All Flashcards
Kansas Real Estate Commission (KREC)
KREC is a governmental body that oversees real estate in Kansas.
1. Determines how licenses are earned and maintained
2. Protects the public
3. Enforces regulations
There are five commissioners, each appointed by the Governor, who vote on issues. There are also employed staff people who work at KREC, but none of them can vote.
Kansas Association of REALTORS® (KAR)
KAR is a professional trade association that licensees may choose to join.
a professional trade association that provides services for real estate brokers and salespeople
Real Estate
land and anything artificial attached to it. (a house is bound to land through foundation)
Brokerage (verb)
process of bringing parties together.
real estate brokerage (the noun)
a real estate company.
supervising broker
oversees the entire operation at the main office and compensates everyone in the office.
branch broker
has a business relationship with the supervising broker at the main office, but is responsible for the operation of the branch office.
Associate Broker
someone who has a broker’s license, but is associated with (supervised by) a supervising broker.
Salesperson
Generates business and then provides services on behalf of the broker.
Staff
Some are licensed while others are not. Unlicensed staff can perform administrative tasks.
MLS Multiple listing service
a computer based system that allows brokers to share information about their listings (the properties they are marketing for sellers) and it allows brokers to more efficiently find properties for buyers.
Rebates
where an unlicensed person receives money in some form for real estate activity Example, a seller is promised money after closing for listing with the licensee. - illegal in kansas
Referral fees
where a licensee recommends another licensee (such as when clients are moving to another city) - legal in kansas
BRRETA
Brokerage Relationships in Real Estate Transactions Act
Transaction Broker
If a buyer or seller wants a licensee to provide only information. DOES NOT REPRESENT THE BUYER OR SELLER.
BRRETA brochure
Brokerage Relationships brochure) is a menu of services with explanations that help consumers determine which service is best for them. The brochure must be given to the consumer at the first practical opportunity.
Dual Agency
If a licensee were to represent both the buyer and the seller in the same transaction - illegal in KS
Client
A buyer or seller who signs a written agency agreement of any kind with you becomes your client(also known as a principal).
customer
A buyer or seller who has not signed a written agency agreement with you
Designated Agency
creates a “one to one” relationship between the licensee and the client
agency
signing the agreement ON BEHALF OF THE ENTIRE BROKERAGE, creating a legal relationship between the buyer and everyone in the brokerage
trust account
bank account in which a supervising broker or branch broker holds other people’s money. No more than $100.00 of the broker’s money can be in the account
Commingling
when more than $100 of the broker’s money is in a trust account
Ministerial acts’
acts that a licensee may perform for a person that are informative in nature and do not rise to the level of active representation on behalf of a person.
When can a transaction broker disclose confidential information
In commercial real estate (and any residential real estate involving more than four units). unless prohibited from doing so by the buyer and/or seller
How much can KREC fine a Licensee?
$1,000.00 per violation. If the violation is considered “aggravated,” the fine can be up to $5,000.00. Aggravated means it was extreme or intentional.
CON NOT LEVY CRIMINAL FINES - ONLY CIVIL
A willful violation of either the license law or BRRETA is a misdemeanor. A court of law may impose what penalties
1st Violation: Up to 12 months in jail and/or fines from $100 to $1000.
2nd Violation: Up to 12 months in jail and/or fines from $1000 to $10,000.
Will KREC deny a license if someone has a felony conviction
Not necessarily - depends on how recent and the nature
Indestructibility
The land itself cannot be completely destroyed or worn out
Nonhomogeneity
Each parcel of real estate is unique. Even side-by-side properties that look like duplicates are technically not, because of their unique locations
Scarcity
There is a fixed supply of land. This affects the price.
Modification
Intentional changes to a parcel of land can either increase or decrease its value. The actual changes, such as landscaping, are called improvements, regardless of their impact (favorable or unfavorable).
Permanence of Investment
Also called fixity. Anything which is “fixed” stays put.
Area Preference
The site (the actual location and surroundings) of real estate matters to buyers. The technical term is situs.
