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Texas Real Estate National Exam Prep
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Terms in this set (381)
interest only until the end of the term, when the entire principal is repaid. This is a zero-amortization loan. This is also called a ________________
Term loan; straight-loan
Title is both the ownership of something and the legal evidence of that ownership _______________
a deed
What happens if the life tenant leases the property and then dies?
the lease expires
What ownership with the greatest bundle of rights - the best type of ownership?
Fee Simple or Fee Simple Absolute.
What are the responsibilities of a condominium manager?
They w ork for resident owners and preserve property values.
Real Property consists of
land,
improvements attached to the land,
benefits,
rights, and
ownership interests that go with the land
What is often used to describe rights, privileges or
improvements that belong to and pass with the land?
appurtenance
What are man's additions to the land such as buildings and landscaping?
Improvements
________________ is a right or interest in something of a temporary or movable nature and includes anything not classed as real property.
Personal property
Personal Property is also called _______________ or _______________
Chattel or Personalty
How is ownership transferred?
Bill of Sale
A ___________ is an item that was personal property; however, it has been attached in such a way that it has become real property.
fixture
What often indicates a permanent attachment?
installed
What is the process of attaching a fixture?
annexation
The process of real property becoming personal will be described by what term?
Severed or Severance
What are the tests to determine if something is a fixture?
Method of Attachment; Adaptation to the property; the intention of the parties
In residential listing, are fixtures installed by the tenant considered part of the real property?
Yes, unless severance is mutually agreed.
What are fixtures called in commercial property?
Trade Fixtures
What are installed by a tenant in order to carry out a business?
Trade Fixtures
Crops cultivated annually are considered?
Emblements
What are the Characteristics of Real Property?
NonHomogeneity
Immobility
Indestructable
Two pieces of property that are not alike and unique are called?
Nonhomogeneity
Land that cannot be moved is called?
Immobile
What is something that is durable and will always be there?
Indestructible
What are the four economic characteristics?
Scarcity; Modification; Fixity; Situs
What is in short supply where demand is great and is based on geographic considerations?
scarcity
What is land, buildings, and other improvements that are considered fixed or permanent?
fixity
Land use and value are greatly influenced by improvements made by man?
modification
Location preference, or location from an economic rather than a geographic standpoint?
situs
Who creates a legal description is determined by?
a surveyor
What is necessary part of a contract or conveyance in order for that document to be enforceable?
a legal description
What are the methods of land description are legal?
Metes and Bounds; Lot and block; Rectangular survey system
What uses terminal points and angles and always has a point of beginning?
Metes and Bounds
What is the oldest and most common method of land description?
Metes and Bounds
What is derived from a recorded map, mostly seen in residential listing agreements?
Lot and Block
A recorded map is called a ___________
plat
The Rectangular Survey System is also known as ______________
The Government Survey System
What takes into consideration base lines, and meridians, townships and sections?
The Rectangular Survey System
Townships and Sections are located in what?
Ranges
One township contains how many sections?
36
Each section contains how many acres, which is 1 sq miles?
640
How many acres are in a square mile?
640
Each acre contains how many square feet?
43,560 square feet
What does PETE stand for that describes Governmental rights in land?
Police Power; Eminent Domain; Taxation; Escheat
What is the power given to a municipality to regulate and control the character and use of property for the health, safety and general welfare of the public?
police power
What is the most common kind of police power?
zoning
A change in zoning may result in what?
non-conforming use
What can a property owner do if their property violates zoning requirements?
file a variance
What allows for a higher population density with houses clustered together, leaving more green area open for parks and recreation?
planned unit development (PUD)
Who controls zoning rules?
zoning committee
What is an area of land separating one land use from another, such as residential from commercial?
buffer zone
What provides the government with the right to establish building codes?
police power
What is the right of the government to take private property for public use through the action of condemnation?
eminent domain
What is the act of taking property from a property owner?
condemnation
What do we call when an individual forces the government to buy property?
inverse condemnation
What is the highest priority lien on real property?
property taxes
What does ad valorem stand for?
according to value
If a property is foreclosed on, what lien will be paid first?
property taxed
What is this called when a property reverts to the state when someone dies leaving no will and no heirs or
kindred?
escheat
What are the most common private controls of land use are?
CC&Rs - deed covenants, conditions and restrictions
What is imposed to control land use, development and methods and materials for construction?
deed restrictions
The Declaration of Restrictions are imposed by who?
grantor
What will the courts impose to force compliance with the deed restrictions?
injunction
A _____________, imposed by the grantor, withholds title to a part of the land described in the deed
(Example: an easement or mineral rights).
reservation
When a structure or improvement overlaps or trespasses onto another's property, what is it called?
encroachment
What is the determination of an encroachment?
survey
What allows limited use or enjoyment of another's land?
easement
How are easements created?
