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230 Cards in this Set
- Front
- Back
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Broker |
Any licensed person or company who, for a fee, lists, sells, negotiates, or otherwise deals with the real estate of another person. |
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Independent Contractor |
A self-employed salesperson paid on jobs completed rather than hours worked and responsible for setting their own hours and paying their own taxes. Hired to perform a specific assignment or complete a specific project but is free to accept or reject that articular assignment. |
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Multiple Listing Service (MLS) |
A listing service whereby local member brokers agree to share listings and commissions on properties sold jointly. |
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Real Estate Licensee |
A person licensed to practice real estate in Ohio. Ohio law. |
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Realist |
Any real estate licensee who is a member of the National Association of Real Estate Brokers. |
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REALTOR |
Any real estate licensee who is a member of the NAR and his affiliated state and local boards |
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Salesperson |
A licensed agent who is associated with a broker, and may perform most of the acts of a broker. Has the same fiduciary duties to the brokers client as the broker does. |
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Most salespersons are hired as? |
independent contractors |
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Auctioneer |
Person with an auctioneers license and a real estate license who can sell real estate through an auction |
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Education and Research Fund |
a fund designed to offer scholarships and loans to students taking real estate-specific classes. |
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Foreign Real Estate Broker/Salesperson |
A broker or salesperson licensed to engage in real estate sales outside of Ohio. |
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Ohio Division of Real Estate |
Run by the Superintendent who is appointed by the Director of Commerce |
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Ohio Real Estate Commission |
Consists of 5 members; four are practicing brokers, one non-broker; no more than 3 from the same political party. |
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Recriprocity |
The ability of the state department to give a real estate license to an applicant who has a real estate license in another state. |
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License Categories |
1. Broker 2. Salesperson |
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Where are licenses held? |
Broker-at their main office Salesperson-At brokers main office |
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Ohio Real Estate Commission does what? |
Makes laws |
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Ohio Division of Real Estate does what? |
Enforces laws |
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License Inactive |
When a license is returned to the Division of Real Estate, either by the salesperson or the broker. |
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License on Deposit |
1. Brokers who reactivate their sales license 2. Military |
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Real Estate Recovery Fund |
used to satisfy unpaid judgements for against licensees for activities violating license law that caused financial loss to the claimant. |
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Resigned |
Voluntary and permanent surrender of license. |
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Revocation |
When the Real Estate Commission permanently withdraws an agents license. Or when a licensee allows their license to remain suspended for more than 12 months. |
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Voluntary Hold |
License are voluntary given over to the possession of the Division |
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Suspension |
temporary withdraw of license. Automatically occurs when failure to renew on time. |
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Commingling |
Illegally mixing money held in a trust on behalf of a client with personal funds. |
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Ethics list required by the state: |
Canon of Ethics (law) |
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Ethics bound by NAR |
Code of Ethics (enforced by association) |
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Condemnation |
The action of eminent domain |
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Cost of Money |
Interest |
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Economic Base |
Main business industry that a community uses to support and sustain itself. |
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Eminent Domain |
The governments right to take private property for public use as long as the owner is justly compensated. |
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Escheat |
When property reverts to the state when there is no heirs or a valid will. |
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Immobility |
Real Estate cannot be moved from one place to another |
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Inflation |
Increase in the cost of goods or services. Too much money chasing too few goods. |
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Inverse Condemnation |
When a landowner asks the government to take their land or loosen restrictions so that the owner may use their land. |
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Land Use Controls |
Public or private restrictions on how land may be used. |
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Police Powers |
Constitutional power of state and local governments to enact and enforce laws to protect the public. |
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Taxation |
The process of the government levying a charge on a person or thing. |
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4 Broad Forces |
(PEGS) Physical Factors Economic Factors Governmental Factors Social Factors |
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Characteristics of Real Estate |
Physical: immobility, indestructibility, uniqueness Value: demand, utility, scarcity, transferibilty (DUST) |
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Governments Rights in Real Estate |
(PETEE) Police Powers Eminent Domain Taxation Escheat Environmental Laws |
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Zoning Laws |
local ordinances dividing a city, county, etc, into zones, specifying different types of land use in different areas. |
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Fiscal Policy |
Governments plan for spending, taxation, and debt management. |
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Monetary Policy |
Means by which gov't can exert control over the supply and cost of money. |
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Federal Reserve Board (Fed) |
Responsible for US monetary policy , maintaining economic stability, and regulating commercial banks. |
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Tools used by Fed |
