |
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Conditions, Covenants & Restrictions (CC&Rs) |
Like an HOA |
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Standardized Conditioned Form (SRPD) |
A form the seller fills out disclosing any defects. Filled out ONLY by the seller. Agent isn't involved. |
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3 ways to proceed with repairs |
Buyer can have the selker fix the issues. Buyer can buy the home as is. Buyer cab rescind the contract... As well as the seller if the repairs are too expensive.
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