Implied or express
How can an easement be terminated?
merger (acquiring the adjacent property), release, or abandonment
If you have two parcels of land with a road across one parcel, the owner who crosses over the other's land is called what?
Dominant and Servient Estates
The ________________ with the road is servient to the dominant estate
property
A property that is landlocked is called _________________
Easement Appurtenant
An ________________ belongs to a person or corporation
Easement in Gross
What is an example of Easement in Gross?
utility easement
A _____________is permission to do a particular act upon the land or property of another
license
________________ occurs when property is acquired from the rightful owner through the Statute Of Limitations.
Adverse Possession (squatter's rights)
What is the required occupancy time for adverse possession?
3 years to 25 years but is often 10 years in texas
_____________ is a recorded notice filed against a specific property, meaning that some form of lawsuit has been filed, but not yet resolved in court.
Lis pendens
What are the different types of ownership?
estate of severalty; tenancy in common; joint tenancy; tenancy by the entirety; property held in trust; two or more join together to create & operate a real estate investment
What type of ownership is in when it is a sole ownership?
estate in severalty
What type of ownership is in when ownership is by two or more WITHOUT rights of suvivorship?
tenancy in common
Upon your death in a tenancy in common, your share will go to your heirs after it passes what court?
probate
What type of ownership is in when ownership is by two or more WITH rights of suvivorship?
joint tenancy
Upon your death in a joint tenancy, who gets your shares?
immediately goes to surviving co-owners
In a joint tenancy, when one dies their shares immediately goes to surviving co-owners, is called ___________________?
poor man's will
What overrides a will?
joint tenancy
To prevent any accidental cases of joint tenancy, there are four unities required for this type of ownership, what are they?
time, title, interest and possession
What is a procedure to divide the co-tenant's interests in real property?
Partition
What would divide the property into pieces and end the joint tenancy?
Partition
What is a specific type of joint tenancy where the co-owners are married to one another: husband/wife, spouse/spouse?
Tenancy by the entirety
What is one advantage of tenancy by the entirety & joint tenancy?
they avoids probate
What do we call it when two or more parties join together to create and operate a real estate investment?
syndicate
Why is it important for licensee to understand the different types of ownership?
to know what signatures are needed
The word tenant can indicate what?
owners, as in joint tenants and tenants in common
What are some special kinds of ownerships?
timeshares; condominiums; cooperatives
What gives an individual part ownership of a property coupled with the right to exclusive use of it for a specified number of days per year, without the responsibility of full ownership?
Time Shares
Times Shares cam also be called _______________
interval ownership
What is an investment for residents. The land and buildings are owned by a corporation.
Cooperative or "Co-ops"
Who pays for the mortgage, property taxes and maintenance of the building in a co-op?
the corporation
What is established under laws referred to as horizontal property acts. Each unit is a separate legal ownership and each owner arranges his or her own financing.
Condominiums
What is an estate?
an interest in real property
What is a freehold estate?
ownership
All the legal rights that attach to the ownership of real property including but not limited to the right to sell, lease, encumber, use, enjoy, exclude, will to heirs, etc.
are called ___________________?
the Bundle of Rights.
___________________ is ownership with conditions or terms, which if violated, could cause the ownership interest to be defeated or terminated.
Fee simple defeasible
Fee simple defeasible can be ___________________ or ___________________
determinable; condition subsequent
In condition subsequent, the ___________________ must take steps to reclaim the property within a reasonable period of time if the condition is violated or the conditional use is terminated.
grantor
What is ownership for the duration of someone's life?
life estate
The owner is called the ____________
life tenant
The life tenant has all the rights and duties of an owner, except ______________________________
the right to choose who will get the property upon his or her death
The person who gets the property after the life estate is ended is the ________________.
remainderman
If the life estate is based on the life of someone other than the life tenant, this is called a ________________.
life estate pur autre vie
If a life estate is set up so that at the end of the life estate the property goes back to the original owner, this is called a ________________.
life estate with reversion
Lease agreements create the ________________.
leasehold estate
What are four leasehold estates and each gives possession
without ownership.
estate for years;
periodic tenancy;
estate at will;
tenancy at sufferance
What is a lease with a specific starting and ending date?
estate for years
What is a lease with a fixed period that is automatically renewed unless the tenant or landlord acts to terminate it?
periodic tenancy
Approx how many days is required to terminate a periodic tenancy?