(DORM) Discount rates Open market operations Reserve requirements Moral suasion |
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Two main government programs: |
Federal Housing Administration (FHA) Veterans Administration (VA) |
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Appurtenance |
A right that goes with ownership of real property, usually transferred with the property but may be sold separately. |
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Easement |
A right to use some part of another persons real property for a particular purpose. Irrevocable and creates interest in the property. |
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Encumbrance |
Non-possessory interest in property which burdens the property owners title. (lien, easement). |
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Fixture |
An item of personal property that may or may not become real property, but us closely associated with real property that it is legally intended to become real property. |
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Freehold Estate |
Possessory and ownership estate in real property. Either a fee simple or a lie estate. Owner has title. |
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Leasehold Estate |
An estate that gives the holder (tenant) temporary possession of the estate without having title. |
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Lien |
Nonpossessory interest in property, giving the lienhloder the right to foreclose if the owner does not pay a debt owed. A financial encumbrance on the owners title. |
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Bundle of Rights in Real Property |
1. Right of use 2. Right of enjoyment 3. Right of disposal |
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2 Types of fee simple defeasible estates: |
1. Fee simple determinable 2. Fee simple conditional |
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Fee Simple Determinable |
defeasible fee estate terminated AUTOMATICALLY if certain conditions occur. |
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Fee Simple Conditional |
A defeasible fee estate that MAY BE terminated by the owner if conditions stated in the deed are not met. |
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Life Estate |
A Freehold Estate that lasts only as long as a specified person lives. |
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Life Tenant |
The holder of a life estate. |
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Life Estate Pur Autre Vie |
For another's life (those incompetent to own). |
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Dower |
A Special real property interest provided to a spouse when a married person owns property. |
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Estate for Years |
Any leasehold estate for a fixed time period. |
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Periodic Tenancy |
A leasehold estate for a duration of time, not a specified date. (Ohio) |
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Tenancy At Will |
A leasehold estate with no specific termination date or specified period of time. |
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Tenancy At Sufferance |
Possession of property by a holdover tenant. |
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Holdover Tenant |
Someone who cam into possession of property under a valid lease, but stays on after the lease expires, without the landlords permission. |
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Eviction |
Dispossessing or expelling someone from real property. |
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Legal Eviction Process ( Steps): |
1. Notice to vacate 2. Forcible entry and detainer action (4 able-bodied adults have 90 mins to do so). 3. Writ of Execution |
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Notice to Vacate |
Notice to a tenant demanding that he vacate the leased property. |
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Forcible Entry and Detainer Action |
A lawsuit filed by a landlord to evict a defaulting tenant and regain possession of the property. |
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Writ of Execution |
A court order directing a public officer to seize a nd/or sell property to regain possession for the owner and/or satisfy a debt. |
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Appurtenant Easement |
Burdens one piece of land for the benefit of another. |
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Servient Tenement |
The land burdened by the easement. |
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Easement in Gross |
Benefits a person only and not the land. |
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Easement by Express Reservation |
Created in a deed when a landowner divides property and includes language in the deed that transfers the servient tenement to the buyer, but retains a dominant tenement to the seller. |
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Easement by Express Grant |
Created in a deed or other document and must be in writing to be valid. |
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Easement by Implication |
Created by law when law when land is divided, and there is ling-standing apparent use that is reasonably necessary for the enjoyment of the dominate tenement. |
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Easement by Necessity |
Created when a property would be completely useless without an easement against another property. (landlocked land). |
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Easement by Perscription |
Created by open and notorious, and hostile and adverse use of another persons land for 21 years. |
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Release (Easement Termination) |
A document in which a legal right is given up. Should be recorded. |
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Merger (Easement Release) |
Uniting two or more separate properties by transferring ownership from all to one person. |
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Abandonment (Easement Termination) |
Failure to occupy and use property, which may result in a loss of rights. |
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Prescription (Easement Termination) |
Occurs after 21 years of non-use. |
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Destruction (Easement Termination) |
The object of the easement is destroyed (bridge collapse). |
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Failure of Purpose (Easement Termination) |
When the purpose for which it was created no longer exists. |
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Encroachment |
A physical object intruding into a neighbors property. |
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Lien |
A non-possessory (financial) interest in property. |
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Foreclosure |
A property is sold so unpaid debt secured by the lien can be satisfied by the proceeds of the sale. |
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Voluntary Liens |
Liens placed against property with consent of the owner (home equity loans). |
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Mortgages |
Written instruments, which are signed by the owner (mortgagor) and given to the lender (Mortgagee), that use real property to secure the payment of a debt. |
