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Allied Schools. Ca Real Estate Principals 141 Flashcards part 1
Terms in this set (141)
Estate at Sufferance
Retention of possession without the consent of the landlord after the lease has expired; also referred to as tenancy at sufferance.
Federal Home Mortgage Corporation - (FHLMC)
"Freddy Mac" is a wholly owned subsidiary of the Federal Home Loan Bank System, which serves as a secondary mortgage market for savings and loan associations, who are members of the FHLBB; also referred to as The Mortgage Corporation.
Lien Theory State
The mortgage merely creates a lien right on the mortgagee with the mortgagor retaining the title.
The cost of substituting a similar structure with utility equivalent to the subject property but constructed with modern materials.
The transfer of title to land from one party to another.
exaggeration of a property's benefits
Bringing two or more lots together under one ownership.
A type of contract that arises when a promise is given in exchange for a return promise. (A real estate contract)
A lender who receives a pledge of property to secure a debt.
A legal declaration in which a person disposes of property to take effect upon his or her death.
The charge upon the land of a debtor, resulting from the decree of a court, entered in the judgment docket. Lawsuit
Private Mortgage Insurance.
Installment Land Contract
See Land Contract.
Right of Re-entry
The right retained when a fee simple on condition subsequent exists; also referred to as the power of termination. Back to court.
A legal right of a landowner who owns land next to a natural watercourse to reasonable use of whatever water flows past the property.
Refers to any passage of title property, upon intestacy to those heirs, related by blood or marriage, who the law designates.
Ordinances passed by local governments with special minimum standards of construction for new buildings. They also apply to major additions to old construction.
Contract for a deed
A means by which the seller passes possession but retains title to the property until the total or a substantial portion of the purchase price is paid. Installment contract. The two parties here are the vendor (owner) and vendee (buyer).
A mortgage on real estate in which the lender's rights are superior to the rights of subsequent lenders. (Recorded first)
Occurs when two or more sites are combined, with the result that the value of the assembled site is worth more than the value of the sum of each of the individual sites.
without legal force
The practice of some lending institutions that restrict the number of loans or the loan-to-value ratio in certain areas of a community, i.e., it is illegal for a lending institution to require a higher down payment because the home the borrower is located in a racially mixed area.
A signed instrument acknowledging the existence of a debt and the promise to pay.
Federal Home Loan Bank System - (FHLBB)
A federal agency which oversees and regulates all federally charted savings and loan association.
Involves the use of force or improper actions, against a person or property, in order to induce a party to enter into a contract.
Economic function of bringing buyers and sellers together through the price mechanism.
An employment contract between the owner of real estate and a property management firm that agrees to oversee the management of the property.
An encumbrance, second in priority, to a previously recorded lien or to a lien to which the encumbrance has been subordinated.
Effective Gross Income
The anticipated income resulting from the estimated potential gross income from a rental property less an allowance for vacancy and bad debts.
Tenancy by the Entire Entiresties (Entirety)
A special joint tenancy between a lawfully married husband and wife, which places all title to property (real personal) into the marital unit, with both spouses having an equal undivided interest in the whole property. In each spouse owns the ENTIRE estate.
An agreement between an owner and many brokers. If a broker produces a ready willing, and able buyer, a commission is due. However, the owner still has the right to sell his/her property and is not obligated to pay a commission to anyone.
Real Estate Settlement Procedures Act (RESPA)
A law which covers most mortgage loans made for one to four-unit residential property. It requires the lender to provide the loan applicant with pertinent information so that the borrower can make informed decisions as to which lender will be used to finance the purchase.
The holder of a life estate.
Land and all man-made improvements both on and to the land, plus all tangible interest in the real property. Surface, subsurface and air rights.
The amount paid by the purchaser, which when added to the mortgage amount, equals the total sales. At time of closing this is referred to as equity.
Covenant of Further Assurance
A promise that the grantor will perform further acts reasonably necessary to correct any defects in the title or in the deed instrument.
A tax rate stated in tenths of a cent. For example, a millage rate of 150 mills on property assessed at $100,000 would result in a property tax of$1,500 ($100,000 x .150).
Term Mortgage (Straight Term)
A method of financing in which interest only is paid during the time of the loan. At maturity, generally five years or less, the entire principal is due.
A financial middleman who, in addition to bringing the borrower and the lender together, makes loans, packages them, and sells the packages to both primary and secondary investors. Also services loans.
Transferring title to real property by of a will.
Dying without a will
The channeling of prospective home purchasers or renters, by real estate brokers or salespersons, into racially homogeneous neighborhoods, and actively discouraging them away from neighborhoods of different racial or ethnic composition.