30 days
What is a lease that can be terminated by either party at will without notice?
estate at will or tenancy at will
What occurs when a lease expires and the tenant refuses to move out?
tenancy at sufferance
If the holdover tenant pays rent and the landlord accepts that rent, a ________________ is created.
holdover tenancy
What are the different types of leases?
1.) Gross Lease
2.) Net Lease
3.) Percentage Lease
4.) Graduated Lease
5.) Lease-purchase agreement
6.) Ground Lease
7.) Oil & Gas Lease
This kind of a lease, the landlord pays all the expenses of the property. The tenant pays only rent. What is it?
gross lease
This kind of a lease - the tenant pays rent plus some of the expenses of the property. What is it?
Net Lease
This kind of a lease - lease in which all or part of the rent amount is based on the receipts of the tenant's business (Typical shopping center lease). What is it?
Percentage Lease
This kind of a lease - a lease with scheduled rent increases often based on expected business growth. What is it?
Graduated Lease
This kind of a lease - also called a lease with an option to buy - gives a tenant the right to purchase at a future date. What is it?
Lease-purchase agreement
This kind of a lease - the tenant is usually making a long-term commitment, up to 99 years. This lease is more often for industrial or commercial land use. The tenant will build on the leased property. What is it?
Ground Lease
This kind of a lease - this lease gives the tenant the right to extract oil and gas from a specific property. What is it?
Oil and Gas Lease
What is a landlord who is usually prohibited from entering leased property unless there is a need for maintenance, inspections or emergency response?
Covenant of quiet enjoyment
What is the tenant who has the right to match or better any offer before the property will be sold to someone else?
Right of First Refusal
What is the transfer of all rights and liabilities to a new tenant under an existing lease?
Assignment
What is the legal term for eviction?
Forcible entry and detainer, or an action of forcible detainer
What is the rental income as stipulated by the parties in a contract?
Contract rent
What is the rent the property could currently command on the open market?
Economic rent
What is it when the lease comes to the end of the negotiated term or lease period?
Expiration
What is it when the time period on a lease ends or is cut short.
Termination
What is it when a lease is terminated by agreement of the parties?
Mutual rescission
What occurs when a landlord is aware of a property condition and allows deterioration to the point that the building is uninhabitable and the tenants are forced to leave?
Constructive eviction
What is it when a property owner sells property to an investor or lender and then leases it back. Therefore, the seller occupies the property after closing.
Sale and leaseback
What is a charge against property as security for a debt, also is an encumbrance?
lien
What is an outstanding claim or encumbrance that will impair the owner's title?
cloud on the title
What is created by the lienee's or borrower's actions, like taking out a mortgage or home improvement loan?
voluntary lien
A mortgage is not effective or enforceable until it is ___________________.
recorded
When the mortgage is recorded, if it is the first recorded claim, it will be the ________________________.
first priority lien
An __________________ lien is created by law and can be __________________ or __________________.
involuntary; statutory; equitable
Liens can be __________________ or __________________.
specific; general
A __________________ lien attaches to one or more specific or named properties
specific
A __________________ lien attaches to all the property of the debtor, not exempt from forced sale.
general
What is required for a judgment to become a lien?
Recording
What is it called when a party wins a judgment and is unable to collect?
writ of execution
What are mineral, air and water rights are all considered part of?
real property
What are the different types of land rights?
Surface, subsurface & air rights
_______________ consist of rights to subsurface land and profits.
Mineral rights
_______________ consist of the right to use open space above your land.
Air rights
The right to use water from a river or stream that borders your property would be _______________
riparian rights
The right to use water from a lake or ocean would be _______________.
littoral rights
The state has the right to refuse to grant ______________. One reason for this would be a scarcity or shortage.
water rights
For non-navigable waterfront property, landowners may own to the ______________ of a body of water.
middle
For navigable waterfront property, landowners own to the ______________.
vegetation line
Can you extend your property line by building a pier?
No.
Who owns all navigable water?
The state
_________________ is a theory of water law based on the idea that "first in time is first in right."
Prior Appropriation
Who has exclusive right to water?
The first person to claim the rights
A change of ownership of real property is called _________________
alienation
_________________ occurs when an owner transfers title to another
Voluntary alienation
Voluntary alienation usually involves a written document called a _________________
conveyance
_________________ usually happens in court as in foreclosure, bankruptcy, condemnation, escheat, adverse possession, reversion of defeasible fee, partition, or inheritance without a will.
Involuntary alienation
Involuntary alienation can also occur from natural causes including ____________ and ____________ which result in an increase in property size, and ____________ and ____________ which result in a loss of land.
accretion; reliction
erosion; avulsion
a written statement that indicates transfer of some interest in real property from one person to another. What is it called?
