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NC Real Estate > Chapter 2 > Flashcards

Chapter 2 Flashcards

1
Q

Bundle of Rights

A

A lot of rights and interests get transferred with a piece of real estate (disposition, enjoyment, exclusion, possession, control) DEEPC

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2
Q

Tenements

A

all of the rights and interests that go with the land

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3
Q

Hereditaments

A

land and all of the tenements that can be inherited

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4
Q

Profit a prendre/profit

A

intangible rights in the land of another; right to take minerals, soils, timber, fish, or game from that land

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5
Q

fruits of the soil (fructus naturales)

A

perennials, plants that transfer with the land

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6
Q

fruits of industry (fructus industriales)

A

annuals, plants that do NOT transfer with the land, must be planted yearly. Considered personal property. Transferred with a bill of sale.

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7
Q

Appurtenance

A

any right, privilege, or interest of the owner that runs with the land

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8
Q

Subsurface right (mineral right)

A

interest that allows the owner to take minerals from the earth

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9
Q

Mineral lease

A

permits use of the land for mineral exploration and mining operations

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10
Q

Air rights

A

rights to the area above the surface of the earth

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11
Q

Lateral support

A

right of land to be supported in its natural state by adjacent land

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12
Q

Subjacent support

A

right to have one’s land supported from below

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13
Q

Fixture

A

an item of personal property that is attached to the land or a permanent improvement on the land in such a manner that the law deems it to be part of the real property to which it is attached

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14
Q

Total Circumstance Test

A

a test that is used to determine if an item is personal property or a fixture; composed of four criteria: Intention, Relation of the Attacher, Method, and Adaptation

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15
Q

Intent

A

One of the four criteria on the Total Circumstance Test and the major determinant in deciding if an item is a fixture

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16
Q

Estate

A

A possessory interest in real property; may be either a freehold estate or a leasehold
estate; an extent or degree of a person’s interest in real property

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17
Q

Freehold Estates

A

A possessory interest in real property of uncertain (and often unlimited)
duration; an ownership estate in real property; either a fee simple or life estate. The holder of a
freehold estate has title. (ownership)

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18
Q

Allodial System

A

The system of land ownership that allows anyone to own land. There are 4 government rights: Police power, Eminent Domain, Taxation, Escheat (PETE)

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19
Q

PETE

A

Police power, eminent domain, taxation, escheat

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20
Q

Police power

A

regulations for the health, safety, and welfare of the community

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21
Q

Eminent domain

A

taking of property for the public good: The government’s constitutional power to take private property for public
use, as long as the owner is paid just compensation. (Condemnation is the action; eminent
domain is the right.)

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22
Q

Taxation

A

The right of government to require contribution from citizens to pay for government
services.

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23
Q

Condemnation

A

the action of taking property for eminent domain

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24
Q

Escheat

A

The reversion of property to the state (or, in some states, the county) after a person
dies without leaving a valid will or having any heirs.