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Default |
The failure to fulfill and obligation, duty, or promise, as when a borrower fails to make payments. |
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Involuntary Liens (General) |
Attaches to all property owned in the county by the debtor. |
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Involuntary Liens (Specific) |
Attaches to specific property. |
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Mechanics Liens |
Involuntary, specific liens claimed by someone who has done work on real property and has not been paid. |
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Tax Liens |
Liens on real property to secure the payment of real estate taxes. |
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Attachment Liens |
Liens intended to prevent transfer of a property, pending the outcome of litigation. |
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Property Tax Liens |
Superior to all other liens on a property. |
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Adverse Possession |
Acquiring title to someone else's real property by possession of it (open and notorious, hostile and adverse, exclusive, for more than 21 years.) |
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Variances |
Grant permission to a property owner by zoning authority, allowing some deviation from strict compliance with the zoning law. |
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Rezoning |
Change in zoning law. |
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Spot Zoning |
Illegal rezoning that restricts or favors one landowner without justification. |
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Private Restrictions (Deed Restrictions) 2: |
1. Conditions 2. Covenants |
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Conditions (Deed Restrictions) |
Provisions in a deed that make the parties rights and obligations depend on the occurrence or non-occurrence of a particular event. |
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Covenants (Deed Restrictions) |
Promises or guarantees, either expressed or implied, in a deed. |
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Agent |
Person licensed to represent another in a real estate transaction. |
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Customer |
A party within a transaction with whom and agent does not have fiduciary duty or relationship, but with whom an agent must still be fair and honest. |
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Fiduciary |
Someone in a position of trust and confidence held by law to high standards of good faith and loyalty. |
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Fraud |
An intentional or negligent misrepresentation or concealment of a material fact. False and misleading. |
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Management-Level Licensee |
A licensee who is employed by or affiliated with a real estate broker and who has supervisory responsibility over other licensees employed by or affiliated with that real estate broker. |
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Principal is also known as: |
The client |
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Universal Agent |
Authorized to do everything that can be lawfully delegated to a representative. |
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General Agent |
Authorized to handle all of the principals (clients) affairs in one area or in specified areas. |
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Actual Authority |
Power or permission given intentionally to an agent by the principal (client), expressly or by implication. |
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Split Agent |
A licensee assigned by a broker to represent a buyer or seller in a transaction, usually in an in-company dual agency situation. |
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Agency Relationships |
1. Agency relationship between licensee and seller 2. Agency relationship between licensee and buyer 3. Dual agency relationship between a licensee and both seller and buyer. 4. In-company or "sub" agency relationship between two licensees in the same brokerage. |
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Five Models of Business for Brokers (6) |
1. Practicing split agency and dual agency 2. Practicing dual agency for all in-house transactions (team company) 3. Practicing exclusive buyer agency only 4. Practicing exclusive seller agency only 5. Practicing split agency but no dual agency 6. Represents both buyer and seller, but rejects split and dual. |
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When do you present the Consumer Guide to Agency Relationships to the buyer? |
At the first sign of 4 triggering events: 1. Before showing (excludes open houses) 2. Before prequalifying 3. Before discussing terms of sale 4. Before discussing terms of offer. |
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When do you present the Sellers Guide to Agency Relationships to the seller? |
At he first sign of 2 triggering events: 1. Before Marketing 2. Before showing the property |
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Agency Disclosure Form |
Discloses the actual agency relationship |
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Fiduciary Responsibilities (OLD CAR) |
Obedience Loyalty Disclosure Confidentiality Accountability Reasonable care (and skills) |
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Limited Service Agent |
One whose client has waived certain responsibilities to the agent. |
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Caveat Emptor |
Let the buyer beware |
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Latent Defects |
Defects that are not visible or apparent |
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Patent Defects |
Visible defects that could be discovered in an inspection |
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Constructive fraud |
negligent misrepresentation |
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Puffing |
and exaggeration of an opinion |
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An agent or seller is protected from misrepresentation when statements are: |
Opinions, Predictions, or Puffing |
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Penalties for Breach of Duty |
1. Disciplinary action by professional associations 2. Action by the Ohio Division of Real Estate 3. Civil lawsuits filed by injured parties 4. Filing of criminal charges against the agent |
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When can an agency be terminated? |
1. Accomplishment of purpose 2. Expiration 3. Operation of law (if certain events occur) 4. Mutual agreement 5. Renunciation (resign agency- breach of contract) 6. Revocation (withdraw agency- breach of contract) |
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Agency Coupled with an interest |
when an age has a personal interest in the subject of the agency |
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Acceptance |
Agreeing to the terms of an offer to enter into contract. |
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Assignment |
1. When a person transfers his interests under a contract to another. 2. When a tenant transfers his right of possession to another person for the remainder of the lease term. |
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Consideration |