Words of conveyance
the grantor must sign the deed. What is it called?
Execution
Title does not pass until what happens?
Must be delivered and accepted
What are the requirements for a Valid deed?
1.) Have a Grantor and Grentee
2.) Consideration
3.) Words of Conveyance
4.) Execution
5.) Delivery
6.) Legal Description
What are the different types of deeds?
1.) General Warranty
2.) Special Warranty
3.) Bargain and Sale
4.) Quitclaim
What guarantees and protects against defects, It offers the buyer the best protection?
General Warranty Deed
What guarantees title only against defects arising under the grantor's period of ownership?
Special Warranty Deed
What kind of a deed does not provide any warranties about the condition of the title, but only promises the grantor has the right to convey the title?
Bargain and Sale Deed
What kind of a deed that gives NO warranties or guarantees and offers the least protection? It is used to clear a cloud on the title or to cure a defect in title.
Quitclaim Deed
Deeds often contain covenants and warranties to the buyer. The five most common are:
1.) seizin
2.) quiet enjoyment
3.) further assurance
4.) encumbrances
5.) warranty forever
the grantor claims to be the owner with the right to sell the property
covenant of seizin
the grantor promises the new owner will not be disturbed
with claims against the property
covenant of quiet enjoyment
the grantor is responsible for any documentation
needed to ensure title is transferred to the grantee
covenant of further assurance
the grantor promises that all encumbrances have been disclosed
covenant against encumbrances
the grantor's promises have no expiration date
covenant of warranty forever
When a developer turns over the streets in a subdivision to the local government, this is called __________________________.
dedication
A party who makes a will is the __________________________.
testator
One who has a valid will is __________________________
testate
The person named in the will to settle the estate is called the __________________________
executor
The property is the devise and the heir is the __________________________
devisee
One without a will is __________________________
intestate
The heirs will inherit real property according to the Laws of Descent and will have __________________________. Spouse and children have priority under this law.
Title by Descent
The judicial process to prove or confirm a will, or to settle the estate of a party who dies intestate is called __________________________
probate
Title to real property passes at probate and that title transfer is final in how many days?
30 days
Any excess money left over from the forced sale is given to the debtor. In the event of a shortage, the lender may sue the borrower for a __________________
Deficiency Judgment
What is wiped out at foreclosure?
junior liens
What is an alternative to foreclosure? It is sometimes called "friendly foreclosure" or "voluntary deed."
deed in lieu of foreclosure.
What is it called when a person at any time up to the moment of the foreclosure, the borrower has the right to step in and pay what is owed and reclaim property forfeited due to mortgage default?
Redemption
equity of redemption, or equitable redemption.
How many days does the lender have to send the notice of foreclosure by certified mail before the foreclosure sale?
21 days
When are foreclosure sales held in Texas?
first Tuesday of the month
A sale of secured real property that produces less money than is owed the lender - the ffslender releases its lien so property can be sold to the new purchaser.
Short Sale
____________________ is a class of property owned by a lender—typically a bank, government agency, or government loan insurer—after an unsuccessful sale at a foreclosure auction.
Real-estate owned or REO
A ____________________ agrees to compensate or reimburse the insured against any losses sustained as a result of defects in the title, other than those exceptions listed in the policy.
title insurance policy
This clause allows the title company to assume the rights of a buyer with respect to any claim against a seller, if the title company has made payments to that buyer to satisfy that claim.
subrogation clause
What is a complete history of title?
abstract of title
What is a list of all owners from the first until today?
chain of title
If no one is available to sign a quitclaim, then a court procedure to cure or quiet the cloud can be used.
This is called an _________________________
"action to quiet title" or a quiet title suit.
The most significant type of value for real estate licensees is _________________________
market value
_________________________ is defined as the price a willing seller will sell for, and the price a willing buyer will pay, when neither is acting under exceptional pressure. Also, defined as the most probable price.
Market value
There are four basic characteristics of value: (DUST)
Demand
Utility
Scarcity
Transferability
What is it when the item must be needed or wanted?
Utility
What is an opinion or estimate of value?
the appraisal
the legal use that gives the greatest return in money and/or amenities.
Highest and Best Use
sets an upper limit on price. Maximum value of a property is set by the cost of acquiring a similar substitute property
Principle of Substitution
states that maximum value is found when there is a reasonable degree of similarity or sameness
Principle of Conformity
the presence of higher-valued properties will increase the value of your property and this is called _______________________
Principle of progression
the presence of lower-valued properties in the neighborhood leads to a decline in the value of your property.
Principle of Regression
purchase price is affected by the expectation of future
appeal and benefits
Principle of Anticipation
mixed land use should result in maximum value for all properties involved (master-planned communities demonstrate this principle).