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25
Tenant
someone who holds an estate
26
Leasehold estates
e The temporary interest that an owner gives to a tenant (lessee) that includes the right of possession and quiet enjoyment, without title (Less than ownership)
27
Types of Freehold Estates
Fee simple, fee defeasible, life estate
28
Fee simple (fee, fee simple absolute)
includes everything in the bundle of rights, forever, unconditionally (most common form of ownership)
29
Fee simple Defeasible
Conditional ownership; ownership can be defeated under certain conditions
30
Condition Subsequent
A fee simple defeasible estate that requires a lawsuit to defeat ownership ("but if")
31
Determinable
A fee simple defeasible estate that has automatic reversion if a condition is not met ("as long as")
32
Life Estate
a non-inheritable freehold estate, created only for the life of the life tenant
33
Life tenant
one who holds a life estate
34
Conventional life estate
A grantor passes ownership to a life tenant and establishes the life tenant as the measuring life. When the life tenant dies, the estate reverts back to the grantor
35
Conventional life estate with Remainder interest
A grantor passes ownership to a life tenant who is also the measuring life. When the life tenant dies, the estate is passed on to a 3rd party (remainderman)
36
Life estate Pur Autre Vie
A grantor passes ownership to a life tenant and establishes a 3rd party as the measuring life. When the 3rd party dies, the estate reverts back to the grantor
37
What rights does a life tenant have?
Act as owner, sell, transfer, encumber, borrow money, pay property taxes & assessments, make repairs
38
What CAN'T a life tenant do?
Commit waste; waste is the purposeful damage to the value of the revertor's interest
39
Estover
life tenant can use resources on the property to make improvements
40
Marital Life Estates
includes a dower or a curtest
41
Dower
a wife's right to a life estate in the marital home
42
Curtesy
a husband's right to a life estate in the marital home
43
Reversionary Interest
anytime the interest/estate goes back to the grantor
44
Remainder interest
anytime the interest/estate goes to a 3rd party/remainderman
45
What are the four types of ownership of real property?
Severalty, Tenancy in common, Joint tenancy, tenancy by the entirety
46
Severalty Ownership
ownership by one person
47
What are the 3 types of ownerships between 2 or more people?
Tenancy in common, joint tenancy, and tenancy by the entirety
48
Tenancy in Common (TIC)
A form of co-ownership in which two or more persons each have an undivided interest in the entire property (unity of possession), but no right of survivorship. The most common in NC
49
Joint Tenancy
A form of co-ownership in which the co-owners have equal undivided interests and the right of survivorship. Requires the unities of possession, interest, title, and time. (PITT)
50
Tenancy by the Entirety
A form of property co-ownership by a married couple or partners in a legal civil union in which each spouse or partner has an equal and undivided share of the entire property. Not recognized in every state.
51
Suit for partition
court action to end co-ownership; parting ways
52
Right of Survivorship
surviving co-tenants automatically acquire a deceased co-tenant’s interest in the property.
53
What is the difference of a Joint Tenancy in NC vs other states?
In NC, it does not favor the right of survivorship, thus it must be written in. It operates as a TIC.
54
What ways can you terminate a Tenancy by the Entirety?
Death, divorce, or agreement by the parties
55
What are the four types of common interest community ownerships?
Condos, townhouses, cooperatives, and timeshares
56
Condominium
A property developed for co-ownership, with each co-owner having a separate interest in an individual unit, combined with an undivided interest in the common areas of the property and air space consisting of the area between the walls, floor, and ceiling.
57
Townhome/Townhouse
Property developed for co-ownership where each co-owner has a separate fee simple interest in an individual unit, including its roof and basement, as well as the land directly beneath the unit, and an undivided interest in the common areas of the property.
58
Cooperative
A type of property ownership under which residents have the right to occupy a unit by purchasing stock shares in the corporation that owns the property. These individuals own stock shares, not real estate.
59
Timeshare
A form of property ownership in which several buyers purchase an interest in the same estate, with each party having the right to use the property and facilities for a designated period.
60
Trust
arrangement where a person's assets are being held by a 3rd party (usually a bank, attorney, or other person) for the benefit of that person
61
Fiduciary arrangement (trust)
the 3rd party trustee holds assets on behalf of a beneficiary, the trust has set parameters of the trustee's authority, and it may allow assets to pass outside of probate
62
Living trusts
place assets into a trust for a person's benefit during their lifetime and then transfer assets to a designated beneficiary at death
63
Testamentary trusts
leaving of assets to children or others in cases in which the distribution may be set to occur at a particular time/event (birthday, graduation, marriage)
64
Land trust
trustee agrees to hold ownership of the real property for the benefit of the trustor
65
Encumbrance
a right or interest in property by someone other than the owner
66
Liens
A non-possessory interest in property, giving a lienholder the right to foreclose if the owner does not pay a debt owed the lienholder.
67
What are the five specific types of liens?
Mortgage, Trust Deeds, Real Estate Taxes, Assessments, and Mechanical Liens
68
What are the two types of general liens?
Judgments and Income taxes
69
Mortgage lien
loans you requested be placed on your home; voluntary; specific (limited to the property)
70
Real Estate Tax
always the #1 lien, levied according to value (ad valorem), based on the assessed value
71
Mechanic Lien
by contractors, subcontractors, and suppliers who have done work on your home
72
Restrictive covenants (CCRs)
A restriction on real property use imposed by a former owner; promise to do or not do an act relating to real property; usually an owner’s promise to not use property in a particular way. May or may not run with the land.
73
Restrictions may be written in the individual deed or recorded as a master instrument
Declaration of Restrictions
74
Lis Pendens
lawsuit pending
75
Easements
nonpossessory rights or interests in land owned by another. It provides a right of use of land, not a right of possession
76
Types of Encumbrances
Liens, CCRs, Deed restrictions, lis pendens, easements, encroachments
77
What are the different types of easements?
appurtenant, easement in gross, easement by necessity, prescriptive easement
78
Appurtenant Easement
attaches to the land and goes with it, benefits adjacent property, must be in writing, and are permanent
79
Easement in Gross
benefits a 3rd party, usually for utilities (personal or corporation/commercial)
80
Easement by Necessity
rules favors use of real estate, must exhaust all other means of use, use as a last resort
81
Easement by Prescription
statutory use period in NC is 20 years; must meet "adverse possession" elements (open, continuous, exclusive, adverse, notorios (OCEAN)), for a prescribed period of time
82
Party wall
used by two adjoining neighbors to support the sidewall of each unit
83
Encroachment
a trespass on the land of another as a result of an intrusion or invasion by some structure or other object (wasll, fence, overhanging balcony, or driveway)
84
Emblements
An annual crop that is planted and cultivated by a tenant farmer and is always the personal property of the tenant farmer (fructus industriales)
85
Ad Valorem
according to value
86
Machinery Act
sets the details of property taxation in NC
87
Assessed value
the value placed on a property for taxation purposes
88
Market Value
The most probable price a property should bring on an open and competitive market under all conditions essential to a fair sale
89
Octennial Reappraisal
Reappraisal of property every 8 years
90
Tax assessor
responsible for the valuation of property for tax purposes
91
NC Tax Rate Formula
(Assessed Value divided by 100) times Tax Rate
92
Mill Rate
a tax rate based on one-tenth of one cent
93
Mill
one-tenth of one cent (.001)
94
Mill Rate Formula
Assessed Value divided by 1000 times Mill Rate
95
Appraisal
the process of determining a market value
96
Assessment
the determination of a value of the property for taxation purposes
97
Front Foot
the number of feet a property has the borders on an improvement by the local government

NC Real Estate (16 decks)

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