Allodial System
Property ownership as it is today in the U.S., with all the rights of ownership
Common Law
law that resulted from many years of court decisions, as opposed to statutes which are written laws enacted by legislative bodies
Possession
occupy the property
Enjoyment
possess the property without interference, such as someone else claiming that they own it, or perhaps someone doing something to excessively taint the owner’s experience on the property.
Disposition
dispose of the property (sell or give it to someone).
Control
use the property (legally) as desired.
Exclusion
keep others from using the property.
Land
Ownership extends down to the center of the earth and upward to infinity. It includes all natural things permanently attached. Naturally growing plants and minerals are part of the land. In addition to surface rights, the owner has subsurface rights, and air rights.
subsurface rights
a landowner could sell his or her land but retain the mineral rights.
Real property
real estate plus the bundle of rights
Personal Property
any property that is not real property.
severance
Real property becoming personal property
attachment
Personal property becoming real property
emblements
Cultivated annual crops are considered personal property, and are called emblements, or fruits of industry.
Fixture
an object that was once personal property, but now is attached. Therefore, it’s now real property. Kitchen cabinets and bath tubs are examples of fixtures.
Trade fixture
a fixture used for a business. It is attached by the tenant, remains the personal property of the tenant, and can be removed by the tenant when leaving the space being leased, but the tenant is responsible for any damages caused from the removal. Shelves, signs and counters
Four Tests to determine if something will be considered real or personal property
Agreement of the Parties
Intention of the Parties
Method of Attachment
Adaptation of the Item
Police Powers
local and state governments have the power to pass legislation to protect public health and safety. Think of the side of a police vehicle. It says: “To protect and serve.”
Zoning Ordinances
regulate and control the use of land
Zoning Classifications
specifically determine the purpose(s) for which land can be used (R- Residential, C - Commercial, I - Industrial or A – Agricultural)
Enabling legislation
passed by the state grants local government zoning powers
Planned Unit Development (PUD)
This is a new, preplanned area of a city.
buffer zone
Instead of having two different zones, such as residential and commercial, right next to each other, parks and playgrounds often serve as buffer zones.
Nonconforming Use
(also known as grandfathered use) – If zoning rules change, a nonconforming use may be allowed if the property’s current use existed before the zoning rules changed.
Downzoning
reducing density in an area.
Spot Zoning
a specific property is rezoned to permit a use that’s different from the other properties in that zone.
variance
an exception
conditional-use permit
Property owners who are given permission to do something that is not consistent with the zoning code are granted a special-use permit
Building Codes
Using its police powers, the government protects the public by setting standards regarding fire safety, carpentry, electrical work, plumbing, etc.
Building Permit
granted for new construction only if the proposed building complies with zoning laws and building codes.
Subdivider
buys undeveloped land and divides into smaller lots for sale
plat
map that shows the boundaries of the lots.
subdivision plan
shows all physical details of the subdivision, including easements for water, utilities, and sewers
Clustering
putting housing units on smaller lots to create more open space in the area, perhaps for recreation.
Developer
Improves the land, constructs buildings on the lots, and sells them.
Land Sale Regulation
The buyer (having received the property report and signed the contract) has a 7-day cooling off period to revoke the contract.
Taxation
A charge on real estate to meet the financial needs of government.
Eminent Domain
The power of government to seize private land for a public good, without the owner’s consent
condemnation
The government takes title to the property
Inverse Condemnation
the process by which property owners can force government (through a legal process) to buy their property because a government project has caused significant loss of value
Escheat
If someone dies without a will, and there are no heirs found (through a required search) the property would revert to the county or state
Asbestos
banned in 1978. it had been used as insulation, as covering for ducts and pipes, and as material in flooring, roofing, etc. It crumbles easily into dangerous, inhalable particles.
Lead
used in paint until 1978. It can also be found in pipes, solder, and other products. Exposure can cause damage to the brain, kidneys, and the nervous system.
Radon
colorless, odorless, tasteless gas produced by the decay of radioactive substances. Home inspections should include a radon test for the benefit of the buyer.