Anything of value (usually money) given to induce another person into contract. |
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Counteroffer |
Response to an original offer, a rejection to it. offering new terms |
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Material Breach |
An unexcused failure to perform according to the terms of a contract. |
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Novation |
The substitution of one contract for another. |
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Offer |
When on person proposes a contract to another |
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Specific Performance |
When a court orders the breaching party of a contract to perform as agreed. |
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Statue of Frauds |
A law that requires certain kinds of contracts to be in writing and signed in order to be enforceable. |
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Tender |
An offer by one party of a contract to perform his agreement, making him able to sue if other party breaches. |
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Express Contract |
Agreement that has been expressed in words, spoken or written. |
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Implied Contract |
Agreement that has not been put into words (Not acknowledged in Ohio) |
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Unilateral Contract |
When only one party makes a legally binding promise to the other party (not acknowledged in Ohio). |
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Bilateral Contract |
When each party makes a promise to each other. |
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Executory Contract |
A contract which one or both parties have not completed their obligations (in process). |
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Executed Contract |
Both parties have completed performances. (mostly done) |
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Valid Contract |
Binding, legally enforceable contract. |
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Void Contract |
Not enforceable because it lacks an offer, acceptance, and/or consideration, or it is defective. |
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Voidable Contract |
One of the parties can disaffirm, without liability because of a lack of legal capacity or negative factor. |
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Unenforceable Contract |
One that a court would refuse to enforce (vague). |
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5 Essential Elements for a Valid Contract |
1. Contractual capacity 2. Offer 3. Delivery with Acceptance 4. Consideration 5. Lawful and possible objective |
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Contractual Capacity |
Legal ability to enter a contract. |
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Requirements for an offer (2): |
1. Must express and intent to contract 2. Must have definite terms |
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Requirements to terminate an offer (4): |
1. Lapse of time 2. Death or incapacity 3. Revocation 4. Rejection |
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Acceptance |
When the party agrees to the terms of an offer to enter into a contract. |
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Requirements for Acceptance (4): |
1. May be made only by offeree 2. Must be communicated to the offeror 3. Must be made in the manner specified (if there is one) 4. Must not vary the terms of the offer |
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Mailbox Rule |
An acceptance is considered delivered when it leaves the acceptors control. (applies only to acceptances) |
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Earnest Money |
An inducement to have the buyer's offer accepted and a means of showing the seller that the buyer is serious and able to follow through with the financing necessary to buy the property. |
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Earnest can only be released when (3): |
1. Completion of the sale 2. A mutual release is signed by all parties to the contract 3. Court order |
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Lawful and Possible Objective |
the purpose or objective of a contract must be lawful at the time the contract is made. |
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Severable |
One party or provision of a contract can be held unenforceable without making the entire contract unenforceable. |
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Power of Attorney |
An instrument authorizing one person to act as another's agent. |
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Parol Evidence |
Evidence concerning things not in the contract that contradicts the contract |
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A contract can be terminated by: |
1. Absence of genuine assent 2. Assignment 3. Conditions (contengencies) 4. Mutual Agreement |
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Genuine Assent |
Consent must be freely given to create a binding contract. |
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Duress |
threatening violence against, or unlawfully confining, a person to force him to sign a document. |
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Undue Influence |
exerting excessive pressure on someone |
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Accord and Satisfaction |
Agreement to accept something different than the original contract called for. |
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Rescission |
Terminate and give back |
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Cancellation |
To terminate a contract |
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Substantial Performance |
Promisor doesnt perform all obligations but does enough. |
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Mitigation |
When the non-breaching party takes action to minimize losses in a breach. |
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Liquidated damages |
A sum of money agreed to be paid if someone breaches the contract. |
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Listing Agreement |
written agency contract between seller and broker stipulating that the broker will be paid commission for finding a buyer |
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Types of Listing Agreements (4): |
1. Exclusive right to sell 2. Exclusive agency 3. Open listing 4. Net listing |
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Exclusive Right to Sell |
Entitles the broker to a commission if anyone, including the seller, finds a buyer during the listing term. |
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Exclusive Agency |
Entitles the broker to a commission if anyone other than the seller finds a buyer. |
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Open Listing |
non-exclusive listing given by a seller to as many brokers as he chooses. Broker makes commission only if he makes the sale. |
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Net Listing |
Seller sets a net amount he is willing to accept with broker being entitles to excess as commission. |
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Purchase Contracts |
Contracts where a seller promises to convey title to real property to a buyer in exchange for purchase price. |