Principle of Balance
The steps in the appraisal process are:
1. State the purpose of the appraisal
2. Collect and verify information about the property
3. Estimate value
4. Reconcile the estimates
5. Prepare the report
All appraisers must adhere to the ___________________ outlining how appraisals are developed and communicated.
Uniform Standards of Professional Appraisal Practice (USPAP)
There are three basic approaches to appraisal:
1.) market data approach
2.) cost approach
3.) income approach
The ______________ is used for unique properties, such as churches or government buildings.
cost approach
The appraiser considers three types of depreciation in the cost approach -
1.) physical deterioration,
2.) functional obsolescence
3.) external obsolescence.
Ordinary wear and tear is called what?
physical deterioration
_____________ is brought about by factors in the property. It is often or mostly curable (inferior materials to cut costs, curb appeal, not enough baths/bedrooms, an unpopular floorplan, property that lacks updating for modern technology).
Functional obsolescence
_____________ is a loss of value due to outside factors.
External obsolescence
The _____________ in the income approach helps an investor determine interest.
capitalization rate
Licensees or appraisers may use the _____________ as a simple technique to determine a range of value
Gross Rent Multiplier (GRM)
The _____________ is a factor based on location and rent - a price per rent.
Gross Rent Multiplier (GRM)
A _____________ is a tool used by licensees to help sellers determine a realistic price for their property.
Comparative Market Analysis (CMA)
What is basically the same as a CMA?
Broker's Price Opinion (BPO)
________________ is the value of your property for tax purposes.
Assessed value
Some states have a property sales tax, usually paid by the seller of real property at closing. It can be called a "________________ or a "________________ "
transfer tax; deed tax
What is a mill?
rate per hundred
If the local government is providing a benefit to a limited number of property owners, such as curbs or sidewalks in a neighborhood, a ____________________ may be levied against only those property owners who benefit from the improvement.
special assessment tax
Contracts can be _________ or _________
express;implied
An _________ contract is written or stated.
express
An _________ contract is by actions or evidence.
implied
A _________ contract binds only one party
unilateral
An _________ on is a unilateral contract.
option
An _________ contract is the right to purchase property within a definite time period at a definite price.
option
A ________________ is an exchange of promises, which binds both parties. A sales contract is a ________________
bilateral contract; bilateral contract
For a contract to be valid, the contract must have the following: (COLIC)
1. Competent parties
2. Offer and acceptance
3. Legal purpose
4. In writing
5. Consideration
We use the word ______________ to describe signing the contract. When both parties have signed, the parties have ______________ the contract.
execute; executed
The term ______________ or the phrase ______________ is also used when all the terms and conditions of the contract have been met and carried out. It is considered performed or discharged.
executed; fully executed
A contract that is signed, but not yet carried out is called an ______________ contract
executory
The ______________ or ______________ contract has no binding effect on the parties who made it
void; invalid
An _______________ is one that violates the Statute of Frauds and will not be enforced by the courts - the verbal real estate agreement.
unenforceable agreement
________________ are money damages set out in the contract.
Liquidated damages
________________ punish the defaulting party and
________________ are set to cover the actual injury or economic loss
Punitive damages; compensatory damages
A lease for ______________ is the exception to the Statute of Frauds.
one year or less
A clause in a contract that allows each party to hold the other to strict performance by the date specified is called ____________________.
time is of the essence
The real estate transaction begins with a ________________. It progresses to a sales contract and ends with __________and __________.
listing or buyer representation agreement; closing; funding
An offer may be called a _____________________
purchase agreement
All offers must be presented to the intended party unless _____________
given written constent
The purpose of a _______________ is to continue negotiations and work towards agreement.
counteroffer
The offer becomes a contract when it is __________ and acceptance is __________.
accepted; communicated
In the usual real estate sales contract the earnest money will be the __________________ if the buyer defaults.
liquidated damages
A condition in a contract, which has not yet been met, is a __________________
contingency
A seller can limit the length of time for a buyer's contingency to be met with an __________________.
escape clause
What is it when you ask the court to force the buyer to buy the property?
specific performance
The _______________ is the period during which improvements contribute to value, or are being depreciated.
economic life
Additional capital or property included in a transaction to even out the exchange is called ____________, which is taxed at the time of the exchange.
boot
An individual can have a tax-free capital gain on the sale of real property up to ____________, if the property was the individual's principal residence for at least ____________ of the last 5 years. The limit is ____________ for a couple
$250,000; 2; $500,000
An _________________________ is one where the sales price is paid in installments and at least one of the payments is to be received after the close of the taxable year in which the sale occurs.
installment sales contract
The Principal-Agent relationship is a ________________________
fiduciary relationship
The principal is often referred to as the ____________
client
A Buyer's Representation Agreement employs the broker to act as a fiduciary to the ____________.
buyer
A Listing Agreement employs the broker to act as a fiduciary to the ____________.
seller
A Management Agreement employs the broker/property manager to act as a fiduciary to the ____________.
owner
What are the 2 types of agency relationships?