Brownfields Legislation
old industrial sites that may contain toxic wastes. Legislation gave states financing to clean them up and it protects developers from liability for toxic waste that existed before they purchased the property.
encumbrance
an agreement or circumstance that places a restriction on how a property can be used
easement
makes something easier or better for someone
positive easement
allows you to cross your neighbor’s property, for example, if it’s the only way you can get to the main road
negative easement
prevents a property owner from building an excessively high building that blocks your view of a lake or valley
appurtenant easement
an easement that remains with the property even after it is sold to another party
easement in gross
does not remain in effect when property is sold, it is simply an agreement where a land owner grants permission to someone to enter his or her property, to fish in a farm pond, for example.
Dominant Tenement
benefits from the easement
Servient Tenement
it serves the need of the Dominant to access the public road.
Easement by Necessity
an easement allowing someone to do something necessary.
Personal Easement in Gross
AKA Easement in Gross
personal easement (typically between friends). No dominant party. Ends when either party dies or when one sells the property.
License
only temporary permission (ex: farmer lets someone use land to hunt for the day) terminates at the agreed time of expiration
Commercial Easement in Gross
most common type of easement in gross. It is given to railroads, utility companies, etc., to maintain tracks, pipelines, and power lines to provide utilities and services. The commercial easement allows them to enter private property to install or repair items, or to do tasks as needed.
Easement by Prescription
f Sam has a driveway at the edge of his property that extends on to Mary’s property, and Sam has used the driveway for a certain period of time (5 years or more in most states), this may result in a permanent easement right by prescription
encroachment
somebody crossed over a line they weren’t supposed to cross
Deed Restrictions
a condition or limitation placed on a property by the owner of the property when it’s transferred to another party
lien
a lender’s claim against a collateral asset. his means that the home can be legally sold (by the lender) if the borrower fails to repay the loan.
lienor
lender (holder of the lein)
Lienee
The borrower
Specific lien
a claim against specific property (Either real or personal)
general lien
a claim against all of a person’s real and personal property.
voluntary lien
When you sign mortgage documents to buy a home, you are knowingly and voluntarily (with your consent) creating a lien on the property
involuntary lien
local government has the power to place a tax lien on your home if you fail to pay the real estate taxes
statutory liens
created by law
equitable liens
created by a court
Ad Valorem
(assessed value) real estate tax raises money for the operation of government agencies
How to compute ad valorem tax rate
Market value of the property X Assessment rate = Assessed Value X Equilizer (if necessary) = Equalized assessed value X Tax rate = Tax bill
mills
1/10 of 1 cent or .0001
Equalizer
a factor (such as 0.8, 1.2, etc.) that is multiplied by the assessed value to raise or lower a community’s overall assessed value (when necessary) so it is in line with the entire state, making community to community comparisons fair, and making statewide taxes fair.
Tax Sale
occurs when taxes on property have not been paid for a period of time specified by law.
Equitable Redemption
Pay what is owed (taxes, penalties, court costs) before the tax sale.
Statutory Redemption
Pay what is owed (taxes, penalties, court costs) after the tax sale
Special Assessments
a tax for improvements made in a specific area or neighborhood, such as a sidewalk.
Mortgage Lien
When a buyer signs a mortgage document, this creates a lien against the property
Mechanic’s Lien
The mechanic can file for a mechanic’s lien if they are not paid for work done or materials supplied. This lien is specific and involuntary. It is specific to the real estate and involuntary, because the property owner didn’t agree to the lien. The mechanic’s right to file this lien is provided by government
Lis Pendens
a notice in the public records that would inform you if there were a pending lawsuit involving a property
Metes and Bounds Description
Metes means distance. Bounds means direction. This is the oldest system of property description. Using objects (monuments) to reference
Point of Beginning (POB)
where the property officially begins
boundary lines
The perimeter of the property referenced in relation to monuments
legal description
an official property description suitable for a real estate sales contract
Principal Meridians
The bold north/south lines
Baselines
dotted lines running east and west
Size of Township
6 miles X 6 miles (36 square miles)
Rectangular Survey System
creates a massive grid or checkerboard that is referenced.