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Options |
Contracts that give one party the right to do something, without obligation to do it. |
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Right of preemption |
Right to have the first chance to buy or lease a property if the owner decides to sell or lease. |
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Leases |
Contract in which one party pays the other rent in exchange for possession of real estate. |
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4 Types of Leases |
1. Gross Lease 2. Net Lease 3. Percentage Lease 4. Land Lease |
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Gross Lease |
The owner or landlord pays all property taxes, mortgage payments, insurance, etc. and tenant pays all utilities. |
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Net Lease |
Tenant pays all property taxes, mortgage payments, insurance, utilities, and monthly rent. |
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Percentage Lease |
Tenant pays a percentage of gross sales, and often a fixed monthly rent. Utilities may or may not be included. |
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Land Lease |
Tenant leases only the land, but tenant owns the building. |
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Land Contracts |
Buyer makes payments to the seller for right to occupy property but no deed or title is transferred until all payments have been made. |
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Equitable Titile |
Buyer' present interest in a land contract. |
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Acknowledgement |
When a party signing a document officially declares to an authorized official that he signed voluntarily. |
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Attestation |
The act of signing a document in front of two witnesses to affrm the parties signatures are real. |
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Deed |
Conveys the grantor's interest in the real property. |
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Requirements for a Deed |
1. Competent grantors signature 2. Identifiable grantee 3. Words of conveyance 4. Description 5. Consideration 6. Acknowledgement 7. Delivery and Acceptance |
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Title |
actual lawful ownership of real property |
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Words of conveyance |
clause in the deed that states the grantor intends to convey title to the land. |
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Government Survey System |
Legal description for land referencing principal meridians and base lines designated throughout the country |
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Townships |
six by six mile squares. |
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Acres in 1 sq mile? |
640 |
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Feet in 1 acre? |
43,560 ft |
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Lot and Block Description |
Legal description used for platted property |
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Platted Property |
any property that has been subdivided from a large tract to smaller lots |
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Plat map |
detailed survey map of a subdivision or other grouped lots of land |
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Metes and Bounds |
Legal description that starts at an easily identifiable point of beginning (POB), the describes the properties boundaries in terms of courses and distances, ultimately returning to the POB. |
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Warrtay Deeds |
Carry warranties of clear title and the grantors right to convey title |
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General Warranty Deed |
The grantor warrants the title against defects that might have arisen before or during his period of owner ship (best for buyer/worst for seller). |
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Limited Warranty Deeds |
The grantor warrants the title only against defects during the time that he owned the property, and not before. |
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Quitclaim Deeds |
Convey interest in real property the grantor has at the time the deed is executed. I dont know if i own it, but you can buy any rights that i may have to it. (Best for seller/worst for buyer) |
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Fiduciary Deeds |
executed by the fiduciary conveying property that the fiduciary does not own but is authorized to manage. |
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Ownership in Severalty |
ownership by a single person or corporation |
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Co-ownership |
two or more people share title. |
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Real Estate Investment Trust (REIT) |
RE investment business with at least 100 investors, organized as a trust. |
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Syndicates |
informal partnership |
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Bylaws |
rules that govern the condo association and owners |
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Cooperatives |
Buildings owned by corporations, residents are shareholders |
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Proprietary Lease |
longer term, shareholders have more rights. |
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Tenancy in Common |
A form of co-ownership where two or more persons each have an undivided interest in the entire property , but no rights of survivorship. |
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Statutory Survivorship Tenancy |
a form of co-ownership in which each co-tenant has an equal undivided interest in real property, and the right of survivorship (Tenants in common) similar to joint tenancy. |
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Unities of Joint Tenancies (PITT) |
1. Possession 2. Interest 3. Time 4. Title |
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Tenancy by the Entries |
For married couples, cant do it today. protects spouse from estate tax and probate. |
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Actual Notice |
actually knows it |
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Constructive Notice |
Ought to know |
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Chain of Title |
Chain of deeds passing title for a property from one owner to the next , as disclosed in public record. any other deed is considered a wild deed. |
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Inquiry Notice |
there is some indication of a claim or other circumstance that would lead them to be alerted that there is a problem. |
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Race/Notice Rule |
Whoever records the deed first wins |
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Marketable Title Act |
Not necessary to search back more than 40 years. |
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Proration |
Division of expenses between buyer and seller in proration to the actual usage of the item. |
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Real Estate Settlement and Procedures Act RESPA |
Federal law dealing with real estate closings that sets forth specific procedures and guidelines for disclosure of settlement costs. |