1.) public responsibility
2.) fiduciary responsibility
_____________ occurs when a principal accepts actions that he did not authorize.
Ratification
A person with power of attorney is called an ____________________
attorney-in-fact
What are the 3 levels of Agency?
1.) Universal
2.) General
3.) Special
__________________ gives the agent the authority to represent his client in all matters, both business and personal.
Universal agency
__________________ gives the agent the power to bind his principal in a particular trade or business.
General agency
__________________ gives the agent the power to perform only specific acts and no others.
Special or limited agency
A __________________ is one who does not act as a dual agent when one of the broker's buyer clients wants to purchase an in-house listing.
single agency broker
A __________________ is a licensee who assists a buyer and seller in reaching an agreement in a real estate transaction, but doesn't have an agency relationship with either party.
transactional broker/facilitator
_______________ is practiced in many states under the _________________. The broker represents both parties with their written permission.
Dual agency; Common Law of Agency
In Texas, a broker who agrees to represent both parties in a single transaction must do so as an ___________________
Intermediary
The easiest duty of a dual agent is ___________________
accounting
A principal's duties to an agent are: (CRIP)
1.) Compensation
2.) Reimbursement
3.) Indemnification
4.) Performance
An agent's duties to his principal are: (OLD CAR)
1.) Obedience
2.) Loyalty
3.) Disclosure
4.) Confidentiality
5.) Accounting
6.) Reasonable Care
Only a _________ may earn a commission and only a _________ may sue to collect a commission.
broker; broker
_______________________________- who is ready, willing, and able to buy.
procuring cause of the sale
When an agent is also the seller or the buyer, this is called _______________________ and this dual role must always be disclosed.
agency coupled with an interest
A ____________ is an agent for a person who is already acting as an agent for a principal
subagent
The due diligence period usually begins after the contract has been ____________ and acceptance ____________
signed; communicated
The Do Not Call Registry does not limit calls to a consumer with whom a license holder has had an established business relationship for up to _____________ after the end of the last relationship
18 months
A licensee may also call a consumer for up to _________________ after the consumer has contacted the agent.
three
months (90 days)
What law states that marketing emails must offer the consumer a choice to "opt-out" or unsubscribe from future emails?
CAN-SPAM Act
The unsubscribe link must be functional for at least _____________ from the date the email was sent. If a consumer chooses to unsubscribe, that request must be honored within _____________
30 days; 10 business days
A licensee needs _____________ permission from a client to advertise client property on social media.
written
Requirements of a valid listing include:
• signatures of all the owners and the listing licensee
• property description
• list price - this must be set by the seller
• definite starting and termination date
• broker compensation
There are four types of listing agreements:
1. Exclusive Right To Sell
2. Exclusive Agency
3. Open listing
4. Net Listing
The broker is the exclusive agent and receives the commission unless the seller sells the property himself.
Exclusive Agency
What type of listing is often used by builders who reserve the right to sell new construction through their own sales office without paying a commission.
Exclusive Agency
The owner reserves the right to list with as many brokers as he chooses. He also reserves the right to sell the property himself and avoid paying a commission.
Open listing
All money over the amount the owner wants for the sale of the property is treated as the broker's commission.
Net Listing
License holders must follow the rules of the local MLS, which is owned and operated by the ____________________.
Board of Realtors
A "________________" is an employment contract wherein the broker will be the buyer's agent.
Buyer Rep
A property manager is a ________________ with a broad scope of responsibilities and liabilities
general agent
A ___________________ is used to create this relationship and define the role and responsibilities of the agent and the owner.
management agreement
These are recurring expenses necessary for the operation and maintenance of a property. They include fixed expenses such as taxes and insurance, and variable costs
such as utilities, payroll and reserves for repairs, replacement and maintenance.
Operating expenses
Operating expenses DO NOT INCLUDE
mortgage payments/debt reduction, depreciation and capital improvements/
expenditures.
___________________________________ will be necessary to compensate any individuals who may be injured on the property.
Property and Casualty insurance
The Civil Rights Act Of ____________ prohibits discrimination based on race or color.
1866
The Federal Fair Housing Act, known as the Title VIII of the Civil Rights Act of 1968, forbids discrimination on the basis of ____________________________________
race, color, national origin, and religion.