A 6-by-6 mile area containing 36 sections each 1 mile square. A division of land in the rectangular survey method of land description.
The rights that a husband acquires in the wife's property upon her death.
Any activity which attempts to drive prices down for the purpose of causing transition from one ethnic group to another. This is a violation of Federal Fair Housing Laws. Also called "panic selling".
A mortgage which covers more than one piece of real estate. Often used by a developer in the financing of undeveloped lots. Contains a partial release clause.
Purchase and Leaseback
The simultaneous buying of property and leasing it back to the seller.
From time to time jurisdictions levy a charge on certain pieces of property for the purpose of paying for the cost of a public improvement such as sewers or sidewalks, which particularly benefit properties being assessed as opposed to those improvements benefiting the public at large. Considered a tax.
Legal documentation in a condominium regime which provides the establishment of the home-owner's association; provides the powers and authority given to the board of directors; and indicates various rights and responsibilities of the unit owners.
The rate of return considered to be a reasonable return on investment - given the risk.
The broker agrees to sell the property in order to achieve a net price to the owner, and anything which is received above the net price is the broker's commission. A net listing is prohibited by the licensing law in many states.
A formal declaration made by the grantor conveying the property to the grantee--a necessary element for a deed.
Action to Quiet Title
The lawsuit filed by a person to remove or clear the claims of others against property.
The interest rate charged to a lender's AAA customer. This is normally the base from which other interest rates are derived.
Dividing property taxes, hazard insurance and other expenses or income between the buyer and seller, as of date of settlement.
One that attaches to a particular property.
Annual Percentage Rate (APR)
The yearly cost of credit. Interest Rate plus finance charge.
A court-appointed person who is charged with preserving a property, collecting rents and doing anything necessary to maintain the property's condition.
Refers to boundaries; used with the word "metes" in the metes and bounds method of land description.
The right to hold, possess, control and dispose of property.
Property jointly owned on a pro-rata basis with other unit owners in a condominium regime.
A clause in which the holder of a mortgage permits a subsequent mortgage to take priority. Subordination is the act of yielding priority.
A lease, which has the original terms automatically renewed for successive periods, until proper notice to terminate is given by either the landlord or tenant. Month to month rental.
A promissory note evidencing a loan in which payments of interest only are made periodically during the term of the note, with the principal payment due in one lump sum upon maturity. A straight note is usually a nonamoritized note made for a short term, such as two to 4 years, and is renewable at the end of the term. A mortgage that secures a straight note is a term mortgage or straight-term mortgage.
Any lien, claim or encumbrance, on piece of real estate, that has been properly recorded in the public records. Recorded defects impair title and may result in the title being unmarketable.
Not capable of being charged or terminated.
Estate at Will
An occupation of space, for an indefinite period, which can be terminated by either the lessor or lessee at any time. Also referred to as tenancy at will.
Metes and Bounds
A method of land description which involves identifying distances and directions and makes use of both the physical boundaries and measurements of the land.
Right of Survivorship
Upon the death of a joint tenant or tenant by the entirety the interest does not pass to the tenant's heirs but to the other join tenant(s).
Repealing a contract either by mutual consent of the parties to the contract or by one party when the other party is in breach of the contract.
The right of government to require contribution from citizens to pay for government services.
A traditional means of appraising property based on the assumption that value is equal to the present worth of future rights to income.
An encumbrance placed on property through some willful act of the owner.
Property that is free and clear of any liens.
The value placed on property, by the tax assessor, for the purpose of determining the property tax.
Charging more than the rate for the use of money.
Owner making conveyance of title or interest in property.
A form of property ownership in which a corporation is established to hold title in property and to lease the property to shareholders in the corporation. Own stock.
Statutory Period of Redemption
The time within which property may be redeemed after a foreclosure sale.
Tenancy at Sufferance
A tenancy which is created when one is in wrongful possession of realty, even though the original possession may have been legal.
The tract of land burdened by an easement.
Gross Rent Multiplier (GRM)
A method of appraising single family or duplexes based on the monthly gross income.
A policy that protects the insured against loss or damage due to defects in title.
Fee Simple Determinable
An estate which has been created to exist only until the occurrence or nonoccurrence of a particular event. Returns automatically.
A mortgage subordinate to a first mortgage; also referred to as a junior mortgage. (Recorded Second)
States that upon default, all of the principal installments come due immediately.
A person with the authority to take oaths and acknowledgments.
Cloud on Title
Any claim affecting title to property.
The cost of exactly duplicating a structure using the same material and design.
Refers to land and improvements both on and to the land, and also to the physical aspects of real estate, including surface, air and subsurface rights plus, bundle of rights.