What is not a protected category of Civil Rights Act?
Sexual orientation
________________ means a minor living with a parent or guardian. ________________ also includes a pregnant woman.
Familial status; Familial status
There are two ways that a community can qualify
as senior housing.
1. 100% of the units must be occupied by someone 62 or older.
2. 80% of the units must be occupied by someone 55 or older.
_________________- causing panic selling by homeowners, also known as _________________
blockbusting; panic peddling
_________________- directing buyers into or away from certain areas because of their race, color, etc. This is also known as _________________
steering; channeling
Failure to display the poster may be considered ____________________ evidence of discrimination - evidence so great that no further investigation is necessary.
prima facie
When a complaint is made to HUD, HUD will try _____________
and _____________to resolve the problem before pursuing the matter in court.
mediation; conciliation
Victims have up to _____________ to seek mediation through HUD and up to _____________ to file a complaint with
the courts.
1 year; 2 years
Who are exempt from the ADA requirements?
Single-family homes, private clubs, historic buildings, and religious organizations
a broker mixes client money with his or her funds, either business or personal.
commingling
How long should a broker should keep copies of all documents involved in his/her business for a minimum of ______________?
four years
_______________ and _______________ are two federal laws confirming
the use of electronic documents and e-signatures as being valid and binding on the parties to a transaction, as long as the parties have agreed to their use.
E-Sign and UETA
This is liability created not because of the broker's actions but because of the broker's relationship with the liable party - his sponsored agents.
Vicarious liability
The _________________________________ were passed to preserve business competition by prohibiting monopolies, monopolistic practices, and restraint of trade.
Sherman and Clayton Anti-Trust Acts
A property where there has been a murder or alleged haunting is called _______________
stigmatized
_______________ is a federal law requiring all states to release information to the public about known convicted
sex offenders when necessary to protect the public's safety
Megan's Law
_______________ uses adjectives and opinions rather
than details or facts (the most beautiful landscaping).
Puffing
_______________ is not misrepresentation. _______________ is marketing
Puffing; Puffing
insurance protects both broker and sales licensees from
a legal claim or liability for mistakes, errors, and negligence in usual listing and selling activities.
Errors and Omissions Insurance - E&O
liability risks may include bodily injury or property damage caused by direct or indirect actions of the insured.
General Liability Insurance
Use of the lead paint disclosure for all properties
built before ____________ is required by the Residential Lead-Based Paint Hazard Reduction Act of 1992.
1978
land that has never previously been developed
Greenfields
land able to be redeveloped (empty Walmart)
Greyfields
land known to be hazardous - most likely a hazardous industrial site
Brownfields
was passed in 1980, and created the Superfund to help pay for the cleanup of hazardous spills and waste
CERCLA - the Comprehensive Environmental Response, Compensation and Liability Act
For commercial property, or any property where there is reason to believe there might be hazardous materials on site, a _______________ should be recommended
Phase 1 ESA
The _________________________ involves site identification, monitoring, and response activities for environmental protection and waste management.
Superfund Amendments and Reauthorization Act (SARA)
An _____________________________is done to determine the effect of a project on the community.
Environmental Impact Statement (EIS)
Public Controls, Statutes and Public Utilities to be disclosed include:
• Zoning and planning guidelines
• School districts, Utility districts, Tax Districts
• Homeowners' Association membership / Property Owner's Association membership
A "__________________" is defined as something that would warn a reasonably observant agent that there may be an underlying problem
red flag
Mortgage loans fall into two broad categories -
conventional and non-conventional loans.
A __________________ is one that is neither federally insured nor guaranteed. (It is not an FHA or VA loan.)
conventional loan
In an effort to encourage homeownership, the federal government insures or guarantees __________________ mortgage loans through three agencies: the __________________ , the U.S. __________________ and __________________ .
non-conventional; FHA; VA; USDA
__________________ (Installment Contract or Land Contract or Real Estate Contract) is also an instrument for financing
the sale of real property.
Contract for Deed
A __________________ is a pledge of real property as security for a promissory note.
mortgage
The action of pledging real property as security for a debt is called __________________
hypothecation
The __________________ borrows the money and gives the mortgage as a pledge to the lender. The lender is called the __________________ .
mortgagor; mortgagee
In a __________________ state when a mortgage loan is used for the purchase of real property, at closing the buyer receives the title and the lender has a lien.
lien theory
In a__________________ state at closing the lender receives the title and will hold it until the lien is satisfied or paid off.
title theory
The a __________________ is where consumers go to borrow money. It includes mortgage bankers,
mortgage brokers, banks, credit unions, etc.
primary market
The __________________ is where lenders go for money.
secondary market
Three main secondary market warehousing
agencies
purchase loans, assemble them into packages, and sell them to investors.
Loans qualified to be purchased in the secondary market are called __________________
conforming loans
The secondary market warehousing agencies are
Fannie Mae, Freddie Mac and Ginnie Mae.
The secondary market is funded by __________________
investors
The most important government programs are ________ insured and ________ guaranteed loans.
FHA; VA
__________________ covers more than one piece of property (several lots on one note). This loan may contain a __________________ allowing the borrower to obtain partial releases of specific lots by making required lump sum payments.
Blanket loan; release clause
__________________ includes real property plus personal property (a furnished condominium).
Package loan
__________________ - includes principal, interest, taxes, and insurance in the monthly payment, known as __________________
Budget loan; PITI
__________________ - Two or more lenders invest in one loan. This allows the lenders to share the risk.
Participation loan
If a lender collects principal and interest and shares in the profits when the property is sold, this is called a __________________
shared appreciation mortgage
__________________ - Permits additional borrowing on the same note. This is sometimes called a credit card mortgage or a ___________________________.
Open-end mortgage; home equity line of credit - HELOC
__________________ - loans with risk based pricing - the rates are not published. Borrowers are rated A-F where a prime borrower has an A rating
Sub-prime loans
__________________ - a provision in a written mortgage, or note, stating that in the event of default the whole amount of the principal becomes due and payable.
Acceleration clause
__________________ - "Due on sale" clause states that the balance of the secured debt becomes due if the property is sold by the mortgagor without the mortgagee's approval
Alienation clause
__________________ - states that the lien is defeated when the debt is repaid.
Defeasance clause
__________________ - allows a lender to raise the existing rate. Usually found in an ARM
Escalation clause
__________________ - a statement in a mortgage that the mortgagor can pay the entire amount or the stated amount prior to the due date in the note.
Prepayment clause
__________________ - allows a lender to move to or take a lower lien position
Subordination clause
__________________ - allows a new borrower to take over the payments on an existing loan under specified terms and conditions
Assumption clause
In a __________________ , the new buyer is approved, and takes over payments and liability. This is often called a __________________
straight assumption; loan novation
In an _________________ the buyer takes over payments, but is not liable for the loan. The original borrower remains liable
assumption "subject to"
The front ratio -___________. The second or back ratio - ___________
28%; 36%
Points are associated with loans. A point is ______________ of the loan amount
one percent
________________ are prepaid interest and tax deductible. ________________ are loan processing fees. They are not tax deductible
Discount points
TRUTH-IN-LENDING OR CONSUMER CREDIT PROTECTION ACT - TILA is administered by the
Consumer Financial Protection Bureau - CFPB
A small referral gift can be given to an unlicensed person who provides a referral to a license holder. (The TEXAS limit is _____________ in value, not cash.)
$50
Loan Estimate form (LE) must be provided by the mortgage broker or lender to the consumer upon receipt of or within _____________________ of loan application. Business days are Monday through Saturday. The borrower must acknowledge receipt of the LE
3 business days
The borrower has ___________ after he receives the LE, to respond to the lender and indicate whether he wants
to continue with the loan application or cancel his application.
10 days
The Closing Disclosure form (CD) must be received by the consumer at least ___________ before closing and the lender must have proof of receipt.
3 business days
_________________, the refusal to lend in a particular geographic area, is prohibited.
Redlining
An unscrupulous lender takes advantage of a consumer's lack of knowledge regarding lending practices, this is called _________________
predatory lending
Charging an interest rate higher than the legal limit is referred to as _________________
usury
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Verified questions
algebra
Find the percent age. Round answer to the nearest dollar. 8% of $6,475
economics
The Engineering Department at Sims Software Inc. recently developed two chemical solutions designed to increase the usable life of computer disks. A sample of disks treated with the first solution lasted 86, 78, 66, 83, 84, 81, 84, 109, 65, and 102 hours. Those treated with the second solution lasted 91, 71, 75, 76, 87, 79, 73, 76, 79, 78, 87, 90, 76, and 72 hours. Assume the population standard deviations are not the same. At the .10 significance level, can we conclude that there is a difference in the length of time the two types of treatment lasted?
economics
Ms. Morra teaches introductory classes in office technology. Her school board has approved $15,000 for her to buy new computers to replace her old outdated models. For this amount she can buy 20 low-end computers that just meet her student’s current needs, or she can purchase 10 computers with greater speed and capabilities that she really would like her students to learn to use. What is her opportunity cost for either of these choices?
psychology
What neurotransmitter does current and past antipsychotic drugs target?
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