Physical evidence of a point- of- beginning established by surveyors for use in locating parcels of land.
Attorney in Fact
A person given the authority to act on behalf of another under a power of attorney.
Gross Income Multiplier (GIM)
A method of appraising income-producing property based on a multiple of the annual gross income; also called a gross rent multiplier.
One in which personal property is pledged to secure a note.
Unity of Title
States that the joint tenancy interests were created in a single conveying instrument.
process of pledging something (house) as security, but retaining possession of it.
An easement created to benefit adjacent land.
Comparable property recently sold which is used in the market data approach.
Easement by Implication
Occurs because of necessity, such as the conveyance of a land-locked property.
Federal Deposit Insurance Corporation (FDIC)
A federal agency established to insure the deposit in member commercial banks. The current maximum insurance per account is $100,000.00.
A loss in value due to reduced desirability and usefulness of a structure because its design and construction have become obsolete. A loss due to a structure's becoming old fashion, not in keeping with today's standards or needs, with consequential loss of income.
Ownership by one person.
Regulation Z requires disclosure of all costs of financing the purchase of owner occupied residential purchases of one to four units. It also requires disclosure of the annual percentage rate of the loan. Implementation of Regulation Z is over seen by the Federal Reserve Board.
Occurs between willing buyer and willing seller with each party completely knowledgeable about the market. A purchaser of property between relatives (father & son) would not be an "arms length transaction".
The scarcity of real estate refers to the limited supply of certain types of real estate at particular locations.
An agreement formed through the oral or written words of the parties.
One who acts for and in place of a principal for the purpose of affecting the principal's legal relations with third persons.
Life Estate Pur Autre Vie
A life estate in one person with another person serving as the measuring life.
One authorized to transact all of the principal's affairs within the context of a broad commercial or other kind of endeavor. Property manager.
Refers to crops which require annual planting.
(1) one who employs an agent. (2) money or capital.
Graduated Payment Mortgage (GPM)
A financing technique for residential real estate in which monthly payments start at a lower rate and increase periodically over the life of the mortgage; FHA 245.
Purchaser or donee receiving title to property.
The process of taking a person's property into legal custody by a order called a writ of Attachment. Property is frozen.
A future interest in the grantor, which occurs whenever the owner of real estate conveys an estate of lesser duration than the owner has.
Value of real estate less any liens against it.
A binding agreement containing all of the essential legal elements.
A junior mortgage which provides an owner additional capital without refinancing the first mortgage. (The original mortgage is not disturbed)
The recognition that states give whereby a licensee of one state can be involved in real estate transactions in other states.
An agreement by two or more individuals or entities to engage in a single project or undertaking.
The interest earned by an investor on the investment.
A right to limited use or enjoyment by one or more persons in the land of another.
The right of a mortgagor (borrower) to make good on the default within a specified time and receive the property back.
Personal property used in business which has been annexed to real property and is removable by the owner. (Tenant) If it is not taken by the tenant it becomes the property of the landlord.
A person licensed to perform on behalf of any licensed real estate broker any act or acts authorized to be perform by the broker.
A legal procedure whereby property used as security for a debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the note.
The right of government to ownership of property, which is left by a deceased property owner who leaves no will, and dies without descendants.
A written description of a parcel of land which locates it precisely and will hold up in court. (Does not include address.)
Occurs when the person in a contract, to whom the duty was owed, expressly agrees to substitute the delegate, or new obligor, for a consideration, and agrees to discharge the old obligor from the obligations under the contract. For example, loan assumptions.
Property which has been pledged as security for a loan.
A lot ready for development.
That part of a deed beginning with the words "to have and to hold," following the granting clause and reaffirming the extent of ownership in the estate granted as, for example, a fee simple, life estate, or easement: "To have and to hold unto said Sally Smith, grantee, a life estate in the following property".
A financial debt that is paid off over a period of time by a series of periodic payments. A loan can be fully amortized or partially amortized requiring a balloon payment to satisfy the debt at the end of the term.
Covenant Against Encumbrances
The assurance that no encumbrances other than those specified in the deed exist.
Ready, Willing and Able
Someone fully qualified to enter into a transaction.
Planned Unit Development (PUD)
A type of exception, or special use, permitted under many modern zoning ordinances, allowing a mixture of different land uses or densities.
Broadly defined as personal property which has become realty. Examples include built-in cabinets or bathtubs. Business (trade) fixtures can be removed if they leave no damage to the real estate, and they are removed before the end of a lease or by agreement with the landlord at a later time.
The actual possession of land by one who claims rightful ownership of a freehold estate therein.
Graduated Lease Provisions
This lease provides for periodic step increases in the rental payments.
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